NARESH KUMAR TOMAR,DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, GHAZIABAD

PER ANUBHAV SHARMA, JM:

This appeal is preferred by the assessee against the order dated

28.08.2025 of the Ld. CIT(A)-3, Noida (hereinafter referred as Ld. First

P a g e | 2 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18) Appellate Authority or in short Ld. ‘FAA’) in DIN : ITBA/APL/M/250/2025-

26/1080128484(1) arising out of the order dated 09.12.2019 u/s 153A r.w.s

143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’)

passed by the DCIT, CC, Ghaziabad for AY: 2017-18.

has contested the addition of Rs 61,67,368/- as unexplained expenditure

under section 69C of the Act, 1961 on account of annexure A-1 found during

the course of search and seizure procedure conducted at residential premises

of the appellant. In this case, search u/s 132 was carried out at the premises of

the assessee on 16.06.2017. During the assessment proceedings, the AO

referred to seized documents Annexure A-1, wherein, some payments are

jotted down. The AO reproduced the complete date-wise figures in a tabular

form in the assessment order. The AO calculated the total of the cash

payments at Rs. 61,67,368/-. During the assessment proceedings, the

appellant submitted that the entries in the above-mentioned seized documents

Ertained to Gopi Constech Pvt. Ltd. The AO held that no documentary

evidence relating to the same was provided by the assessee. The AO

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accordingly treated the above transactions as unexplained u/s 69C of the

Income Tax Act, 1961.

submissions filed before the AO. The appellant submitted that the

transactions of Rs. 61,67,368/- as mentioned in Annexure A-1 have been

made through banking channels and reflected in the books of M/s. Gopi

Constech Pvt. Ltd. The appellant submitted that in few entries, the AO has

considered wrong figures wherein, an extra zero has been added during the

course of assessment proceedings. During the course of appellate

proceedings, the submissions of the appellant were forwarded to the AO by

directing as under:

“During the course of appellate proceedings, the AR has stated that the AO during the assessment proceedings was informed that the entries mentioned in the seized documents pertain to M/s Gopi Constech Pvt. ltd. and the said fact was also mentioned by the AO in the assessment order. The AR further stated that despite the above fact, addition of all the entries mentioned in the seized documents has been made in the hands of assessee Further the AR has stated that a number of entries have been wrongly deciphered wherein additional "zero" has been put where none existed. The submissions of the appellant are attached for ready reference. It is directed to send your comments on the above issues in interest of natural justice on or before 10.05.2024 so that the pending appeals could be disposed off.”

02.01.2025 and the same has already been reproduced in the body of order

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above. The AO has stated that the above evidences were not submitted by the

assessee during the assessment proceedings and the same should not be

admitted. Perusal of the assessment order reveals that the AO on page no. 4

of the assessment order has clearly stated that the assessee raised the

contention that the transactions pertained to M/s. Gopi Constech Pvt. Ltd.

The AR during the appellate proceedings has informed that the assessee had

submitted detailed reply on various dates i.e. 07.11.2019 and 25.11.2019. As

per the appellant, the assessee had submitted a detailed sheet in which the

transactions were duly explained. So, the appellant has only reiterated the

submissions filed before the AO and any clarificatory evidence in support of

the submissions filed before the AO cannot be rejected merely by treating the

same as additional evidence.

Shankar Khandasari Sugar Mills v. CIT reported at 59 taxman 405 has

observed as under:

"The appellate authority should have accepted the material produced by the assessee as clarificatory in nature and considered the same to test the fairness and propriety of the estimate of income made by the Income-tax Officer. Though it was belated production of very relevant material, no prejudice (in its legal sense) would have resulted to the Revenue by considering the material produced by the assessee... In the absence of any prejudice to the Revenue, and the basis of the tax under the Act being to levy tax, as far as possible, on the real income, the approach should be liberal in applying the

P a g e | 5 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18)

procedural provisions of the Act. An appeal is but a continuation of the original proceeding and what the Income-tax Officer could have done, the appellate authority also could do." [Emphasis supplied] (p.673)

Prabhavati S. Shah vs. Commissioner of Income-tax reported at [1998] 100

TAXMAN 404 (BOM.) has held as under:

“It is, thus, clear that the powers of the AAC are much wider than the powers of an ordinary court of appeal. The scope of his powers is coterminous with that of the ITO. He can do what the TO can do. He can also direct the ITO to do what he failed to do. The power conferred on the AAC under the said sub-section being quasi-judicial power, it is incumbent on him to exercise the same if the facts and circumstances justify. If the AAC fails to exercise his discretion judicially and arbitrarily refuses to make enquiry in a case where the facts and circumstances so demand, his action would be open for correction by a higher authority. On a conjoint reading of section 250 and rule 46A, it is clear that the restrictions placed on the appellant to produce evidence do not affect the powers of the AAC under sub- section (4) of section 250. The purpose of rule 46A appears to be to ensure that evidence, is primarily led before the ITO. …………………………… The AAC should have considered this evidence in exercise of his powers under subsections (4) and (5) of section 250 which he failed to do. Thus, it was a fit case where the AAC should have exercised the powers conferred upon him and taken on record the zerox copies of the cheque, the certificate from the bank and the copy of the account of the assessee with the said bank and considered the same for deciding the genuineness of the loan.”

under:

