JAGRITI INVESTMENT PVT. LTD.,KOLKATA vs. I.T.O., WARD - 3(1), KOLKATA

ITA 728/KOL/2026Status: DisposedITAT Kolkata28 September 2026AY 2016-20174 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the provisions of Section 69 of the Income-tax Act, 1961, are applicable when an assessee has made investments not recorded in their books of account, or when the explanation offered about the nature and source of investments is unsatisfactory. In this case, the assessee had duly recorded the transactions in its books of account as the purchase of new unlisted equity shares from M/s Polygon Tradecom and M/s Prajapati Commosale Pvt. Ltd. The AO's addition was based solely on the investigation wing's report without disproving the assessee's explanation or the recording of the transactions in the books. Therefore, the Tribunal found the order of the AO and the CIT(A) to be incorrect. The Tribunal set aside the appellate order and directed the AO to delete the addition made under Section 69.

What were the facts?

The assessee, Jagriti Investment Pvt. Ltd., is in appeal against the order of the National Faceless Appeal Centre, Delhi, dated 06.02.2026, for Assessment Year 2016-17. The Assessing Officer (AO) had reopened the case based on information from the insight portal regarding high-risk cases, stemming from a search conducted on 08.03.2022. The information indicated the assessee received ₹70,00,000 from M/s Polygon Tradecom and ₹74,00,000 from Prajapati Commosale Pvt. Ltd. on 21.04.2015, allegedly for accommodation entries. A notice under Section 148 was issued on 28.04.2023. The assessee filed a return declaring ₹10,310. The AO treated the total amount of ₹1,44,00,000 as unexplained investment under Section 69 of the Income-tax Act, 1961, relying on the investigation wing's report. The CIT(A) confirmed this addition.

What were the issues?

1. Whether the addition of ₹1,44,00,000 as unexplained investment under Section 69 of the Income-tax Act, 1961, is justified, considering the assessee's explanation that the amounts were paid for the purchase of unquoted shares. Assessee's Contention: The assessee argued that the amounts received were for the purchase of unquoted shares from the two entities. The transactions were duly recorded in the assessee's books of account. Revenue's Contention: The revenue, through the AO, relied on the investigation wing's report which suggested that M/s Polygon Tradecom and Prajapati Commosale Pvt. Ltd. were engaged in providing accommodation entries. The AO treated the entire sum as unexplained investment under Section 69.

Which sections of the Income-tax Act were involved?

Section 69,Section 132,Section 148,Section 143(2),Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, KOLKATA

For Appellant: Shri J. Jhajharia, AR
For Respondent: Shri Ambrish Mishra, DR
Hearing: 17.08.2026Pronounced: 28.09.2026

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 06.02.2026 for the AY 2016-17. 2. The only issue raised by the assessee is against the order of ld. CIT (A) confirming the addition of ₹1,44,00,000/- as made by the ld. AO u/s 69 of the Income-tax Act, 1961 (the Act).

3.

The facts in brief are that the case of the assessee was reopened on the basis of information disseminated in respect Jagriti Investment Pvt. ltd.; A.Y. 2016-17 of assessee in the insight portal under category of high risk CRIU/VRU cases. The information was gathered during the

The order continues below.

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