MAHABIR PRASAD AGRAWAL,KALAHANDI vs. ACIT CIRCLE-1(1), SAMBALPUR, SAMBALPUR

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ITA 303/CTK/2026Status: DisposedITAT Cuttack26 May 2026AY 2017-184 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal deleted the addition of Rs. 7,40,000 as the transactions with Surendra Kumar Panigrahi were accepted in the preceding year. The enhanced salary addition was reduced from Rs. 1,92,000 to Rs. 96,000, acknowledging the salary was for six months.

What were the facts?

The assessee received Rs. 7,40,000 from Surendra Kumar Panigrahi's bank account, treated as unexplained money. Additionally, the CIT(A) enhanced salary income from Rs. 96,000 to Rs. 1,92,000 without notice. The assessee argued these amounts were for construction supervision and salary, supported by prior year's assessment.

What were the issues?

Whether the addition of Rs. 7,40,000 as unexplained money is justified, and whether the enhancement of salary income by CIT(A) without notice is valid.

Which sections of the Income-tax Act were involved?

Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “HYBRID COURT AT CUTTACK”

Before: SHRI GEORGE MATHAN & SHRI RAJESH KUMAR

For Appellant: Shri S. K. Agarwalla, AR
For Respondent: Shri Vijay Singh, Sr. DR
Hearing: 26.05.2026Pronounced: 26.05.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “HYBRID COURT AT CUTTACK” BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA No.303/CTK/2026 Assessment Year: 2017-18 Mahabir Prasad Agrawal ACIT, Circle-1(1), Sambalpur

Jaipatna, Jaipatna S.O Vs Jayapatna, Kalahandi, Odisha-766018. (PAN: ADAPA6859N) (Appellant) (Respondent)

Assessee by : Shri S. K. Agarwalla, AR Revenue by : Shri Vijay Singh, Sr. DR Date of Hearing : 26.05.2026 Date of Pronouncement : 26.05.2026

ORDER PER BENCH: This is an appeal filed by the assessee against the order of the NFAC, Delhi [hereinafter referred to as the ‘CIT(A)’] in appeal no.NFAC/2016- 17/10121985 dated 23.01.2025.

2.

Shri S. K. Agarwalla, AR appeared on behalf of the assessee and Shri Vijay Singh, Sr. DR represented on behalf of the revenue.

3.

It was submitted by the ld. AR that the additions are in dispute in this appeal, one is an amount of Rs.7,40,000/- received by the assessee from Surendra Kumar Panigrahi’s bank account which was treated as unexplained money of the assessee and the second issue is that the ld.

ITA No.303/CTK/26 CIT(A) has enhanced salary income from Rs.96,000/- to Rs.1,92,000/- without issuing an enhancement notice. It was the submission that the assessee was supervising certain construction work of Surendra Kumar Panigrahi and the assessee used to receive money from Surendra Kumar Panigrahi’s account and the assessee used to dispose off funds in regard to construction work. The assessee has challenged the issues by providing assessment order for the assessment year 2016-17 and the assessment in the case of the assessee has been completed one day before the impugned assessment order and the receipts of Rs.1,21,22,000/- from Surendra Kumar Panigrahi has been accepted. It was the submission that for the impugned assessment year on the ground that Surendra Kumar Panigrahi has not given response to the notice issued u/s 133(6), the Assessing Officer has made the addition. It was the submission that the fact that the assessee is supervising construction on behalf of Mr. Panigrahi has been accepted by the Assessing Officer for the assessment year 2016-17 and the transaction between the assessee and Surendra Kumar Panigrahi has also been accepted for the assessment year 2016-17. This amount of Rs.7,40,000/- was towards finishing work in respect of building. It was the submission that the addition may be deleted. In regard to enhancement of salary by the ld. CIT(A), it was submitted that the salary was received of Rs.96,000/- from Surendra Kumar Panigrahi, the ld. CIT(A) has enhanced Rs.1,92,000/- on the ground that the Assessing Officer observed that the assessee has received Rs.1,92,000/- whereas

ITA No.303/CTK/26 there is no mention in the assessment order. It was the submission that the addition is liable to be deleted.

4.

In reply, the ld. CIT-DR vehemently supported the orders of the Assessing Officer and ld. CIT(A).

5.

We have considered the rival submissions. A perusal of the assessment order for the assessment year 2016-17 which is placed at pages 4 to 16 of the paper-book clearly shows that the assessment order has been passed on 24.03.2022 and the transaction between Surendra Kumar Panigrahi and the assessee has been categorically brought out in the said assessment order for the assessment year 2016-17 and the salary on account of Surendra Kumar Panigrahi has been shown at Rs.1,92,000/-. A perusal of the assessment order for the assessment year 2017-18 clearly shows that the assessee has received under similar circumstances an amount of Rs.7,40,000/- from Surendra Kumar Panigrahi and also received salary for six months from Mr. Panigrahi and the Assessing Officer also recognises that the salary was only for six months. This being so, the addition as made by the Assessing Officer and confirmed by the ld. CIT(A) stands deleted as the transaction between the assessee and Surendra Kumar Panigrahi has also shown and accepted during the assessment year 2016-17. A perusal of the return for the assessment year 2016-17 shows that the salary of Rs.16,000/- per month comes to Rs.1,92,000/- and the same for the impugned assessment year under appeal, the Assessing Officer recognised that the assessee worked

ITA No.303/CTK/26 for six months and consequently the salary can only be assessed for six months. This being so, the addition as enhanced confirmed by the ld. CIT(A) stands reduced from Rs.1,92,000/- to Rs.96,000/-.

6.

In the result, the appeal of the assessee is allowed.

Cuttack, the 26th May, 2026.

Sd/- Sd/- [Rajesh Kumar] [George Mathan] लेखा सदस्य/Accountant Member न्याययक सदस्य/Judicial Member

Dated: 26.05.2026. RS Copy of the order forwarded to: 1. Appellant - 2. Respondent – 3. CIT(A)- 4. CIT- , 5. CIT(DR),

//True copy// By order Assistant Registrar

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