NARENDRA KUMAR AGRAWAL, RAIPUR,RAIPUR V. PRINCIPAL COMMISSIONER OF INCOME TAX, RAIPUR-1, RAIPUR

ITA 330/RPR/2025

AI Insights

The case involves Narendra Kumar Agrawal, the appellant, who received an unsecured loan in cash amounting to Rs. 75 lacs from Shri Ramkinkar Agrawal, which was found to be in violation of section 269SS of the Income Tax Act, 1961. The Pr. Commissioner of Income Tax, Raipur-1, invoked revisionary powers under section 263, noting that the Assessing Officer did not initiate penalty proceedings nor levy any penalty under section 271D despite this violation. The matter was remanded back to the Assessing Officer for a fresh assessment and to consider initiating penalties. The Tribunal upheld the Pr. CIT's order, agreeing that the original assessment was erroneous and prejudicial to the interests of the revenue.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 398161 (ITAT-RAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-06-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S.L ANURAGI
• Assessee Lawyers: YOGESH SETHIA
• Keywords: Opportunity of being heard
• Section: 263

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ रायपुर मɅ। IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.330/RPR/2025 Ǔनधा[रण वष[ / Assessment Year : 2018-19 Narendra Kumar Agrawal House No.67, Santosh Nilay, Crest Greens, Kota Road, Beside Disha College, Raipur-492 001 (C.G.) PAN: ACIPA4448C ........अपीलाथȸ / Appellant बनाम / V/s. The Pr. Commissioner of Income Tax, Raipur-1(C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Shri Yogesh Sethia, CA Revenue by : Shri S.L Anuragi, CIT-DR सुनवाई कȧ तारȣख / Date of Hearing : 03.06.2025 घोषणा कȧ तारȣख / Date of Pronouncement : 05.06.2025 2 Narendra Kumar Agrawal Vs. Pr. CIT, Raipur-1 ITA No. 330/RPR/2025 आदेश / ORDER PER PARTHA SARATHI CHAUDHURY, JM: This appeal preferred by the assessee emanates from the order of the Ld. Pr. Commissioner of Income Tax, Raipur-1 (for short ‘Pr. CIT”) passed u/s.263 of the Income Tax Act, 1961 (for short ‘the Act’), dated 24.03.2025 for the assessment year 2018-19 as per the grounds of appeal on record. 2. This is a case where the Pr. CIT, Raipur had invoked the revisionary power u/s.263 of the Act while observing that there has been violation of Section 269SS of the Act by the assessee for the fact that the assessee had accepted an amount of loan/deposit of Rs.75 lacs in cash and the A.O while framing assessment had not initiated penalty proceedings nor had levied penalty u/s.271D of the Act. It was observed by the Ld. Pr. CIT that the assessee had received an unsecured loan from Shri Ramkinkar Agrawal in cash amounting to Rs.75 lacs which was in contravention of Section 269SS of the Act and since there has been no initiation of penalty u/s.271D of the Act by the A.O, therefore, the assessment framed by the A.O was erroneous in so far it is prejudicial to the interest of the revenue. The effective Para of the order of the Ld. Pr. CIT is extracted as follows: “8. Considering the above legal provisions of the Act and the factual position of this case as emanating from the assessment order and case records as well as the judicial precedents as discussed above, I am of the considered opinion that the 3 Narendra Kumar Agrawal Vs. Pr. CIT, Raipur-1 ITA No. 330/RPR/2025 assessment order is erroneous in so far as it is prejudicial to the interests of revenue in view of Section 263 of the Income tax Act. Thus, the assessment order is held to be erroneous in so far as it is prejudicial to the interests of revenue. The said assessment order is hereby set-aside to the file of the AO with a direction to pass a fresh assessment order in a speaking manner after making all necessary enquiries required and initiation of penalty u/s.271D of the Income Tax Act, 1961 after providing due and adequate opportunity of being heard to the assessee and after considering all the submissions, etc. made and counter-reply submitted by the assessee in a fair and judicious manner.” 3. We have heard the submissions of the parties, analyzed the facts and circumstances in this case. The facts emanating from the relevant documents i.e. order passed u/s. 263 of the Act by the Ld. Pr. CIT and the assessment order spells out clearly that the assesse had received unsecured loan in cash from Shri Ramkinkar Agrawal amounting to Rs.75 lacs. In this regard, it was held by the Pr. CIT that there is direct contravention of Section 269SS of the Act, for which, penalty u/s. 271D of the Act should have been initiated by the A.O and since this was not done, therefore, the assessment framed was being erroneous in so far as it is prejudicial to the interest of the revenue. Accordingly, the matter was remanded back to the file of the A.O for making fresh assessment after making necessary enquiries and to initiate penalty u/s. 271D of the Act. However, at the time of hearing, the Ld. Counsel for the assessee submitted that this is a wrong statement of fact mentioning that such cash loan was received by the assessee. He further submitted that there has been no cash transaction with Shri Ramkinkar Agrawal and the assessee 4 Narendra Kumar Agrawal Vs. Pr. CIT, Raipur-1 ITA No. 330/RPR/2025 and there has not been any contravention of Section 269SS of the Act, hence, no penalty is imposable u/s.271D of the Act. However, the Ld. Counsel failed to submit any documentary evidence regarding the claim that such loan was taken through banking channels. 4. In our considered view, the aforesaid submission of the Ld. Counsel is contrary to facts appearing on record. Therefore, it is all the more appropriate that the assessee should place his case before the A.O and after hearing submissions, considering the relevant documents, the A.O should verify the facts and examine all the documents on record as regards the said contention made by the assessee. In view thereof, we do not find any infirmity in the order passed by the Ld. Pr. CIT u/s. 263 of the Act, wherein he has provided another opportunity to the assessee to represent his case before the A.O. The said order is upheld. 5. Before parting, we state that even without going into the merits of the order passed u/s. 263 of the Act the entire genesis of the case before us is starting from assessment order, the order passed u/s. 263 of the Act by the Pr. CIT is based on the fact that cash loan has been received by the assessee but this itself has been submitted to be a wrong statement of fact as appearing on documents on record by the Ld. Counsel for the assessee and since this issue requires factual verification, therefore, when already the matter is remanded back by the Ld. Pr. CIT to the A.O with a direction 5 Narendra Kumar Agrawal Vs. Pr. CIT, Raipur-1 ITA No. 330/RPR/2025 to pass fresh assessment order in a speaking manner after making all necessary enquiries required for initiating penalty u/s. 271D of the Act. We therefore do not find any infirmity with the findings of the Ld. Pr. CIT and in view of submissions raised by the Ld. Counsel for the assessee, considering the totality of the facts and circumstances, the order passed u/s.263 of the Act by the Pr. CIT is thus upheld. 6. As per the above terms the grounds of appeal of the assessee stands dismissed. 7. In the result, appeal of the assessee is dismissed. Order pronounced in the open court on 05th day of June, 2025. Sd/- Sd/- ARUN KHODPIA PARTHA SARATHI CHAUDHURY (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; Ǒदनांक / Dated : 05th June, 2025. SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ /The Appellant. 2. Ĥ×यथȸ /The Respondent. 3. The Pr. CIT-1, Raipur (C.G.) 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 5. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, 6 Narendra Kumar Agrawal Vs. Pr. CIT, Raipur-1 ITA No. 330/RPR/2025 // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. "