GURMEET SINGH BAGGA,MUMBAI vs. JURISDICTIONAL ASSESSING OFFICER, MUMBAI

IN THE INCOME-TAX APPELLATE TRIBUNAL“G” BENCH,
MUMBAI
BEFORE JUSTICE (RETD.) C. V. BHADANG, PRESIDENT
&
SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER
Gurmeet Singh Bagga
37, Gurunanak Market, Dr.
Ambedkar
Road,
Dadar
(East), Mumbai – 400014,
Maharashtra v/s.
बनाम
Income
Tax
Officer,
Juri ictional Ward– 20(1)(1),
Piramal
Chambers,
Mumbai,
AO Type W, AO Number 1,
Range Code 174,Mumbai – 400
012,Maharashtra
स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAIPB6157H
Appellant/अपीलार्थी
..
Respondent/प्रतिवादी

Appellant by :
Shri Anil Sathe,AR
Respondent by :
Shri Swapnil Choudhary, (Sr. DR)

Date of Hearing
11.11.2025
Date of Pronouncement
21.11.2025

आदेश / O R D E R

PER PRABHASH SHANKAR [A.M.] :-

The present appeal arising from the appellate order dated
07.07.2025 is filed by the assessee against the order passed by the Learned Commissioner of Income-tax (Appeals)/National Faceless
Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] pertaining to assessment order passed u/s. 143(3) r.w.s. 147 of the Income-tax Act,
1961 [hereinafter referred to as “Act”] dated 27.12.2017 for the Assessment Year [A.Y.] 2010-11. P a g e | 2
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai

Gurmeet Singh Bagga, Mumbai the assessee before an Australian Court. In absence of any cogent reply, he taxed the entire amount stated in the TEP of Rs 1.80 cr. as Unexplained Expenditure u/s 69C of the Act.
4. We take up ground nos. 2 to 5 first wherein the assessee on merits has challenged the addition made u/s 69C of the Act. We find that the ld.CIT(A)upheld the addition stating that the addition was rightly made on the admitted affidavit of the assessee before the court wherein he had stated before him that marriage expenditure was met from various sources including his father and wife though he claimed that he did not remember of any such acceptance of having spent Rs
1.80 cr. on daughter’s marriage. However, since there was no supporting evidence, the addition was upheld.
5. The ld.AR has vehemently agitated the addition. It is submitted that the assessee had made a detailed submission alongwith certain annexures before the appellate authority. Copy of the Paper book containing 31 pages has been submitted before us as well. Attention has been drawn to written submission dated 07.04.2022 made before him(pages 3 to 6 of paper book).This submission also forms part of the appellate order from pages 5 to 9.Relevant parts thereof are considered here as reiterated by the ld.AR. It was contended that assessee’s

P a g e | 4
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai daughter had filed a petition for divorce. Subsequent to the divorce, his former son-in-law Mr. Gagandeep Singh Jolly filed a TEP stating that the assessee had spent Rs 1.80 cr. on his daughter’s marriage. Based on the said TEP, assessment was reopened in this case. It in this regard, the ld.AR has submitted that the Assessing Officer had relied on the bald statements of former son in law of the assessee and his family members.
There is no corroborative evidence of any nature to support that the assessee had spent the said amount. The contents of the alleged affidavit have neither been reproduced the assessment order nor has the assessee been confronted with the same. The sworn statements of the assessee’s former son in law and his father did not indicate or refer to the alleged expenditure. In fact, the affidavit of Mr. Jotinder Singh Jolly, the father of Mr. Gagandeep Singh Jolly, in the divorce proceedings refers to a court marriage and the reception hosted by him in New Delhi (Page no.
19 of paper book). There is no reference whatsoever to the alleged expenditure of Rs. 1.80 cr. by the assessee. It is further contended that the ld.CIT(A) also erred in confirming the action of Assessing officer on the basis of bland allegations in TEP by the appellant’s former son in law without providing a copy thereof to the appellant. The AO treated the petition filed by son-in-law as a reasonable ground to entertain the prima facie reason so as to believe that the income has escaped

P a g e | 5
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai assessment. The tax evasion petition filed was neither given on oath nor it is tested by cross examination and, therefore, such a statement could not be treated as substantive evidence to reopen assessment proceeding.
The authorities concerned had not brought before the assessee any material so as to constitute that an expenditure of Rs 1.80 cr. was spent by him on his daughter’s marriage. The ld.CIT(A) erred in not appreciating that the assessee cannot be asked to prove a negative fact.
5.1 It was further submitted that the sole addition to declared income had been unexplained expenditure allegedly incurred on the marriage of his daughter in December, 2009. It is contended that his daughter had to undergo a very tumultuous and unhappy marriage, when she had to reside in Australia with her husband and in-laws. Her statement to the Australian authorities makes it clear the hardships and mental suffering that she had to undergo. The TEP which forms the basis of the assessment has been filed by my daughter’s former husband deliberately to cause harm and injury to him and is totally malicious.
There is not an iota of truth in what has been stated therein.
5.2 A plain reading of the assessment order would make it clear that the AO has merely relied on the tax evasion petition, without their being a shred of corroborative evidence. It is stated further that in order

P a g e | 6
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai to rebut the false claims of his former son-in-law which in any case were blatantly false and without any evidence, he relied on certain statements in the Australian court by his son-in-law and his father which amply brought out the fact that what they were saying is absolute falsehood.
The whole proceedings were so painful that he did not recollect having made any statement in regard to the alleged expenditure, sources of which are claimed to have been unexplained to the extent of Rs. 1.80 cr.
In letter to the AO, he had clearly stated that on account of his precarious financial situation the expenditure in regard to his daughter’s marriage was largely incurred by his father Sri Narinder Singh Bagga, and some of the expenses were met out of support by my relatives. The assessee filed certain supporting documents such as the return of income of his HUF and wife Smt. Paranjeet Kaur Bagga for the relevant year. A major part of the expenditure was incurred by his father.
However, he unfortunately expired immediately after the marriage on 9thMay 2011 and his death certificate was enclosed.
5.3
It was stated that in any event the expenditure was never
Rs. 1.80 cr. as alleged but was a very small expenditure not exceeding a couple of lakhs, for certain rituals which were necessary in accordance with tradition. The AO chose to believe the statement in the tax evasion petition filed by his erstwhile son-in-law without making any enquiry or P a g e | 7
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai verification whatsoever. In order to rebut the claim that he spent Rs.
1.80 cr.,he filed sworn statement of my son-in-law Gagandeep Singh
Jolly dated 16thNovember 2015, made before the Australian authorities, the sworn statement of the father of my son-in-law Mr. Jotinder Singh
Jolly dated 14thNovember 2015 before the Australian authorities and the statement of his daughter Simranjeet Bagga, made before the police authorities which brings out the cruelty to which she was subjected. It is contended that the statement of his son-in-law on 16thNovember 2015
did not contain a word about the expenditure that he allegedly incurred on the marriage. Further, the statement of his son-in-law’s father clearly brought out that no expenditure was incurred by him. This sworn statement of Sri Jotinder Singh Jolly also did not make any reference at all to the alleged expenditure incurred by him. In fact, it clearly brought out that the marriage was a court marriage at which obviously no expenditure could have been incurred and as far as the traditional marriage and reception party in New Delhi was concerned, the same was arranged by in-laws and not by him. It is pleaded that the statement in the tax evasion petition was an afterthought meant only to harm him and his family. Statement of his daughter makes it clear that she was suffering deep mental agony in her married life. She repeatedly requested him to help to come out of the marriage which was taking a P a g e | 8
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai toll on her mental and physical health. It is possible that he made some statement regarding the expenditure incurred by him on the marriage, for the sole purpose of ensuring that there was an early dissolution to the marriage. It is an established legal proposition that a statement without any corroboration whatsoever cannot be relied on, much less form the basis of an addition under section 69C of the Act.
6. We have carefully considered all the relevant facts of the case, rival submissions. It evident from the assessment order that apart from relying on the tax evasion petition alleging substantial expenditure incurred by the assessee based on his purported affidavit in the court, we do not find any other material fact bought on record to corroborate the allegation. Apparently, the AO failed to conduct any enquiry and investigation to buttress his observation. Even the first appellate authority has completely glossed over the detailed submissions made by the assessee before him, although the same is reproduced in the appellate order. It was incumbent on the authorities below to bring on record further corroborative details to strengthen their belief. However, they have jumped to an adverse conclusion without appreciating the facts of the case in proper perspective. The alleged contents of the TEP cannot be the only basis for any adverse finding ,more so in the light of the fact that the contents therein could have been made only to settle

P a g e | 9
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai scores especially in view of the fact that it was a case of marital discord leading to divorce proceedings. The ld.CIT(A) has failed to appreciate that the allegation of huge expenditure is nowhere supported from the contents of the affidavits of the complainant as also his father.
6.1 The AO did not bring on record any evidence to prove that such huge expenditure was actually spent by the assessee. He did not conduct any independent enquiry relating to expenditure instead merely relied upon the allegations made in TEP.
6.2 Section 69C of the Act allows for the addition of unexplained expenditures, if the assessee fails to provide satisfactory explanations.
The language of Section 69C of the Act stipulates two conditions necessary for deeming the expenditure incurred by the assessee to be his income for the said year, (i) where no explanation is offered; and (ii) where the explanation offered is not found to be satisfactory. At the same time, the use of the word "may" in the aforesaid provision makes the deeming provision discretionary and not mandatory. In other words, even if no explanation is offered or it is found to be unsatisfactory, it is not mandatory to treat such unexplained expenditure to be the income of the assessee. Moreover, considering the mental stress and agony with which the assessee must have been passing through the relevant period,

P a g e | 10
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai the statement in the court could also be considered to have been made in made under severe duress and no reliance could be placed on the same.
6.3 To conclude, in the absence of proper enquiry and sufficient evidences, we find no reason to confirm the addition made by the A.O.
Therefore, allowing the above grounds of appeal, we reverse the ld.CIT(A) order and direct the Assessing Officer to delete the addition.

Place: म ुंबई/Mumbai
ददनाुंक /Date 21.11.2025
Lubhna Shaikh / Steno

P a g e | 11
A.Y. 2010-11

Gurmeet Singh Bagga, Mumbai

आदेश की प्रतितलति अग्रेतिि/Copy of the Order forwarded to :
1. अपीलार्थी / The Appellant
2. प्रत्यर्थी / The Respondent.
3. आयकर आयुक्त / CIT
4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT,
Mumbai
5. गार्ड फाईल / Guard file.

सत्यावपि प्रवि ////
आदेशानुसार/ BY ORDER,

उि/सहायक िंजीकार (Dy./Asstt.