PAAN MAHEL ,DELHI V. ITO, WARD 49, DELHI

ITA 1361/DEL/2024

AI Insights

The case involves Paan Mahel appealing against the orders of the CIT(A)/NFAC, Delhi, which confirmed additions made by the Assessing Officer under sections 68 and 115BBE of the Income Tax Act, 1961, for the Assessment Year 2017-18. The primary contention was regarding the additions of Rs. 57,00,000 and Rs. 21,10,000, which were alleged unexplained cash credits and unexplained capital introduced, respectively. The Tribunal found that the detailed evidence provided by the assessee was not adequately examined by the lower authorities and thus restored the matter back to the Assessing Officer for a thorough examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 31503 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2017-2018
• Other Referred Cases: SMILE ITA No. 1361/Del/2024 Paan Mahel vs. ACIT, W.P. (MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.), CIT vs. Metachem Industries (2000) 245 ITR 160 (MP), CIT vs. Metal & Metals of India (2007) 208 CTR 457 (P&H)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HARPREET KAUR HANSRA
• Assessee Lawyers: AMIT GOEL; PRANAV YADAV
• Keywords: Unexplained cash credit
• Section: 143(3); 68; 208

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘F’, NEW DELHI Before Sh. Satbeer Singh Godara, Judicial Member & Sh. Amitabh Shukla, Accountant Member ITA No. 1361/Del/2024 : Asstt. Year: 2017-18 Paan Mahel, M-47, Greater Kailash, Part-1, New Delhi-110048 Vs Income Tax Officer, Ward-49, New Delhi (APPELLANT) (RESPONDENT) PAN No. AASFP2468D Assessee by : Sh. Amit Goel, CA & Sh. Pranav Yadav, Adv. Revenue by : Ms. Harpreet Kaur Hansra, Sr. DR Date of Hearing: 20.03.2025 Date of Pronouncement: 20.03.2025 ORDER Per Satbeer Singh Godara, Judicial Member: This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2023-24/1060588190(1) dated 07.02.2024, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”). 2. Heard both the parties at length. Case file perused. 3. This assessee’s appeal raises the following substantive grounds: “1. On the facts and circumstances of the case and in law, the assessment order passed by Ld. Assessing Officer is bad- in-law and CIT(A) erred in not holding so. ITA No. 1361/Del/2024 Paan Mahel 2 2. On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the assessing officer of Rs. 57,00,000/- on account of alleged unexplained cash credit u/s. 68 r.w.s. 115BBE of the Income Tax Act, 1961. 3. On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition to the extent of Rs 21,10,000/- on account of alleged unexplained Capital introduced treated as unexplained cash credits u/s 68 r.w.s. 115BBE of the Income Tax Act, 1961.” 4. Coming to the assessee’s instant former substantive ground, seeking to reverse both the lower authorities’ action making section 68 unexplained cash credit addition, learned counsel invites our attention to it’s detailed paper book running into 204 pages comprising of various documentary evidence(s) claiming the same as regular business turnover only. The Revenue could hardly dispute all this specific detailed evidence has neither been properly examined in the course of assessment or in the lower appellate proceedings. We thus deem it appropriate to restore the assessee’s instant former substantive ground back to the Assessing Officer within three effective opportunities subject to a rider that the assessee shall plead and prove his case at his own risk and responsibility, in consequential proceedings. Ordered accordingly. 5. It is further made clear before parting that so far as the learned lower authorities action assessing the assessee u/s 115BBE is concerned, hon’ble Madras high court in SMILE ITA No. 1361/Del/2024 Paan Mahel 3 Microfinance Ltd. Vs. ACIT, W.P. (MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.) has already settled the issue against the department that the law applies to the transaction on or after 01.04.2017 only. Necessary computation shall follow as per law. This assessee’s first and foremost ground is partly allowed in above terms. 6. Next comes the latter issue of section 68 r.w.s. 115BBE unexplained cash credit addition of Rs.21,10,000/- representing capital introduced by the partners which couldn’t be treated as unexplained in the firm’s hands as per CIT vs. Metachem Industries (2000) 245 ITR 160 (MP) and CIT vs. Metal & Metals of India (2007) 208 CTR 457 (P&H). We thus delete the impugned latter addition made in the assessee’s hands. 7. No other ground or argument has been pressed before us. 6. This assessee’s appeal is partly allowed in above terms. Order Pronounced in the Open Court on 20/03/2025. Sd/- Sd/- (Amitabh Shukla) (Satbeer Singh Godara) Accountant Member Judicial Member Dated: 20/03/2025 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR "