PRADEEP KUMAR AGRAWAL,MEERUT vs. AO NFAC, MEERUT

ITA 8224/DEL/2026Status: DisposedITAT Delhi29 September 2026AY 2013-145 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the appeal to the file of the Assessing Officer (AO) for a fresh examination of the source of cash deposits. The Tribunal noted that in the first round, additional evidence was admitted and the matter was restored to the AO for de novo examination. However, in the second round, the AO reiterated the old addition, and the CIT(A) upheld it, without considering the admitted additional evidence. The assessee had submitted that cash deposits were from withdrawals made from partnership firms, M/s DP Enterprises and M/s D.P. Enterprises, where he was a partner and received remuneration, interest, and profit. The Tribunal found that these documents, including current account, capital account, and cash flow statements, required factual verification by the AO. Therefore, in the interest of justice and fair play, the appeal was restored to the AO to examine the source of cash deposits in light of the additional evidence submitted in the first round. The assessee was also permitted to furnish fresh evidence. The grounds raised by the assessee were allowed for statistical purposes.

What were the facts?

The assessee, Pradeep Kumar Agrawal, filed an appeal before the ITAT challenging the order of the National Faceless Appeal Centre (NFAC), Delhi, which confirmed an addition of Rs. 28,23,948/-. This addition was made by the Assessing Officer (AO) under Section 143(3) of the Income-tax Act, 1961, for Assessment Year 2013-14. The original assessment order dated 21.09.2021 had made additions including Rs. 50,000/- for unexplained expenditure and Rs. 5,50,636/- on account of commodity exchange transactions. The CIT(A) deleted the Rs. 50,000/- and Rs. 5,50,636/- additions but confirmed the Rs. 28,23,948/- addition. The assessee had previously appealed to the ITAT, which admitted additional evidence and restored the matter to the AO for fresh adjudication. In the second round, the AO reiterated the addition, and the CIT(A) upheld it. The assessee contended that the cash deposits were explained by withdrawals from partnership firms.

What were the issues?

1. Whether the learned CIT(A) erred in confirming the addition of Rs. 28,23,948/- made under Section 143(3) read with Section 254 and Section 144B of the Income-tax Act, 1961, by the Assessing Officer. 2. Whether the learned CIT(A) failed to appreciate that the Assessing Officer did not properly comply with the specific directions issued by the Hon'ble ITAT while setting aside the matter for fresh adjudication and verification of additional evidence. 3. Whether the learned CIT(A) erred in sustaining the addition of Rs. 28,23,948/- by invoking the provisions of Section 68, when the amount represented cash deposits and not unexplained cash credits in the assessee's books. 4. Whether the learned CIT(A) failed to appreciate that complete details of the source of cash deposits, including ledger accounts of partnership firms, were furnished, sufficiently explaining the source. Assessee's Contentions: The assessee argued that the addition of Rs. 28,23,948/- was wrongly confirmed as it represented cash deposits, not unexplained cash credits, making Section 68 inapplicable. Complete details of the source of deposits, including partnership firm accounts, were provided. The CIT(A) erred in not pointing out defects in the provided evidence. The assessee was carrying on a regular business, assessed to tax, and maintained regular books of account. The addition was arbitrary as the AO neither rejected the books nor established undisclosed income. The CIT(A) rejected explanations regarding withdrawals from M/s D.P. Enterprises and M/s Pradeep Mittal & Company without independent inquiry. Revenue's Contentions: The judgment records no specific contentions for the revenue.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 254,Section 144B,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: SHRI M. BALAGANESH

The appeal in ITA No.8224/Del/2026 for AY 2013-14, arises out of the 1. order of the ld National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 24.06.2026 against the order of assessment passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 21.09.2021 by the Assessing Officer, National Faceless Assessment Centre, Delhi (hereinafter referred to as ‘ld. AO’).

The assessee has raised the following grounds of appeal:- 2. “1. That t

The order continues below.

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