TRIPURARI CHAUDHARI,VAISHALI V. ACIT, CENTRAL CIRCLE, DHANBAD

ITSSA 21/RAN/2022

AI Insights

The case involves Tripurari Chaudhary, a director in a company, who faced multiple assessments under sections 143A and 143(3) of the Income Tax Act following a search and seizure operation at his premises in 2014. The assessments for the years 2009-10 to 2015-16 included various additions under the heads of agricultural income, unexplained cash, unexplained investments, and unexplained expenditures. The primary contention was the use of seized materials, specifically MKS-03, which were argued to be original cash memos and not incriminating evidence. The Tribunal found that the additions made were based on disallowances out of the books of account and not on any undisclosed income or expenses, leading to the setting aside of the assessments.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716557 (ITAT-RANCHI)
• Duration Of Justice: 3 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 22-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 05-05-2022
• Other Referred Cases: Abhisar Buildwell (P.) Ltd. vs. [2023] 454 ITR 212 (SC)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT DATTA; LD
• Assessee Lawyers: DEVESH PODDAR
• Keywords: Set aside; Unexplained expenditure; Unexplained investment
• Section: 143(3); 40A(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, BEFORE S/ RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER Assessment Year Tripurari Chaudhary, 147, Madarana, Vaishali, PAN/GIR No. (Appellant Per Bench These are of the ld CIT(A), Patna CIT(A), Patna-3/10367/2016 Patna-3/10372/2016 3/10379/2016-17, & CIT(A), Patna for the assessment year IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI S/HRI GEORGE MATHAN, JUDICIAL MEMBER RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER IT(ss)A Nos.16 to 22/RAN/2022 Assessment Years : 2009-10 to 2015-16 Tripurari Chaudhary, 147, Madarana, Vaishali, Vs. Asst. Commissioner of Income Tax, Central Circle, Dhanbad .AHQPC 1073 J (Appellant) .. ( Respondent Assessee by : Shri Devesh Poddar, Adv Revenue by : Shri Rajat Datta, ld CIT Date of Hearing : 21/08/202 Date of Pronouncement : 21/08/2 O R D E R These are appeals filed by the assessee against the of the ld CIT(A), Patna-3 in Appeal No.CIT(A), Patna-3/10365/2016 3/10367/2016-17, CIT(A), Patna-3/10370/2016 3/10372/2016-17, CIT(A), Patna-3/10376/2016-17, CIT(A), Patna 17, & CIT(A), Patna-3/10399/2016-17, all for the assessment years 2009-10 to 2015-16, respectively. P a g e 1 | 5 IN THE INCOME TAX APPELLATE TRIBUNAL, , JUDICIAL MEMBER AND RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER 22 16 Asst. Commissioner of Income Tax, Central Circle, Respondent) Devesh Poddar, Adv : Shri Rajat Datta, ld CIT DR 2025 2025 filed by the assessee against the separate orders 3/10365/2016-17, 3/10370/2016-17, CIT(A), 17, CIT(A), Patna- 17, all dated 23.3.2022 Printed from counselvise.com IT(ss)A Nos.16 to 22/RAN/2022 Assessment Years : 2009-10 to 2015-16 P a g e 2 | 5 2. Shri Devesh Poddar, ld AR appeared for the assessee. Shri Rajat Datta, ld CIT DR represented on behalf of the revenue. 3. It was submitted by ld AR that the assessee is a Director in a Company. It was the submission that search & seizure operation at the premises of the assessee on 3.9.2014. It was the submission that as a consequence of the search, assessments came to be completed u/s.143A r.w.s 143(3) of the Act. Ld AR submitted that for the assessment year 2009-10, the Assessing Officer has made addition representing Rs.1,00,000/- out of agricultural income claimed by the assessee, for the assessment year 2010-2011, the addition representing Rs.1.6 lakhs under the head “agricultural income”, Rs.3000/- in respect of unexplained cash in hand, Rs.51,000/- under the head “unexplained investment in Choudhary hardware” and Rs.3,000/- under the head “unexplained expenditure”, for the assessment year 2011-12, the addition was only of Rs.1.6 lakhs under the head “agricultural income’ , For the assessment year 2012-13, addition of Rs.1.22 lakhs under the head “agricultural income” and for the assessment years 2013-14, 2014-15 and 2015-16, the disallowance were out of agricultural income as also reference was made to seized material namely MKS-03. It was the submission that after referring to MKS-03, which was the original cash memos reflecting the cash payments to various persons, the provisions of section 40A(3) of the Act was invoked to make the disallowance of payment in excess of Rs.20,000/-. It was the Printed from counselvise.com IT(ss)A Nos.16 to 22/RAN/2022 Assessment Years : 2009-10 to 2015-16 P a g e 3 | 5 submission that the MKS-3 containing seized materials were reflected in the books of account of the assessee and do not represent any incriminating materials. The said MKS-3 were only the original cash memos. It was the submission that said cash memos, multiple cash payments were also recorded which have been combined together by the Assessing Officer to make the stand that cash payments exceeded Rs.20,000/- for the purpose of invoking the provisions of section 40A(3) of the Act. It was the submission that no incriminating material had been found by the search party nor has been referred to by the Assessing Officer for the purpose of making any addition which showed the undisclosed income or investment or expenses by the assessee. It was the submission that in view of the decision of the Hon’ble Supreme Court in the case of Abhisar Buildwell (P.) Ltd., reported in [2023] 454 ITR 212 (SC),, as no incriminating material has been used by the AO for the purpose of making assessment, the assessment orders are liable to be set aside. 4. In reply, ld CIT DR submitted that the ld CIT(A) in his orders has specifically referred to MKS-3 and specified that said seized materials were the original cash memos reflecting the cash payments to various concerns. It was fairly greed by ld CIT DR that documents found in MKS-3 were in fact recorded in the books of account of the assessee and do not represent any undisclosed income or expenses of the assessee. It was the submission that the orders of ld CIT(A) are liable to be upheld. Printed from counselvise.com IT(ss)A Nos.16 to 22/RAN/2022 Assessment Years : 2009-10 to 2015-16 P a g e 4 | 5 5. We have considered the rival submissions. A perusal of the assessment orders for all the impugned assessment years clearly show that no incriminating material has been used by the Assessing Officer for making any addition in respect of undisclosed income. The additions as made in the assessment orders are basically the disallowance out of books of account of the assessee. This being so, in view of the proposition laid down by the Hon’ble Supreme Court in the case of Abhisar Buildwell (P.) Ltd.,(supra), we are of the view that as no incriminating material has been used by the AO for the purpose of making of addition in the case of the assessee, the impugned assessment years are liable to be set aside and we do so. 3. In the result, appeals of the assessee stands allowed. Order dictated and pronounced in the open court on 21/08/2025. SD/- SD/- (RATNESH NANDAN SAHAY) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER Ranchi ; Dated 21/08/2025 B.K.Parida, SPS (OS) Printed from counselvise.com IT(ss)A Nos.16 to 22/RAN/2022 Assessment Years : 2009-10 to 2015-16 P a g e 5 | 5 Copy of the Order forwarded to : By order Sr.Pvt.secretary ITAT, Ranchi 1. The Appellant : Tripurari Chaudhary, 147, Madarana, Vaishali, 2. The Respondent: Asst. Commissioner of Income Tax, Central Circle, Dhanbad 3. The CIT(A)- Patna-3 4. Pr.CIT, 5. DR, ITAT, Ranchi 6. Guard file. //True Copy// Printed from counselvise.com "