SANJANA SANJAY ARORA,MUMBAI V. ASSESSING OFFICER, DDIT (INV)-3(1), FAIU, MUMBAI

BMA 34/MUM/2025

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The case involves Sanjana Sanjay Arora, the appellant, who appealed against the penalty of Rs. 10 Lakh imposed under Section 43 of the Black Money Act for non-disclosure of a foreign bank account in her income tax return for the assessment year 2017-18. The Assessing Officer had levied the penalty due to the alleged non-disclosure of a foreign bank account in Schedule FA of the return. The appellant contended that the non-disclosure was due to an inadvertent mistake in mentioning the account number and that all transactions were disclosed. The Tribunal found the need for further investigation into the nature of the accounts and their transactions.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 826938 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 10 day(s)
• Appeal Type: Black Money Appeal
• Pronouncement Date: 09-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2017-2018
• Appeal Filed On: 30-09-2025
• Laws Referred To: Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI
• Assessee Lawyers: RAVIKANT PATHAK
• Keywords: Set aside; Peak credit
• Section: 15

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER BMA No. 34/MUM/2025 (Assessment Year: 2017-18) Sanjana Sanjay Arora, D Décor Exports 1071 Solitaire Corporate Park, Guru Hargovindji Marg Chakala, Andheri East, Mumbai – 400093 PAN : BAEPA3434R ............... Appellant v/s Deputy Director of Income Tax, (Investigation)-3(1), FAIU, Mumbai ……………… Respondent Assessee by : Shri Ravikant Pathak, CA Revenue by : Shri Hemanshu Joshi, Sr.DR Date of Hearing – 26/11/2025 Date of Order - 09/01/2026 O R D E R PER SANDEEP SINGH KARHAIL, J.M. The assessee has filed the present appeal against the impugned order dated 18.08.2025, passed under section 15 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (“the Black Money Act”), by the learned Commissioner of Income Tax (Appeals)-51, Mumbai, [“learned CIT(A)”], for the assessment year 2017-18. 2. In this appeal, the assessee has raised the following grounds: - “1. The Hon'ble Commissioner of Income (Appeals) - 51, Mumbai [hereinafter referred as CIT(A)] erred in confirming the penalty of Rs. 10 Lacs levied u/s. 43 of the Black Money (Undisclosed Foreign Income and Assets) and Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 2 Imposition of Tax Act, 2015 (\"BMA') by the Assessing Officer on failure of the Appellant in disclosing foreign bank account maintained with Barclay Bank UK PLC (Barclays) in scheduled FA of return of income. 2. The CIT(A) erred in confirming the penalty levied u/s. 43 of the BMA without appreciating the facts that: (a) the Appellant has opened one account only in GBP bearing number 73155706 which has provided two different denomination currency account in USD and EURO bearing number 87474666 and 74565588 respectively. (b) the Appellant furnished all information of GBP account in her return of income correctly; however, while mentioning the account number she mistakenly mentioned the account number of USD account. The Appellant submits that the failure of not mentioning the correct bank account number while disclosing the bank account in schedule FA of the income tax return is due to inadvertent mistake. Therefore, the penalty levied by the AO and confirmed by the CIT(A) shall be deleted.” 3. The solitary grievance of the assessee is against the levy of a penalty of Rs. 10 Lakh under Section 43 of the Black Money Act. 4. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee is an individual. For the year under consideration, the assessee filed her return of income in ITR–2 on 31.10.2017, declaring a total income of Rs. 2,30,73,377/-. On verification of the return of income filed by the assessee for the year under consideration, it was observed that the assessee has not declared her foreign bank account in Barclays Bank UK PLC, having account no.73155706, in Schedule FA of the ITR. Accordingly, the assessee was asked to show cause as to why the penalty of Rs. 10 Lakh should not be levied under section 43 of the Black Money Act for non- disclosure of a foreign asset in Schedule FA of the return of income. In response, the assessee submitted that she regularly files her return of income and has disclosed foreign assets, including bank account details, in Schedule Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 3 FA, and “income from other sources” from outside India in her return of income for the year under consideration. The assessee further submitted that she opened the foreign bank account in Barclays Bank UK PLC in March 2016, having account no.73155706, which was a Great British Pound “GBP” account. It was further submitted that Barclays Bank UK PLC opened two other accounts, as per its policy, in EURO and USD, with account nos. 87474666 and 74565588, respectively. The assessee submitted that during the year under consideration, she had transactions only in GBP account no.73155706 maintained with Barclays Bank UK PLC, and there were no transactions in EURO and USD accounts, which were add-on accounts in her name with Barclays Bank UK PLC. The assessee further submitted that on verification of Schedule FA of the ITR, it was observed that she had disclosed information pertaining to the GBP account under the USD account number, which was an inadvertent mistake. The assessee submitted that, however, the entire transaction details of the assessee in the bank account maintained with Barclays Bank UK PLC were disclosed. 