DCIT-CC-4(3), MUMBAI, MUMBAI vs. DHENU BUILDCON INFRA LIMITED, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH MUMBAI BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER HON’BLE SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER ITA No. 3985/Mum/2024 (Assessment Year: 2012-13) DCIT-CC-4(3), Vs. Dhenu Buildcon Infra Room No. 420, 4th Floor, Limited, Kautilya Bhawan, BKC, Office No. 4 Building Mumbai, No. 4, Vahatuk Nagar, Maharashtra- 400051 Amboli, Andheri west- Maharashtra- 400058 PAN/GIR No. AAACT1951G (Revenue) (Assessee) CO No. 203/Mum/2025 In ITA No. 3985/Mum/2024 Dhenu Buildcon Infra Vs. DCIT-CC-4(3), Limited, Room No. 420, 4th Floor, Office No. 4 Building No. Kautilya Bhawan, BKC, 4, Vahatuk Nagar, Mumbai, Amboli, Andheri west- Maharashtra- 400051 Maharashtra- 400058 PAN/GIR No. AAACT1951G (Applicant) (Respondent) Assessee by Shri Kapil Hirani, Adv. Revenue by Shri Umashankar Prasad, (CIT DR) & Shri Annavaram Kosuri, Sr. AR Date of Hearing 21.05.2026 Date of Pronouncement 14.07.2026

2 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) आदेश / ORDER PER SANDEEP GOSAIN, JM: The present appeal has been filed by the Revenue and the cross appeal by Revenue challenging the impugned order dated 21.06.2024 passed u/s 250 of the Income Tax Act, 1961 ('the Act'), by the CIT(A) for the assessment year 2012-213. The following grounds raised by Revenue are reproduced below: i. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of rs. 10,26,00,000/- as unexplained cash credit u/s. 68 of the Act without properly appreciating the fact of the case. 2. The solitary ground raised by the Revenue relates to challenging the order of Ld. CIT(A) in deleting the additions of Rs. 10,26,00,000/- made by Assessing Officer on account of unexplained cash credit under Section 68 of the Income Tax Act. 3. We have heard the Counsels of both the parties, perused the material placed on record, judgments cited before us and also the orders passed by the Revenue Authorities. 4. From the records, we noticed that the assessee is a listed company whose shares are listed and traded on BSE

3 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) and is engaged in the business dealing in textiles. The assessee filed its return of income for the year under consideration thereby declaring income of Rs. 7,54,784/-. However, the search and seizure action under Section 132 of the Income Tax Act was carried out in the case of Raj Kumar Kedia Group on 13.06.2014 by DDIT(Inv.) Delhi. The main allegation against the group was that they were engaged in providing various types of accommodation entries to large number of beneficiaries all over the country. In this regard, statements of various persons including Raj Kumar Kedia, Manish Arora, Natwar Lal Daga were also recorded to explain the modus operandi of providing long term capital gains accommodation entries and the role of various intermediaries. 5. It was found by the AO after analyzing the investigation of assessee company and trade data that the assessee company had been abused for generating illicit long term capital gain and thus added cash credit amounting to Rs. 10,26,00,000/- received by the assessee under the head “share capital” during the year under consideration, as reflected in the balance sheet of the assessee company under Section 6A of the Act under the heard “income from other sources”.

4 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) 6. Whereas during the assessment proceedings, it was specifically pleaded by the assessee that the said Raj Kumar Kedia is not connected in any manner whatsoever with the assessee and even otherwise no incriminating document was found during the search of Raj Kumar Kedia in relation to the assessee. Even then, vide application dated 10.05.2016, the assessee specifically requested copies of the satisfaction note and copies of alleged incriminating material connected to the assessee, but even in spite of specific request, the same was never provided to the assessee. The application made by the assessee in this regard has already been placed in the paper book at page no. 167. 7. Even during the year under consideration, as per the facts, the assessee received share capital and premium from various parties whose details have already been placed on record at paper book page No. 57-84. Without appreciating any of the documents placed on record, the addition was made by the AO on account of unexplained cash credit thereby treating the amount of share capital as received during the year as non-genuine. The said additions made by the AO were primarily on the basis of Tally Data seized from Mr. Raj Kumar Kedia, statement recorded of the various

5 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) persons including that of R.K. Kedia, but is important to mention that none of the above information/evidences were provided to the assessee for rebuttal which grossly violates the principles of natural justice. Moreover, AO could not connect allege incriminating material with the assessee in any manner during the entire course of assessment proceeding rather the assessment had been made solely by simply relying on the submissions of the aforementioned parties without any corroborative evidences. 8. However, after considering the entire documentary evidences as relied on and placed on record by the assessee which contains copy of details of name, PAN, Address & bank details of the allottees, banking statements, copies of confirmation of accounts, copy of party-wise details of Sundry Creditors, party wise details of Revenue from operations, copy of party-wise details of indirect expenses and even the breakup of Revenue from operations indicating nature of the same for the year under consideration. The assessee has also placed on record details and copies of party-wise details of unsecured loans along with their ledger, copy of bank books, copy of replies and notice issued under the Act.