P a g e | 6 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18) a. On the contention of the appellant that the total of the transactions

mentioned on the seized documents works out to Rs. 38,99,609/-

instead of Rs. 61,67,368/-, the AO has stated that the seized annexure

A-1 was verified and amount of Rs. 1.50 lacs is mentioned against Bare

Lal (whereas addition made by the AO is Rs. 15 lacs). Similarly, as per

AO, an amount of Rs. 97,100/- is mentioned against Tata Oil (whereas

addition made by the AO is Rs. 9,71,000/-).

b. Further, the AO submitted that the appellant during the remand

proceedings had contended that the payments have been duly accounted

for in the books of M/s. Gopi Constech Pvt. Ltd. The AO has reported

that the above contentions of the appellant were verified from the

ledgers viz a viz the transactions mentioned in the seized documents

and as per AO, the said transactions are duly recorded in the books of

accounts of the company.

appellant vide notice dated 08.08.2025 wherein, the appellant was directed as

under:

P a g e | 7 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18)

“Refer to the page-3 &4 of the assessment order wherein various amounts are mentioned against different names based on the annexure A-1 seized during the search. It is directed to provide the ledger A/c of the all the persons mentioned in seized documents in the Books of accounts of the M/s Gopi Constech Pvt. Ltd. during the year under consideration.

This may be treated as final opportunity.

If you wish to make a physical representation, you may appear personally or through your authorized representative, an opportunity of hearing for which is granted to you on 13.08.2025 at 11:00 AM at the below mentioned address.”

which have been claimed to be part of books of accounts of M/s. Gopi

Constech Pvt. Ltd. The said ledger accounts have been duly examined by this

office. A number of amounts mentioned in the seized document do not match

with the amounts as mentioned in the ledger accounts either because of date

mismatch, mismatch in the amounts, amounts not co-relatable with the

ledgers, handwritten sheets produced as evidence (in absence of ledgers) etc.

All such amounts which could not be co-related to the amounts mentioned in

the ledger accounts of Gopi Constech Pvt. Ltd. as furnished by the appellant

are being separately tabulated below for ready reference:

Date as on seized document Amount (Rs.) Name as per seized document 18.01.2017 1500 Hari Om 21.01.2017 5000 Mullin Setting 22.01.2017 16060 Bulk 08.02.2017 100000 Sudethji 08.02.2017 50000 Gajraji 16.02.2017 95000 SE 16.02.107 150000 S

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16.02l.2017 95000 Shift 18.02.2017 1000 Abrar Ali 21.02.2017 35000 EERav 21.02.2017 150000 Rakesh 21.02.2017 15000 Aanyjan 24.02.2017 9000 Manish Jh - 9708 Poplane Ole - 500000 Parag 11.03.2017 100000 Yadav 10.03.2017 141000 Connection 12.03.2017 39000 Bade Lal 16 March 10000 Bade Lal 16 March 341400 Steel 17 March 328000 Niresh JE 5900 Aanajana UCO 3500 Rahana Khana 500 Taxi 8000 Self 114400 Officer Total 2503968

25,03,968/- are not verifiable from the ledger accounts of Gopi Constech Pvt.

Ltd. due to various mismatches as already discussed above. As per Section

292C, there is a basic presumption that the contents of the seized documents

are true and they pertain to the assessee. The entries which could be related to

M/s. Gopi Constech Pvt. Ltd. have been excluded from the calculation while

drawing the above table. The entries which are not related to Gopi Constech

Pvt. Ltd. have to be explained by the assessee from whose possession the said

document has been seized. The document also is worthwhile for the reason

that many of the entries can be connected to the company M/s. Gopi

Constech Pvt. Ltd. in which the assessee is a director. The entries which

P a g e | 9 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18)

could not be corelated to Gopi Constech Pvt. Ltd. have to be personally

explained by the assessee being director of the said company. Accordingly,

the addition made by the AO is sustained to the extent of Rs. 25,03,968/- and

the appellant gets relief to the balance amount.

“1. On the facts and circumstances of the case Learned CIT (A) has erred both in facts and in law upholding the impugned order passed by the respondent, illegally violating the principles of natural justice, without fair and objective application of mind to the facts of the case and the law applicable and without being guided by the binding decisions of the courts and tribunals and hence liable to be set aside and quashed and declared non est in law. 2. On the facts and circumstances of the case, the learned CIT(A) - 3 Noida has erred both in facts and in law in sustaining the action of AO initiation of proceedings under section 153A of the Income Tax Act, 1961. 3. On the facts and circumstances of the case, the Learned C(A) -3, Noida has erred, both in facts and in law, sustaining the assessment of the appellant to the tune of Rs.25,03,968/- out of total addition of Rs.61,67,368/-despite the fact that appellant had submitted complete detailed with regard to same which is liable to be deleted. 4. That the provisions of section 234A, 234B and 234C of the Act are not at all applicable. 5. That the impugned order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence.”

assessee and the additional evidences and ld. CIT(A) too has accepted the

same, however, on the basis of same set of evidence and remand report ld.

P a g e | 10 ITA No.6225/Del/2025 Naresh Kumar Tomer (AY:2017-18) CIT(A) has found some of the entries to be uncorroborated without referring

to direct evidence. We fail to understand as to how same set of evidence as

submissions of assessing officer in the remand report could have been basis

to give assessee’s relief and also deny the same to some extent. Therefore, we

find substance in the ground as raised the appeal of assessee is allowed the

impugned addition is deleted.

Order pronounced in the open court on 29.04.2026

Sd/- Sd/- (Manish Agarwal) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 29.04.2026 Rohit, Sr. PS