PRASAD NIMMAGADDA, HYDERABAD. vs. ACIT., CIRCLE 17(2), HYDERABAD.

PDF · subscribers
ITA 1567/HYD/2025Status: DisposedITAT Hyderabad03 July 2026AY 2016-179 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal allowed the assessee's appeal for statistical purposes, setting aside the CIT(A)'s order. It granted one more opportunity to the assessee to present supporting evidence and explanations before the CIT(A).

What were the facts?

The assessee's appeal concerns additions made to his income for unexplained credits in a foreign bank account and denial of foreign tax credit. The assessee claimed he was unable to present evidence due to being in custody for financial offenses.

What were the issues?

Whether the assessee was prevented by sufficient cause from presenting evidence and whether a fresh opportunity should be granted for explaining foreign bank account credits.

Which sections of the Income-tax Act were involved?

Section 68,Section 90

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI VIJAY PAL RAO & SHRI MANJUNATHA G

Pronounced: 03.07.2026

आदेश / ORDER

PER VIJAY PAL RAO, VICE PRESIDENT:

This appeal by the Assessee is directed against the Order dated 23.07.2025 of the learned CIT(A)-12, Hyderabad, for the assessment year 2016-2017.

2.

The assessee has raised the following grounds of appeal:

1.

“The Order of the learned Commissioner of Income Tax (A) 12, Hyderabad is not correct either on facts or in law and in both.

2.

The Learned CIT(A) 12, Hyderabad erred in sustaining the addition of Rs.1,17,96,000/- being foreign salary received from M/s Globex Holdings Pte Ltd, Singapore, which is taxable only in Singapore in terms of Article 15 of the India-Singapore DTAA since the appellant's stay in Singapore was less than 183 days.

3.

Without prejudice, the Learned CIT(A)-12, Hyderabad erred in dismissing the claim for foreign tax credit of taxes paid in Singapore, as relief under section 90 of the Act read with the DTAA could not be denied when substantive evidence was available on record.

3 ITA.No.1567/Hyd./2025 4. The Learned CIT(A)-12, Hyderabad, erred in upholding the addition of Rs.1,45,43,306/- as unexplained credits appearing in the appellant's foreign bank account, ignoring necessary evidence filed.

5.

The appellant craves leave to add, amend, modify, rescind, supplement or alter any or more grounds of appeal stated herein above either before or at the time of hearing of this appeal.”

3.

At the time of hearing, the learned Authorised Representative of the Assessee has submitted that the assessee was in custody in respect of some financial transactions of Singapore Dollars [in short “SGD”] credited in the bank account of the assessee which is also the subject matter of the addition. Therefore, the assessee could not file the relevant supporting evidence as well as properly represented before the authorities below and said matter is still pending adjudication before the Hon'ble Supreme Court in Civil Appeal Nos.12561 to 12566/2025. The learned Authorised Representative of the Assessee has thus submitted that because of the criminal case the assessee was confined in the jail for more than 02 years and therefore, he was not able to collect the relevant evidence and was not properly represented before the learned CIT(A). He has thus

4 ITA.No.1567/Hyd./2025 contended that the assessee may be given one more opportunity to file the relevant record as well as supporting evidence before the learned CIT(A).

4.

On the other hand, the learned DR has objected to grant of one more opportunity to the assessee and submitted that the Assessing Officer as well as the learned CIT(A) has granted sufficient opportunities to the assessee and even the additional evidence filed by the assessee before the learned CIT(A) was also forwarded to the Assessing Officer for remand report however, the assessee failed to explain the source of the credits in the bank account. He has relied upon the Orders of the authorities below.

5.

We have considered the rival submissions and carefully perused the Orders of the authorities below. The Assessing Officer has made the addition of Rs.2.63 crores on account of credits in the bank account of the assessee in SGD currency for want of explanation of the source. On appeal, though the assessee has filed some documents however, the same were not found to be satisfactory to explain the source of the credits in the bank account of the assessee. The

5 ITA.No.1567/Hyd./2025 learned CIT(A) has recorded these facts in Para nos.6.5.5 to 6.5.7 as under:

“6.5.5. I have considered the submission of the appellant, additional evidences and the remand report submitted by the Assessing Officer. In this regard, it is submitted that the remand report was duly forwarded to the appellant, offering an opportunity to furnish objections, comments or rebuttal submissions, if any, on the remarks made by the AO. However, the appellant failed to avail the opportunity, as no response, explanation or written submission was received from the appellant within the time allowed or even thereafter. 6.5.6. The appellant only on two occasions replied stating that "The assessee requests time till 20th February 2024 to submit the detailed reply to the notice". And on another time, it was replied that "Gathering of material from multiple sources and preparing paper book requires time till 21.06.2025. Inconvenience is deeply regretted". However, till date no counter comments were furnished by the appellant. Therefore, FINAL opportunity was provided to the appellant vide notice dated 07.07.2025 fixing the hearing on 09.07.2025. There is no response from the appellant even on 09.07.2025. 6.5.7. From the above, it is clear that neither the appellant nor the Authorised Representative appeared nor filled written submissions in support of ground of appeal on the dates posted for hearing on several occasions as mentioned above.”