6 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) 9. After having meticulously gone through the factual position as relied upon and narrated by the assessee, the Ld. CIT(A) deleted the additions made by the Assessing Officer by placing reliance on the decision of the coordinate bench of ITAT in the case of Mystic Electronics Ltd. vs. DCIT in ITA No. 5867/Mum/2019 for AY 2014-15 and in ITA No. 929/MUM/2020 for AY 2015-16 decided on 24.07.2023. The operative portion of the decision in the case of Mystic Electronics Ltd. is at paper book page No. 39-55 and the operative portion in para 10 is also reproduced herein below;-

7 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) department is not able to tax beneficiary then only a substantial addition can be made in the hands of the assessee company. In this case, the only addition which is warranted in the hands of Assessee Company is amount of commission earned on arranging long term capital gains / short term capital losses. If investor in such type of company is able to prove its source of investment, then no addition can be made in the hands of assessee company being genuine transaction as identity, genuineness and creditworthiness is automatically established and in vice-versa position also amount of investment is taxable in the hands of investor, then also not taxable in the hands of assessee company, being double taxation. In view of this, the addition made u/s.68 amounting to Rs. 23,07,50,000/- is unwarranted. Hence, this amount of addition is directed to be deleted minus addition already, deleted by Ld. CIT(A) amounting to Rs. 18,10,62,500/-. Resultantly, ground no. 4 with its sub grounds is allowed.

8 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) any of the superior judicial authority. Since additions in the present case were also made under the identical facts and circumstances with that of Mystic Electronics, therefore, CIT(A) while rightly relying upon the decision of coordinate Bench, deleted the additions in the case of assessee as well. 11. Even Ld. DR appearing on behalf of the Department could not distinguish the facts of the present case from that of Mystic Electronics Ltd. and could not justify his arguments with regard to non-application of the decision of Mystic Electronics Ltd. under the facts of the present case. It is also important to mention here that the year under consideration in the present case is AY 2012-13 which is prior to the amendment made to the proviso of Section 68 of the Act, accordingly, is also covered by the decision of Hon’ble Supreme Court in the case of Lovely Exports 317 ITR 218(SC). Moreover, the case of the assessee is also covered by the decision of Hon’ble Jurisdictional High Court in the case of CIT vs. Gagandeep Infrastructure Pvt. Ltd. (2017) 394 ITR 680 (Bombay HC). 12. After having considered the entire factual position and considering the fact that the evidences relied upon by the Assessing Officer have not been produced for rebuttal to the assessee and even the SEBI report filed by the Department

9 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) is in relation to Mr. Jayant Indulal Sethna who is an independent share broker and is not connected in any manner whatsoever with the assessee. Whereas the shares of the assessee are still actively being traded on the stock exchange. 13. Therefore, considering the totality of the facts and circumstances as discussed above, we see no reasons to interfere into or to deviate from the lawful findings so recorded by Ld. CIT(A) in deleting the additions after relying upon the decision of coordinate bench of ITAT under the identical set of facts, therefore, we maintain judicial consistency and judicial discipline and also keeping in view that no new facts or circumstances have been put forth by Ld. DR in order to controvert or rebut the findings recorded by Ld. CIT(A). Thus, we find no reasons to interfere into the detailed findings recorded by Ld. CIT(A), thus, grounds of appeal raised by the revenue stands dismissed. 14. Consequently, the appeal filed by the revenue also stands dismissed.

10 ITA No. 3985/Mum/2024 & CO No. 203/Mum/2025 (Dhenu Buildcon Infra Limited) CO No. 203/Mum/2025 15. Since we have already dismissed the appeal filed by the Revenue by upholding the order of Ld. CIT(A), therefore, there is no need to adjudicate the grounds raised in the Cross Objection filed by the assessee.

Order pronounced in the open court on 14.07.2026

Sd/- Sd/- (BIJAYANANDA PRUSETH) (SANDEEP GOSAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated 14/07/2026 Z.U., PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलार्थी / The Assessee 1. प्रत्यर्थी / The Respondent. 2. संबंधित आयकर आयुक्त / The CIT(A) 3. आयकर आयुक्त(अपील) / Concerned CIT 4. धिभागीय प्रधतधिधि, आयकर अपीलीय अधिकरण,मुम्बई/ DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. 6. आदेशानुसार/BY ORDER, सत्याधपत प्रधत //True Copy//

उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai