DEEPAK JASWANT JAIN,VADODARA vs. INCOME TAX OFFICER, WARD 1(2)(1), VADODARA, VADODARA

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ITA 1336/AHD/2026Status: DisposedITAT Ahmedabad29 July 2026AY 2018-193 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the reopening was based on vague information and the addition was made without proper substantiation. The assessee had disclosed the loan and offered interest income for taxation.

What were the facts?

The AO received information about loans advanced by the assessee to Avani Group and reopened the assessment. The assessee clarified that loans were given to an individual from Avani Group and interest income was offered for taxation.

What were the issues?

Whether the reopening of assessment was valid and whether the addition of undisclosed interest income was justified based on the evidence.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148AD,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: Shri Sanjay Garg

For Appellant: Shri Anant Madhani, AR
Hearing: 23/07/2026Pronounced: 29/07/2026

आदेश/O R D E R The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (in short “NFAC”), Delhi [hereinafter referred to as ‘Ld. CIT(A)’] dated 23/03/2026 passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2018-19.

2.

The assessee in this appeal is aggrieved by the action of the Ld. CIT(A) in confirming the addition of Rs. 61,285/- made by the Assessing Officer (in short “the AO”) on account of undisclosed interest income.

3.

The brief facts of the case are that the AO received information from the Investigation Wing that the assessee had advanced loans to

ITA No.1336/Ahd/2026 Deepak Jaswant Jain vs. ITO Asst.Year 2018-19 2 one Avani Group. Accordingly, show cause notice u/s 148A of the Act was issued to the assessee. The assessee in its reply denied having given any loan to the Avani Group and asked the AO in his reply to supply the necessary information/details relied upon by the AO in this respect. However, the AO proceeded to reopen the assessment by passing the order u/s 148AD of the Act, observing that the reply given by the assessee was general in nature.

4.

During the assessment proceedings, the assessee submitted that he had not given any loan to the Avani Group but to one Shri Harsh D Shah of the Avani Group. The amount was duly disclosed in his books of account and interest @ 12% was charged on the said amount and the said interest income was offered for taxation. The AO, however, noted that as per the information received as per the Investigation Wing, the assessee had received interest income of Rs. 3,06,426/-, whereas, the assessee had shown interest income from the said party of Rs. 2,45,141/-. He, therefore, added the differential amount of Rs. 61,285/- into the income of the assessee.

5.

I have heard the rival contentions and perused the material on record.

6.

In this case, not only the reopening of the assessment has been made on vague ad general information without verification but also the impugned addition has been made on the basis of general information of the Investigation Wing. The only information received by the AO from the Investigation Wing but that the assessee had advanced loans

ITA No.1336/Ahd/2026 Deepak Jaswant Jain vs. ITO Asst.Year 2018-19 3 to the Avani Group. It was not the case of the AO that the assessee had advanced loan from any undisclosed sources of income. Merely, the advancement of loan from his accounted income would not in any manner lead to the conclusion that the income of the assessee has escaped assessment. Further, the assessee had duly disclosed the said loan transaction with Harsh D Shah and duly offered for taxation the interest income. However, the AO went on to add the small amount of Rs. 61,285/- holding that the assessee has received higher interest income than disclosed, without even pointing out as to what were the document and what were nature of the document and how he arrived at such a conclusion. The addition made by the AO, is, therefore, not sustainable and the same is hereby order to be deleted.

7.

The appeal of the assessee stands allowed.

Order pronounced in the Open Court on 29/07/2026.

Sd/- (Sanjay Garg) Judicial Member अहमदाबाद/Ahmedabad, िदनांक/Dated 29/07/2025 Tanmay, Sr. P.S. TRUE COPY आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु� अपील ( ) / The CIT(A)-(NFAC) 5. िवभागीय �ितिनिध आयकर अपीलीय अिधकरण अहमदाबाद /DR,ITAT, Ahmedabad. , , 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad

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