6 ITA.No.1567/Hyd./2025 5.1. Thus, the learned CIT(A) has observed that despite various opportunities the assessee has not filed any response to the notice. Further, the learned CIT(A) has held in Para nos.6.5.10 to 6.5.15 as under:

“6.5.10. The absence of any counter-submission from the appellant, despite due and adequate opportunity, implies that the appellant has not controverted or disputed the findings and observations made by the AO in the remand report. Hence, the contents of the remand report stand unrebutted and unchallenged, and the same are taken into consideration as part of the adjudication of this appeal. 6.5.11. After carefully considering the facts of the case, the submissions made by the appellant, the additional evidence filed, and the detailed remand report of the Assessing Officer, it is clear that the appellant has not satisfactorily explained the credits totaling SGD 2,95,896.35, equivalent to Rs.1,45,43,306/-, appearing in his Singapore OCBC Bank account. Despite being given several chances both during the assessment and appellate proceedings, the appellant failed to furnish proper documents to substantiate the nature and source of the credits. 6.5.12. Specifically, in respect of the credit of SGD 2,80,000/, the appellant claimed it was a personal loan from Mr. Tan Chau Chuang; however, the material on record shows conflicting entries, including a transfer of SGD 2,06,596.33 to a third party, raising serious doubts about the genuineness of the transaction, and no identity proof or bank statement of the alleged lender was furnished.

7 ITA.No.1567/Hyd./2025 6.5.13. Similarly, for the credits of SGD 326.35 and SGD 3,570, the appellant initially described them as "Alsai Rental Deposits" during assessment but later changed the explanation to "loan refunds" without any credible supporting documents, making the explanation unreliable. 6.5.14. In the case of the SGD 12,000 credit claimed to have been received from M/s EIJI Holdings Pte Ltd, the appellant failed to produce his own bank statement for March 2016, and the financials of EIJI Holdings did not reflect any such transaction, leaving the claim unverified. Further, the appellant was repeatedly given opportunities to present his case during the appellate proceedings, but he failed to appear or file any further evidence or counter-submissions despite several hearing notices, including a final notice dated 07.07.2025. 6.5.15. The appellant only sought time extensions on two occasions but ultimately failed to submit any explanation or documents. Since the appellant has not rebutted the findings of the Assessing Officer in the remand report, the observations made by the AO remain unchallenged and are taken into account for this decision. Given these facts, it is evident that the appellant did not discharge the burden of proof required under Section 68 of the Income-tax Act to explain the nature and source of these credits. Therefore, the addition of Rs.1,45,43,306/- made by the Assessing Officer towards unexplained credits is upheld and Ground No. 4 is hereby dismissed.”

5.2. It is manifest from the impugned order of the learned CIT(A) that the assessee failed to submit the explanation as well as documents in support of the source of

8 ITA.No.1567/Hyd./2025 credits in the bank account and consequently, the additions made by the Assessing Officer were confirmed by the learned CIT(A). Now the learned Authorised Representative of the Assessee has explained that assessee was in custody for more than 02 years in India and even when the assessee was out of India he was detained due to look-out notice issued by the investigation agencies and therefore, the assessee was not able to properly prosecute his case before the learned CIT(A). He has also filed copy of the Order of the Hon'ble Supreme Court in the Interlocutory Application filed by the assessee in Civil Appeal Nos.12561 to 12566/2025. From the record filed by the learned Authorised Representative of the Assessee it is clear that there were criminal proceedings pending against the assessee in respect of some financial offence. Accordingly, in the facts and circumstances of the case and in the interest of justice, we allow one more opportunity to the assessee to present its case and file the relevant supporting evidence before the learned CIT(A). Hence, the impugned order of the learned CIT(A) is set aside and the matter is remanded to the record of the learned CIT(A) for granting one more

9 ITA.No.1567/Hyd./2025 opportunity to the assessee to file the necessary supporting evidence as well as to furnish the explanation regarding the source of the credits in the bank account of the assessee. Needless to say, assessee may be given proper opportunity of hearing before passing the fresh order.

6.

In the result, appeal of the Assessee is allowed for statistical purposes.

Order pronounced in the open court on 03.07.2026.

Sd/- Sd/- MANJUNATHA G VIJAY PAL RAO ACCOUNTANT MEMBER VICE PRESIDENT Hyderabad, dated 03rd day of July, 2026. VBP Copy to: PRASAD NIMMAGADDA, C/O KATRAPATI & ASSOCIATES, 1-1-298/2/B/3, 1 SOWBHAGYA AVENUE APTS, 1ST FLOOR, ASHOK NAGAR, STREET NO.1,, HYDERABAD-500020, TELANGANA ACIT., CIRCLE 17(2), SIGNATURE TOWERS, OPP. BOTANICAL GARDEN, KONDAPUR, 2 HYDERABAD - 500 084, TELANGANA 3 THE Pr. CIT, HYDERABAD. 4 THE D.R., ITAT, HYDERABAD B-BENCH, HYDERABAD 5 GUARD FILE TRUE COPY VADREVU Digitally signed by VADREVU PRASADA PRASADA RAO ASSISTANT REGISTRAR / Date: 2026.07.03 I.T.A.T., HYDERABAD RAO 10:45:28 +05'30'

More judgments on Section 68

All 29,931 judgments and leading authorities on Section 68 →

Recent GST High Court judgments

Search GST case law →