SULAIMAN IMTIAZ AHAMED,CHENNAI V. ACIT, NON CORP. CIRCLE 3(1) CHE, CHENNAI

SA 2/CHNY/2026

AI Insights

The case involves Sulaiman Imtiaz Ahamed, the appellant, who filed a stay application against the recovery of an outstanding demand arising from an assessment under the Income-tax Act, 1961, for the Assessment Year 2017-18. The demand was based on an addition of Rs.10,11,49,057 as unexplained credit under section 68 of the Act, taxed at an enhanced rate under section 115BBE, related to cash deposits during the demonetization period. The appellant contested the addition, arguing that the cash deposits were from duly accounted sales. The Tribunal considered the financial hardship and the substantial payment already made by the appellant in deciding to grant the stay.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 826246 (ITAT-CHENNAI)
• Duration Of Justice: 2 day(s)
• Appeal Type: Stay Application
• Pronouncement Date: 09-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Appeal Filed On: 07-01-2026
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANITHA
• Assessee Lawyers: N. ARJUN RAJ
• Keywords: Unexplained cash credit; Rejection of books of accounts; Application of stay
• Section: 68; 234B; 2

Judgement Text

"आयकर अपीलीयअिधकरण, ‘बी’ \u0001यायपीठ,चे ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI सु\u0003ी प\u0006ावती . . . . एस, , , , लेखासद\u000eय एवं \u0003ी मनु क ुमार िग र, \u0010याियक सद\u000eय के सम\u0014 BEFORE Ms.PADMAVATHY S, ACCOUNTANT MEMBER AND SHRI MANU KUMAR GIRI, JUDICIAL MEMBER SA No.2/Chny/2026 [in ITA No.: 4013/CHNY/2025] िनधा\u000eरणवष\u000e/Assessment Year: 2017-18 Sulaiman Imtiaz Ahamed, No.35, Cathedral Road, Gopalapuram, Chennai-600 086. V. The ACIT, Non-Corporate Circle-3(1), Chennai. PAN: AACPA7322H (अपीलाथ\u0007/Appellant) (\b यथ\u0007/Respondent) अपीलाथ\u0007क ओरसे/Appellant by : Shri N. Arjun Raj, Advocate \u000e\u000fयथ\u0007क ओरसे/Respondent by : Mrs. Anitha, Addl.CIT सुनवाईक तारीख/Date of Hearing : 09.01.2026 घोषणाक तारीख/Date of Pronouncement : 09.01.2026 आदेश आदेश आदेश आदेश /O R D E R PER MANU KUMAR GIRI, JM: The Stay Application in SA No.2/Del/2026 for Assessment Year 2017-18 filed by the assessee has arisen out of ITA No.4013/Chny/2025. This Stay Petition is filed by the assessee seeking stay of recovery of the outstanding demand arising out of the assessment completed under the Income-tax Act, 1961, pending disposal of the appeal filed before the Tribunal. Printed from counselvise.com 2 SA No.2/Chny/2026 2. Brief facts of the case are that the assessment was completed by making an addition of Rs.10,11,49,057/- as unexplained credit under section 68 of the Act and taxing the same at enhanced rate u/s.115BBE of the Act, treating the same as part of cash deposits made during the demonetization period. Consequently, a demand was raised comprising the following: Tax Rs. 7,80,91,969/ Interest u/s 234B Rs. 2,55,64,473/ Interest u/s 234C Rs. 1,68,735/ Interest u/s 234D Rs. 68,607/ Total Demand Rs. 8,30,93,784/ Out of the above, the assessee has already paid a sum of Rs.2,08,00,000/-, and the outstanding demand stands at Rs.8,30,93,784/-. 3. The appeal filed by the assessee before the ld.CIT(A) has been partly allowed vide order dated 17.12.2025. Against the said order, the assessee preferred an appeal before this Tribunal, which was filed on 27.12.2025 and is numbered as ITA No. 4013/CHNY/2025. 4. The ld. AR submitted that the assessee has a strong prima facie case. It was contended that the Assessing Officer has not rejected the books of accounts maintained by the assessee nor found any discrepancy therein. The cash deposits were out of duly accounted Printed from counselvise.com 3 SA No.2/Chny/2026 sales, which were reported in return of income as well as to the VAT authorities. Despite availability of stock and proper accounting of sales, the lower authorities erred in making the impugned addition on a standalone basis under section 68 of the Act. It was further submitted that the assessee has already paid more than 20% of the demand, and in view of severe working capital constraints, particularly considering fluctuation in gold prices, recovery of the balance demand would cause irreparable hardship. Accordingly, a stay of recovery was prayed for along with early hearing of the appeal. 5. The ld.DR for the revenue opposed the stay and relied on the orders of the lower authorities. 6. We have considered the rival submissions and perused the material on record. We note that the assessee has already discharged a sum of Rs.2.08 crores, which is more than 20% of the demand. Considering the facts and circumstances of the case, the nature of the addition, the payment already made, and the financial hardship pleaded by the assessee, we are of the view that the assessee has made out a prima facie case for grant of stay, and the balance of convenience is also in favour of the assessee. Accordingly, we direct that recovery of the outstanding demand of Rs.8,30,93,784/- shall remain stayed for a Printed from counselvise.com 4 SA No.2/Chny/2026 period of 180 days from the date of this order or till disposal of the appeal, whichever is earlier, subject to the condition that the assessee shall not seek unnecessary adjournments and shall cooperate for early disposal of the appeal. Further, considering the request for early hearing, the Registry is directed to fix the appeal for hearing on 06.02.2026. 7. In the result, the Stay Petition filed by the assessee is allowed. Order pronounced in the open court on 09th January, 2026 at Chennai. Sd/- Sd/- (प\u0006ावतीएस) (मनुक ुमारिग र) (PADMAVATHY S) (MANU KUMAR GIRI) लेखा सद\u0010/ACCOUNTANT MEMBER \u0011ाियकसद\u0010/JUDICIAL MEMBER चे\u0016ई/Chennai, \u0018दनांक/Date:09.01.2026 TLN, Sr.PS आदेशक ितिलिपअ ेिषत/Copy to: 1. अपीलाथ#/Appellant 2. $यथ#/Respondent 3. आयकरआयु& /CIT, Chennai 4. िवभागीय ितिनिध/DR 5. गाड+फाईल/GF . Printed from counselvise.com "