5. The Assessing Officer (“AO”), vide order dated 13.06.2023 passed under section 43 of the Black Money Act, disagreed with the submissions of the assessee and held that non-disclosure of foreign bank account maintained by the assessee in Barclays Bank UK PLC having account no.73155706 in Schedule FA of the ITR attracts penalty under section 43 of the Black Money Act. Accordingly, finding the case fit for levy of penalty under the aforesaid section, the AO levied the penalty of Rs. 10 Lakh on the assessee for non- Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 4 disclosure of foreign assets in Schedule FA of the return of income for the assessment year 2017-18. 6. The learned CIT(A), vide impugned order, dismissed the grounds raised by the assessee on this issue and upheld the levy of penalty under section 43 of the Black Money Act. Being aggrieved, the assessee is in appeal before us. 7. During the hearing, the learned Authorised Representative (“learned AR”) submitted that the assessee had opened only one bank account with Barclays Bank UK PLC, having account no. 73155706, having GBP denomination. The learned AR further submitted that the other two accounts, one in EURO (account no. 87474666) and one in USD (account no. 74565588), were opened by the Bank itself as add-on accounts to facilitate its customers' multi-currency transactions without having to manage multi- currency accounts. Reiterating the submissions made by the assessee before the lower authorities, the learned AR submitted that the assessee, in her return of income for the assessment year 2017-18, duly disclosed the transaction peak balance during the year in the GBP account. However, due to inadvertence, she mentioned the account number of the USD account instead of the GBP account. The learned AR, by referring to the bank statement of Barclays Bank UK PLC, submitted that all the transactions of the assessee were in the GBP account, having account no. 73155706, while the other two add-on accounts in EURO and USD had a Nil balance throughout the year. Thus, the learned AR submitted that EURO and USD accounts were merely the add-on accounts, which were not separate from the main account of the assessee in GBP, whose transaction details were duly disclosed by the Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 5 assessee in Schedule FA of the ITR, and therefore, the conditions of section 43 of the Black Money Act for levy of penalty are not satisfied in the present case. 8. On the other hand, the learned Departmental Representative (“learned DR”) submitted that there is no information that all three accounts are linked, and there is no material available on record to show that it was the Bank’s policy/practice to open multiple currency accounts, without any request from the customer. 9. We have considered the submissions of both sides and perused the material available on record. In the present case, on the basis that the assessee has not furnished details of her bank account having account no.73155706 maintained with Barclays Bank UK PLC, while filing her return of income in Schedule FA for the year under consideration, a penalty of Rs.10 Lakh was levied under section 43 of the Black Money Act. It is the plea of the assessee that she had opened only one bank account with Barclays Bank UK PLC, having account no.73155706, which was a GBP account. As per the assessee, under the Bank’s policy, the Bank opens accounts in other currencies on its own. Accordingly, Barclays Bank UK PLC opened a EURO account with account no. 87474666 and a USD account with account no. 74565588, in the name of the assessee. As per the assessee, all her transactions were conducted in her GBP account with account no. 73155706, and she had no transactions on the other two accounts opened by Barclays Bank UK PLC. In this regard, during the hearing, reliance was placed on the bank account statement of Barclays Bank UK PLC for the period between Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 6 01.04.2016 and 31.03.2017. As per the assessee, since her entire transactions were in the GBP account, she disclosed the details of those transactions in Schedule FA of the return of income for the year under consideration. During the hearing, by referring to the bank statement as noted above, it was