SURESH PRABHULAL KABRA,AHMEDABAD vs. THE ITO, WARD-1(1)(3), AHMEDABAD

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ITA 2078/AHD/2025Status: DisposedITAT Ahmedabad21 May 2026AY 2018-195 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the issue was covered by its own decision in the assessee's preceding assessment years. It was established that the transactions belonged to the assessee's HUF, not the individual assessee, and thus the addition was deleted.

What were the facts?

The assessee's appeal concerns an addition of Rs. 20,71,97,176/- made in assessment year 2018-19. The addition was based on information regarding accommodation entries allegedly taken by the assessee. The assessee contended that the transactions pertained to his HUF and not to him individually.

What were the issues?

Whether the addition made in the individual's name was correctly attributed, considering it pertained to the HUF's transactions due to a bank's PAN linkage error. Whether the assessment reopening and subsequent additions/penalties were valid.

Which sections of the Income-tax Act were involved?

Section 143(2),Section 115BBE,Section 271AAC,Section 234B,Section 234D

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: SMT. ANNAPURNA GUPTA & Ms. SUCHITRA KAMBLE

For Appellant: Shri Parin Shah, AR, Shri Abhijit, SR.DR
For Respondent: Shri Abhijit, SR.DR
Hearing: 18/03/2026Pronounced: 21/05/2026

PER ANNAPURNA GUPTA, AM:

The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi (hereinafter referred to as “CIT(A)”) dated 14.08.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2018-19.

ITA No.2078/Ahd/2025 [Suresh Prabhulal Kabra vs. ITO] A.Y. 2018-19 - 2 –

2.

The grounds of appeal raised by the assessee read as under:

“1. The order passed by lower authorities in bad in law and required quashed. 2. The reopening of assessment is without any tangible material, and it is merely for verification purpose without any corroborating evidence and accordingly, the same is required to be quashed. 3. The reopening of assessment is based on borrowed satisfaction which is not permissible in law. 4. Ld. NFAC erred in law and on facts in not adjudicating legal ground with respect to issuance of notice u/s 143(2) of the Act beyond a statutory time limit and accordingly, assessment proceedings is required to be quashed. 5. Ld. NFAC erred in law and R facts in confirming on action of AO in making addition of Rs. 20,71,97,176/- as money unexplained ignoring submission that said transactions pertains to HUF but by error on the part of bank official, PAN of Individual was linked to bank account of HUF. 6. Ld. NFAC ought to have considered the fact that all transactions are duly recorded in books of HUF and accordingly, adding same again in individual case results into double addition. 7. Both the lower authorities erred in law and on facts in making addition without confronting material relied on or without providing statements of various persons and thus, violated principle of natural justice and accordingly order passed is required to be quashed. 8. Ld. NFAC erred in law and on facts in confirming action of AO in taxing addition at special rate as prescribed u/s 115BBE of the Act. 9. Initiation of penalty N proceedings u/s 271AAC is unjustified. 10. Charging of interest u/s.234B and 234D is unjustified.”

ITA No.2078/Ahd/2025 [Suresh Prabhulal Kabra vs. ITO] A.Y. 2018-19 - 3 –

3.

At the outset itself, Ld. Counsel for the assessee pointed out that the issue involved in the present appeal is covered in favour of the assessee by the decision of the ITAT in the case of assessee itself in the preceding assessment years 2014-15 to 2017-18 in ITA Nos. 830 to 833/Ahd/2023, order dated 03.09.2025. Ld. Counsel for the assessee pointed out that the facts and issue involved in the present case were identical to that of the preceding years wherein the allegation of the Revenue was that the assessee was beneficiary of accommodation entry taken from an accommodation entry provider Shri Sanjay Tibrewal. He pointed out that the information in the possession of the Department was that M/s. Kabra & Co. had availed the said accommodation entry. He pointed out that in the preceding years it had been pointed out to the Revenue Authorities and even to the ITAT, that M/s. Kabra & Co. was the concern of the assessee’s HUF and was not his own proprietorship concern, but, the Revenue authorities had rejected this contention of the assessee noting that the bank account of the M/s. Kabra & Co. in Kotak Mahindra Bank, where the alleged accommodation entry was taken by the assessee, carried PAN of the assessee in his individual capacity and not the PAN of the assessee HUF. He pointed out, however, that the ITAT appreciated the contention of the assessee and, accordingly, deleted the addition made in the hands of the assessee in his individual capacity. He drew our attention to the findings of the ITAT paragraph nos. 8 & 9 of the Order as under:

ITA No.2078/Ahd/2025 [Suresh Prabhulal Kabra vs. ITO] A.Y. 2018-19 - 4 –

“8. In the light of the above, it stands, as a matter of fact, on record that M/s. Kabra & Co. is the proprietorship concern of the assessee’s HUF and not proprietorship concern of the assessee in his individual capacity. This fact has been acknowledged by the AO in the assessment order passed in the case of the assessee for A.Y. 2019-20 after making due verification from the bank itself on issuing notice u/s.133(6) of the Act. We have also noted that the assessee in the said case in A.Y. 2019-20 had submitted a letter from the Bank acknowledging its mistake of having linked the PAN no. of the assessee in his individual capacity to the bank account of the M/s. Kabra & Co., when actually it was the proprietorship concern of the assessee’s HUF and the PAN no. of the assessee HUF ought to have been assigned to the said bank account. The Department in the present case has failed to controvert the aforesaid fact before us despite ample opportunity given during the course of hearing before us. In the light of the same, we are inclined to agree with the Ld. Counsel for the assessee that the addition made in the hands of the assessee in all the four years do not pertain to the assessee but to the assessee’s HUF, which was the proprietorship concern of M/s. Kabra & Co. and in whose bank account i.e. in the bank account of the Kabra & Co. the alleged accommodation entry had been received as per the information available with the Department.

9.

In view of the above, the addition made in the hands of the assessee in all four years, i.e A.Y 2014-15 to A.Y 2017-18, amounting to Rs.17,16,95,541/-, Rs.18,86,73,700/-, Rs.24,65,97,112/- & Rs.15,29,66,545/-; respectively, is directed to be deleted.”

4.

Ld. DR before us was unable to controvert the contention of the Ld. Counsel for the assessee before us as above. He was unable to point out any distinguishing facts from the preceding years in A.Y. 2014-15 to A.Y. 2017-18 in the case of the assessee.

5.

In the light of the above, it is sufficiently established before us that the issue involved in the present case is squarely covered by the decision of the ITAT in the case of the assessee itself in the preceding years and we, therefore, have no hesitation in applying the decision of the ITAT in the preceding years to the facts of the present case and directing the deletion of the addition

ITA No.2078/Ahd/2025 [Suresh Prabhulal Kabra vs. ITO] A.Y. 2018-19 - 5 –

made on account of alleged accommodation entry taken by the assessee amounting to Rs.20,71,97,176/-. The ground raised by the assessee are, therefore, allowed.

6.

In the result, the appeal filed by the asessee is allowed.

This Order pronounced on 21/05/2026

Sd/- Sd/- (SUCHITRA KAMBLE) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 21/05/2026 S. K. SINHA True Copy आदेश क� �ितिल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. 2. ��यथ� / The Respondent. संबंिधत आयकर आयु� / Concerned CIT 3. 4. आयकर आयु�(अपील) / The CIT(A)- �वभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. गाड� फाईल / Guard file. 6. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

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