TUSHARKANT,CHENNAI vs. INCOME TAX OFFICER, CHENNAI

आयकर अपीलीय अधिकरण ‘ए’ न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI माननीय श्री एबी टी. वर्की, न्याययक सदस्य एवं श्री गगन गोयल लेखा सदस्य के समक्ष BEFORE HONOURABLE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 1120/Chny/2026 ननिाारण वर्ा /Assessment Years: 2022-23 Tusharkant, v. The Income Tax Officer, No.16, Krishnappa Agraharam Street, Non-Corporate Ward-12(1), G.P.O, Parrys, Chennai-600 001. Chennai. [PAN: AADPT5928K] (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Mr. S. Shyam Sundar, C.A, Ld. AR प्रत्यर्थी की ओर से /Revenue by : Ms. Anshu Sharawat, Addl. CIT, Ld. DR सुनवाईकीतारीख/Date of Hearing : 09.07.2026 घोषणाकीतारीख /Date of Pronouncement : 20.07.2026 आदेश / O R D E R PER GAGAN GOYAL, AM: This is an appeal preferred by the assessee against the order of Ld. Commissioner of Income Tax (A) / NFAC, (hereinafter referred as the ‘Ld. CIT(A)’) dated 17.12.2025 for the Assessment Year (hereinafter referred as the ‘AY’) 2022- 23.

GROUDS OF APPEAL 1. The order of the Learned Commissioner of Income Tax (Appeals) is opposed to Law and contrary to the facts and circumstances of the case and at any rate is opposed to the principles of equity, natural justice and fair play. Re: Error Apparent on the face of the record 2. That the Learned Commissioner of Income Tax (Appeals) has erred in law and on facts in passing the impugned order dated December 17,2025 on the basis of incorrect, erroneous and extraneous facts which do not pertain to the Appellant whatsoever, thereby rendering the entire order nullity in the eyes of law and liable to be quashed ab initio. Page 1 of 5

ITA No.1120/Chny/2026 (2022-23) Tusharkant 2.1 That the Learned Commissioner of Income Tax (Appeals) has grievously erred in law and on facts by failing to apply his mind to the facts and circumstances of the Appellant's case and has mechanically adopted facts pertaining to a different assessee/case, thereby violating the fundamental principles of natural justice and rendering the impugned order perverse, unsustainable and liable to be set aside 2.2 That the impugned order passed by the Learned Commissioner of Income Tax (Appeals) based on a complete misapprehension and misreading of facts, resulting in a gross miscarriage of justice to the Appellant, and the same deserves to be quashed in its entirety as the factual foundation upon which the order stands is fundamentally flawed and inapplicable to the Appellant. 2.3 That the Learned Commissioner of Income Tax (Appeals), having based his order on facts not pertaining to the Appellant, has acted without jurisdiction and/or in excess of jurisdiction, and the impugned order being coram non judice is null and void and deserves to be quashed. 2.4 That the learned Commissioner of Income Tax (Appeals) has erred in law and on facts by completely ignoring, disregarding and failing to consider the submissions, evidence and materials placed on record by the Appellant, and instead relying upon extraneous and inapplicable facts, thereby rendering the order arbitrary, capricious and unsustainable in law. 2.5 That the impugned order is vitiated by material irregularity and patent illegality, as the learned Commissioner of Income Tax (Appeals) has proceeded on the basis of Incorrect facts which form the very foundation of the order, and such fundamental error renders the entire order bad in law and liable to be set aside. 2.6 That the learned Commissioner of Income Tax (Appeals) has failed to conduct a fair and independent adjudication of the Appellant's case, and by basing the order on facts not pertaining to the Appellant, has denied the Appellant's statutory right to a reasoned and fact- specific appellate order. 2.7 That the impugned order being based on incorrect facts is wholly unsustainable in law and is liable to be quashed, as settled legal principles mandate that an order passed on the basis of non-existent or incorrect facts cannot be sustained and must be set aside. Re: Unexplained Cash credits 3. The Learned Commissioner of Income Tax (Appeals) erred both in law and on facts in upholding the addition made under Section 68 of the Income Tax Act, 1961, without appreciating that the appellant had duly discharged the primary onus cast upon him under the said section. The appellant had furnished complete details explaining the nature and source of the credits. The amounts were received through proper banking. Channels, and the identity of the lender was duly established by furnishing her Permanent Account Number (PAN). Once the identity of the creditor and the fact of receipt through banking channels were established, the initial burden under Section 68 stood discharged. Therefore, the addition made by treating the said transactions as unexplained cash credits is arbitrary, unjustified, and bad in law. 3.1 The Learned Commissioner of Income Tax (Appeals) erred in sustaining the addition. Merely on the ground that certain documentary evidences such as Income Tax Return, bank statements of the lender, audited accounts, loan agreement, or balance confirmation etc.

