ASSISTANT COMMISSIONER OF INCOME TAX, MUZAFFARNAGAR vs. AJAY KUMAR, MUZAFFARNAGAR

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ITA 4583/DEL/2025Status: DisposedITAT Delhi15 May 2026AY 2014-154 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the CIT(A) was justified in deleting the addition related to net profit estimation and the addition made under section 68. The Assessing Officer was found to have exceeded his jurisdiction in making these additions.

What were the facts?

The revenue appealed against the CIT(A)'s order for AY 2014-15, which arose from an assessment order passed under section 143(3) r.w.s. 263. The assessee did not appear for the hearing.

What were the issues?

Whether the Assessing Officer exceeded his jurisdiction by making additions not covered by the directions under section 263, and whether the CIT(A) was justified in deleting these additions.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 263,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH, ‘B’: NEW DELHI

Before: SHRI C.N. PRASAD & SHRI SANJAY AWASTHI

Hearing: 11.03.2026Pronounced: 15.05.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘B’: NEW DELHI BEFORE SHRI C.N. PRASAD, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER

ITA No.4583/Del/2025 [Assessment Year: 2014-15] ACIT Vs. Ajay Kumar Muzaffarnagar H. No.-78, Prem Vihar, Jansath Road, Muzaffarnagar PAN No.ATOPK2495C Appellant Respondent Appellant by Sh. Rajesh Kumar Dhanesta, Sr. DR Respondent by None Date of Hearing 11.03.2026 Date of Pronouncement 15.05.2026 ORDER PER C.N. PRASAD, J.M. This appeal is filed by the revenue against the order of Ld. CIT(A)/NFAC, Delhi dated 28.05.2025 for the A.Y. 2014- 15, arising out of the assessment order passed u/s.143(3) r.w.s. 263 of the Act.

2.

Inspite of issue of notice none appeared on behalf of the assessee nor any adjournment application was moved, therefore, this appeal is disposed off on hearing the Ld. DR.

3.

The revenue has raised following grounds of appeal :-

1.

On facts and circumstances of the case and in law, whether the CIT (A) is justified in applying a net profit of 3% on the turnover, without appreciating the facts and circumstances of the case and in the absence of reliable books of accounts, as against 8% applied by the Assessing Officer?

2.

On facts and circumstances of the case and in law, whether the CIT (A) is justified in deleting the addition of Rs. 17,78,600/out of addition of Rs.49,00,000/- made u/s 6B of the IT. Act, 1961, despite the assessee's failure to fully discharge the burden of proving the identity, creditworthiness and genuineness of the transaction as required under law?

4.

In so far as the ground No.1 is concerned which is in respect of estimation of net profit @ 8% on the turnover by the AO and deletion of such estimation of net profit by the Ld. CIT(A), we find that the Ld. CIT(A) deleted this addition for the reason that the Ld. PCIT had originally set aside the assessment u/s.263 of the Act and directed to only examine the genuineness of agricultural income credited to the capital account. The estimation of net profit on the turnover was subject matter before the ld. CIT(A) against original assessment order wherein Ld. CIT(A) reduced the net profit to 3% and therefore, the Ld. CIT(A) was of the view that the AO exceeded the jurisdiction by once again estimating the net profit @8% though the Ld. CIT(A) granted relief to the assessee. We see no infirmity in the order passed by the Ld. CIT(A) in deleting the addition. This ground of appeal of the revenue is dismissed.

5.

Similarly coming to the addition made u/s.68 of the Act, we observed that the Ld. CIT(A) deleted this addition for the reason that the AO exceeded his jurisdiction while passing the order pursuant to the direction u/s.263 of the Act by the Ld.PCIT for the reason that this addition was not subject matter of direction in the order passed u/s.263 of the Act by the ld. PCIT. Further we observed that the addition made u/s.68 of the Act of Rs.49 lacs was reduced by the Ld. CIT(A) to Rs.31,24,400/- in the appeal filed by the assessee against the original assessment order. Therefore, Ld. CIT(A) was of the view that since the AO while giving effect to the order of the Ld. PCIT u/s.143(3) r.w.s. 263 of the Act once again made this addition by exceeding his jurisdiction. We see no infirmity in the order passed by the Ld. CIT(A) in deleting this addition. This ground of appeal of revenue is dismissed.

6.

In the result, the appeal of the revenue is dismissed.

Order pronounced in the open court on 15.05.2026.

Sd/- Sd/- [SANJAY AWASTHI] [C.N. PRASAD] ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 15.05.2026

NEHA , Sr.P.S.* Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi

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