CHANDAN NEWAR,DEOGHAR vs. DCIT, CIRCLE 3(1), IT, KOLKATA,, KOLKATA

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ITA 1638/KOL/2026Status: DisposedITAT Kolkata25 August 2026AY 2014-20154 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that if the reasons recorded for reopening a case do not ultimately lead to an addition, the Assessing Officer lacks jurisdiction to frame an assessment on other issues. Therefore, the additions made were set aside.

What were the facts?

The assessee's case was reopened based on information about an outstanding balance on the National Spot Exchange Limited. The Assessing Officer made additions under Section 69A and for speculative business, not on the original grounds for reopening.

What were the issues?

Whether the Assessing Officer has jurisdiction to make additions on grounds other than those recorded for reopening the assessment.

Which sections of the Income-tax Act were involved?

Section 147,Section 69A,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH,

Before: SHRI YOGESH KUMAR U.S. & SHRI GOPALAN GURUSAMY

For Appellant: Shri Subash Agarwal, AR
For Respondent: Shri Debashish Biswa, JCIT
Hearing: 19.08.2026Pronounced: 25.08.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA BEFORE SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI GOPALAN GURUSAMY, ACCOUNTANT MEMBER ITA No.1638/KOL/2026 Assessment Year: 2014-15

Chandan Newar Vs. DCIT, Circle-3(1), IT C/o Subash Agarwal & Kolkata Associates, Advocates, Siddha Gibson, 1, Gibson Lane, Suite 213, 2nd Floor, Kolkata-7000069 [PAN: AFWPN8582M] APPELLANT RESPONDENT Appellant by : Shri Subash Agarwal, AR Respondent by : Shri Debashish Biswa, JCIT Date of hearing : 19.08.2026 Date of Pronouncement : 25.08.2026 O R D E R PER YOGESH KUMAR U.S., JUDICIAL MEMBER: This Appeal is filed by the Assessee against the order of the Commissioner of Income Tax (Appeal) (‘Ld. CIT(A)’ for short) dated 18.02.2026, passed u/s 250 of the Income Tax Act, 1961 (“the Act”, for short) for the Assessment Year 2014-15.

2.

Brief facts of the case are that, the case of the Assessee was reopened u/s 147 of the Act, based on the information that Assessee had outstanding balance on National Spot Exchange Limited of Rs.11,69,340/- as on termination of activity on 31.07.2013. Assessment proceedings has been initiated and an Assessment Order

ITA No.1638/Kol/2026 Chandan Newar; A.Y: 2014-15 u/s 147 of the Act came to be framed on 24.03.2022 by making an addition of Rs.6,01,500/- u/s 69A of the Act and also made an addition of Rs.56,213/- on account of speculative business. Aggrieved by the Assessment Order dated 24.03.2022, Assessee preferred an Appeal before the Ld. CIT(A). The Ld. CIT(A) vide Order dated 18.02.2026, dismissed the Appeal of the Assessee. As against the order of the Ld. CIT(A) dated 18.02.2026, Assessee preferred the captioned Appeal. The Assessee has raised several Grounds and Assessee has not pressed Ground No.2 of the Appeal. Accordingly, Ground No.2 of the Appeal regarding issue of ‘limitation’ is hereby dismissed as not pressed.

3.

The Learned Counsel for the Assessee canvassing on Ground No. 1 of Appeal, submitted that the reasons recorded by the Assessing Officer has not ultimately resulted in framing the assessment and Assessing Officer framed assessment on other counts, which are not part of the reason recorded, therefore, relying on the various judicial precedents, sought for setting aside the Assessment Order.

4.

Per contra, the Ld. DR relying on the orders of the Lower Authorities sought for dismissal of the Appeal.

5.

We have heard the parties and perused the material available on record. As could be seen from the reasons recorded, the case of the

ITA No.1638/Kol/2026 Chandan Newar; A.Y: 2014-15 Assessee was selected on the ground that ‘there is an undisclosed income amounting to Rs.11,69,304/-.’ Even in the Assessment Order, the Assessing Officer has mentioned that based on the information that the Assessee had outstanding balance on National Spot Exchange Limited of Rs.11,69,304/- as on termination of activities, the case of the Assessee was reopened. However, no addition has been made on the said count and the other two additions have been made of Rs.6,01,500/- u/s 69A of the Act and Rs.56,213/- on account of speculative business. It is well-settled law that, once the reasons recorded has not ultimately resulted in addition, the Assessing Officer has no jurisdiction to frame assessment on other issues. Thus, we find merit in Ground No.1 of the Assessee. In view of the same, addition made by the Assessing Officer which has been confirmed by the Ld. CIT(A) is set aside.

6.

In the result, Appeal of the Assessee is allowed.

Order pronounced on 25.08.2026.

Sd/- Sd/- (GOPALAN GURUSAMY) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 25.08.2026 DP, PS

ITA No.1638/Kol/2026 Chandan Newar; A.Y: 2014-15 Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR) //TRUE COPY//

DEPUTY REGISTRAR KOLKATA BENCHES, KOLKATA

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