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ITA No.1120/Chny/2026 (2022-23) Tusharkant were not furnished. The authorities below failed to appreciate that the loan was received from the appellant's spouse, whose PAN and identity were fully disclosed. The bank statement of the appellant clearly reflected the credit entries in the name of the lender. The transaction being routed through banking channels establishes its genuineness. The Learned Assessing Officer and the Learned Commissioner of Income Tax (Appeals) failed to appreciate that once identity and source of receipt through banking channels were demonstrated, the addition could not be sustained merely on technical or hyper-technical grounds. 3.2 That the Learned Commissioner of Income Tax (Appeals) erred in failing to ascertain from the Assessing Officer of the lender, whether in their respective return the lender had shown existence of such amount of money and had further shown that those amounts of money had been lent to the appellant. The Learned Assessing Officer failed to exercise the statutory powers vested under Section 133(6) of the Income Tax Act, 1961, or to issue summons under Section 131 to independently verify the genuineness of the loan transaction and the creditworthiness of the lender. It is settled law that where the assessee furnishes basic details establishing identity and provides prima facie evidence, the burden shifts upon the Assessing Officer to conduct necessary enquiry. Failure to do so renders the addition unsustainable. Hence, the addition sustained under Section 68 is liable to be deleted. 3.3 That the Learned Commissioner of Income Tax (Appeals) have erred in sustaining the addition under Section 68 without conducting any independent enquiry or exercising powers under Section 133(6) or 131 of the Act. It is submitted that the issue is squarely covered by the decision of the Hon'ble ITAT, Pune Bench in Anant Keshav Rajegaonkar v. ACIT, Central Circle-2, Nashik (ITA Nos. 1249 to 1252/PUN/2024), wherein it was held that once the assessee discharges the initial burden by furnishing PAN details and demonstrating that the transaction was carried out through banking channels, the onus shifts to the Revenue. In the absence of any contrary material brought on record by the Department, addition under Section 68 cannot be sustained. Accordingly, the impugned addition is liable to be deleted. Re: Computing tax under S.115BBE 4. Without prejudice to the above, the appellant submits that Learned Commissioner of Income Tax (Appeals) erred in upholding the action of the Learned Assessing Officer in computing taxes u/s 115BBE of the Income Tax Act. The appellant objects the additions made under section 68 as unexplained cash credits and hence objects taxes being computed u/s 115BBE. Re: S.40a (ia) Disallowance 5. That the Learned Commissioner of Income Tax (Appeals) erred in upholding the action of the Learned Assessing Officer in making a disallowance under Section 40(a)(ia) of the Act to the tune of Rs. 1,23,600/- towards alleged failure in proving compliance with the provisions of this section, out of which an amount of Rs. 54,000/- is disputed herewith. 5.1 The copy of Form 16A for the TDS deduction is enclosed herewith. Prayer WHEREFORE, in light of the above grounds and the established legal principles, the Appellant most respectfully submits that:

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ITA No.1120/Chny/2026 (2022-23) Tusharkant a) The impugned order of the learned Commissioner of Income Tax (Appeals) is vitiated by fundamental and fatal errors of fact, being based on facts which do not pertain to the Appellant; b) Such factual errors go to the root of the matter and render the entire order a nullity in law; c) The order being based on incorrect facts amounts to non-application of mind, violation of natural justice, and denial of fair adjudication; d) The settled legal position unequivocally supports the quashing of orders based on incorrect or non-existent facts; e) The impugned order deserves to be quashed ab initio and set aside in its entirety, and the matter may be remanded back to the learned Commissioner Of Income Tax (Appeals) for fresh adjudication on the basis of correct facts pertaining to the Appellant after providing due opportunity of hearing, f) On the basis of the above facts the additions to the tune of Rs. 37,50,014/- as unexplained cash credits u/s 68 made by the Assessing Officer is not in accordance with law. g) On the basis of the above facts the additions to the tune of Rs. 54,000/- as disallowance u/s 40a (ia) made by the Assessing Officer is not in accordance with law. Without prejudice to the above grounds, the Appellant reserves the right to add, amend, alter, modify or withdraw any of the grounds of appeal at the time of hearing. 2. The brief facts of the case are that the assessee filed his return of income on 25.12.2022 declaring total income at Rs. 7,71,440/-. The case of the assessee was selected for scrutiny under CASS. In this case the assessee was requested to furnish details of unsecured loans amounting to Rs. 1, 41, 10,263/- shown in the Balance-Sheet for the A.Y. under consideration. Ultimately, after due deliberation between the assessee and AO the case of the assessee was assessed after making addition of Rs. 37,50,014/- u/s. 68 of the Act and Rs. 1,23,600/- u/s. 40(a)(ia) of the Act. The assessee being aggrieved with the same preferred an appeal before the Ld. CIT (A), who in turn dismissed the appeal of the assessee. The assessee being further aggrieved with the same preferred the present appeal before us.

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ITA No.1120/Chny/2026 (2022-23) Tusharkant the assessee relying on the facts of some other case as one can see in para 5 of the order. Moreover, the whole order is incorrect as far as the facts applied. All the facts, name and figures considered and discussed are vague and has no relevance in the appeal under consideration. In view of this, grounds raised by the assessee are allowed for statistical purposes and the matter is restored back to the file of the Ld. CIT (A) for fresh hearing of the matter after giving proper opportunity of being heard to the assessee.

Sd/- Sd/- (एबी टी. वर्की) (गगन गोयल) (ABY T. VARKEY) (GAGAN GOYAL) न्याययक सदस्य/JUDICIAL MEMBER लेखा सदस्य/ACCOUNTANT MEMBER चेन्नई/Chennai, ददनाांक/Dated: 20th July, 2026. KB आदेश की प्रयतललपप अग्रेपषत/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT, Chennai /Madurai/Coimbatore/Salem 4. पवभागीय प्रयतयनधि/DR Digitally signed 5. गार्ड फाईल/GF K BABU by K BABU Date: 2026.07.27 11:25:34 +05'30'

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