RAJIV KUMAR,FATEHGARH SAHIB V. INCOME TAX OFFICER, WARD SIRHIND, SIRHIND

ITA 1235/CHANDI/2024

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The case involves an appeal by Shri Rajiv Kumar, the proprietor of M/s Sunil Sweets, against the order of the Commissioner of Income Tax (Appeals) which confirmed the Assessing Officer's decision to tax an additional income of Rs. 35 lacs at a rate of 60% under section 115BBE of the Income Tax Act, 1961. This additional income was declared during a survey conducted by the tax department, which uncovered discrepancies in the assessee's accounts. The Tribunal examined whether this income should be taxed at the normal business income rate or the higher rate specified under section 115BBE. After reviewing the circumstances under which the income was declared and the nature of the income, the Tribunal decided in favor of the assessee, allowing the appeal partially.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 783391 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2017-2018
• Appeal Filed On: 24-12-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RANJIT KAUR
• Assessee Lawyers: SHRUTI KHANDELWAL
• Keywords: Business income; Unexplained investment
• Section: 69C

Judgement Text

"आयकर अपीलȣय अͬधकरण,चÖडीगढ़ Ûयायपीठ “एकल” चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “SMC” CHANDIGARH Įी संजय गग[, ÛयाǓयक सदèय BEFORE: SH. SANJAY GARG, JUDICIAL MEMBER आयकर अपील सं./ ITA No. 1235/CHD/2024 Ǔनधा[रण वष[ / Assessment Year : 2017-18 Shri Rajiv Kumar, Prop. M/s Sunil Sweets, Chandigarh Road, Khamanon, Fatehgarh Sahib, Punjab. बनाम The ITO, Ward, Sirhind. èथायी लेखा सं./PAN NO: BGBPK5233K अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent Ǔनधा[ǐरती कȧ ओर से/Assessee by : Smt. Shruti Khandelwal, Advocate for Shri Parikshit Aggarwal, CA राजèव कȧ ओर से/ Revenue by : Dr. Ranjit Kaur, Addl. CIT, Sr.DR सुनवाई कȧ तारȣख/Date of Hearing : 03.11.2025 उदघोषणा कȧ तारȣख/Date of Pronouncement : 04.11.2025 HYBRID HEARING आदेश/ORDER The present appeal has been preferred by the assessee against the order dated 30.10.2023 of the Commissioner of Income Tax (Appeals) NFAC, Delhi [in short ‘the CIT (Appeals)] pertaining to 2017- 18 assessment year. 2. The assessee in this appeal is aggrieved by the action of the CIT (Appeals) in confirming the action of the Assessing Officer (in short ‘the AO’) in charging tax @ 60% u/s 115BBE of the Income Printed from counselvise.com ITA 1235/CHD/2024 A.Y. 2017-18 2 Tax Act, 1961 (in short ‘the Act’) on the income offered by the assessee of Rs.35 lacs during/post survey action. Though he has also taken another ground of confirmation of Rs.24,287/- made by the AO on account of disallowance of deduction claimed under Chapter-VI-A of the Act, however, the same has not been pressed. 3. Now coming to the sole ground contested by the assessee as to whether the tax at normal rates is to be charged on the amount offered of Rs.35 lacs as additional income or the tax @ 60% as provided u/s 115BBE of the Income Tax Act is to be charged. 4. Admittedly during the survey action, the survey party had found certain discrepancies in the accounts of the assessee where upon the assessee had offered the additional income of Rs.35 lacs, detailed as under : 1. On account of excess cash - Rs.950000/- 2. On account of excess stock - Rs.450000/- 3. On account of unaccounted advances - Rs. 1500000/- 4. On account of unaccounted investment in building - Rs.3500000/- 5. The ld. counsel for the assessee has invited our attention to the submission of the assessee recorded during survey action and also the post survey letter written by the assessee to the Department to show that the aforesaid amount of Rs.35 lacs was offered as over and above his business income. The ld. AR has further submitted that the nature of the aforesaid income offered Printed from counselvise.com ITA 1235/CHD/2024 A.Y. 2017-18 3 was of business income only and the aforesaid income was generated out of business activities of the assessee only, though it was not a case of addition/assessment u/s 66/69/69-A, 69-B, 69C or Section 69D of the Income Tax Act. 6. After hearing the rival contentions, I find merit in the submissions of the ld. AR. A perusal of the statement recorded during survey action coupled with the offer letter furnished during the post survey proceedings would reveal that the aforesaid additional income was offered by the assessee on account of discrepancies in accounts found during the course of survey action and the same were out of business income of the assessee. In view of this, it is directed that the tax would be charged on the additional income offered by the assessee at normal rate as applicable to the income from business or profession. 7. With the above observations, the appeal of the assessee is partly allowed. Order pronounced on 04th November,2025. Sd/- ( संजय गग[) (SANJAY GARG ) ÛयाǓयक सदèय/ Judicial Member “Poonam” Printed from counselvise.com ITA 1235/CHD/2024 A.Y. 2017-18 4 आदेश कȧ ĤǓतͧलͪप अĒेͪषत/ Copy of the order forwarded to : 1. अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. आयकर आयुƅ (अपील)/ The CIT(A) 5. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 6. गाडŊ फाईल/ Guard File Assistant Registrar Printed from counselvise.com "