submitted that the peak balance in the said account was GBP 175,303.27, which was equivalent to Rs.1,67,26,681/-, which was disclosed by the assessee in Schedule FA of ITR-2 filed for the year under consideration. In this regard, our attention was drawn to Schedule FA of the return of income on page 25 of the paper book. However, as per the assessee, due to inadvertence, the account number of the USD account, i.e., 74565588, was mentioned in Schedule FA instead of the main account, i.e., GBP account no.73155706. Thus, it is the plea of the assessee that since there was neither any failure to furnish the information nor any furnishing of inaccurate particulars in respect of the account maintained outside India in Barclays Bank UK PLC, the impugned penalty under section 43 of the Black Money Act is not sustainable. 10. Having considered the submissions of both sides and perused the material available on record, it is evident that in the present case, the assessee made the disclosure regarding the peak balance in her bank account maintained with Barclays Bank UK PLC in Schedule FA of her ITR filed for the year under consideration on 31.10.2017. It is also evident from the perusal of the penalty order passed under section 43 of the Black Money Act that the show cause notice for the levy of penalty was issued because the bank account no. 73155706 with Barclays Bank UK PLC was not declared by the assessee Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 7 while filing her return of income. It is the consistent plea of the assessee that the bank account no. 73155706 was the only account opened by the assessee with Barclays Bank UK PLC, which was a GBP account. However, the Bank, on its own and in accordance with its policy, also opened accounts in EURO and USD in the name of the assessee to facilitate multiple-currency payment transactions for its customers. As per the assessee, these accounts are nothing but add-on accounts, which do not have an existence separate from the main GBP account. During the hearing, the learned AR submitted that the only usage of having an account in EURO and USD is that if there is any transaction in EURO and USD, then the same shall be through these add-on accounts. However, the main account which will have the credit or debit shall be the GBP account. The learned AR also submitted that the assessee tried to receive a communication from the Bank in this regard. However, to date, no such information has been received. During the hearing, the learned AR placed on record the information available on the website of the Bank, which states that the Bank facilitates the customer to make multiple currency payments from a single bank account, without having to manage multiple currency accounts. However, from the perusal of the said information, we are of the considered view that the same does not in any manner clarify that the three accounts maintained by the assessee with Barclays Bank UK PLC were all linked and the accounts in EURO and USD were only add-on accounts, without having any existence separate from the main account in GBP . From the perusal of the bank statement for the year under consideration of Barclays Bank UK PLC, from pages 29-52 of the paper book, we note that throughout the year the assessee had a Nil balance in EURO and USD accounts. However, in the Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 8 absence of any clarity regarding the aspect noted above, it is difficult to come to the conclusion that all three accounts are linked, and the GBP account is the main account. Even though the assessee has made a declaration of the peak balance of Rs. 1,67,26,681/- in Schedule FA of the ITR for the year under consideration, however, in view of the aforesaid ambiguity, the said declaration does not rest the case in favour of the assessee, as the clarity on the abovementioned aspect is relevant for deciding the validity of penalty levied under section 43 of the Black Money Act. 11. Therefore, in the interest of justice and fair play, we deem it appropriate to grant one more opportunity to the assessee to bring necessary information on record regarding these three bank accounts in Barclays Bank UK PLC. Accordingly, we set aside the impugned order and restore the matter to the file of the AO for de novo adjudication after verification of the aspect as noted above. In this regard, the AO shall be at liberty to seek necessary information from the Bank, through the proper channel, for complete adjudication of the issue involved. As a result, the grounds raised by the assessee are allowed for statistical purposes. 12. In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 09/01/2026 Sd/- Sd/-OM PRAKASH KANT ACCOUNTANT MEMBER Sd/- SANDEEP SINGH KARHAIL JUDICIAL MEMBER MUMBAI, DATED: 09/01/2026 Prabhat Printed from counselvise.com BMA No. 34/Mum/2025 (A.Y. 2017-18) 9 Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai Printed from counselvise.com "