A D REALBUILD PRIAVATE LIMITED,DELHI vs. DCIT, CC-15, DELHI

ITA 2543/DEL/2026Status: DisposedITAT Delhi30 September 20267 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that a protective addition cannot be sustained in the absence of a corresponding substantive addition in the hands of any other person. The Tribunal found that the solitary issue was squarely covered in favor of the assessee by the decision of the ITAT, Gauhati bench in *Income Tax Officer vs Keshava Nanda Kakati*. This decision, along with other cited precedents such as *ITO vs. Fussy Financial Services Private Limited*, *M.P. Ramachandran vs. DCIT*, *Gregory & Nicholas vs. ACIT*, and *G.K. Consultants Ltd. vs. ITO*, established the principle that a substantive assessment must precede a protective assessment. Since the assessment order of Shri Pankaj Goel did not reflect any substantive addition of Rs. 6,00,00,000, the protective addition made in the hands of the assessee was deemed legally unsustainable. Consequently, the Tribunal deleted the protective addition. The appeal filed by the assessee was allowed.

What were the facts?

The assessee, AD Realbuild Private Limited, filed an appeal against the order of the Commissioner of Income-tax (Appeals) - Delhi-26, dated 09.02.2026, for Assessment Year 2020-21. The core issue was a protective addition of Rs. 6,00,00,000 made by the Assessing Officer (AO) under Section 69A of the Income-tax Act, 1961. The assessee contended that this protective addition was unsustainable as no corresponding substantive addition had been made in the hands of any other person. The AO's assessment order in the case of Shri Pankaj Goel was cited, which showed a receipt of Rs. 6 crores by the assessee from Radhey Shyam, reflected in the assessee's bank account. However, the assessment order for Shri Pankaj Goel indicated that the additions made in his hands, totaling Rs. 9 crores, did not include any substantive addition related to the Rs. 6 crores in question.

What were the issues?

1. Whether a protective addition under Section 69A of the Income-tax Act, 1961, can be sustained in the absence of a corresponding substantive addition in the hands of any other person? (Question of law) Assessee's Contention: The assessee argued that a protective addition is legally unsustainable if no substantive addition is made in the hands of any person. They relied on the assessment order of Shri Pankaj Goel, which showed no substantive addition of Rs. 6,00,00,000, despite the protective addition made in the assessee's hands. The assessee cited the decision in *Income Tax Officer vs Keshava Nanda Kakati* (ITAT, Gauhati bench) in support of their argument. Revenue's Contention: The Revenue relied on the findings of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
1 IN THE INCOME TAXAPPELLATE TRIBUNAL DELHI BENCH “C”, NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER and SHRI RAJ KUMAR CHAUHAN, JUDICIAL MEMBER AD Realbuild Private Limited, vs. DCIT, Central Circle 15, 21/6, Ground Floor, Delhi. West Patel Nagar, New Delhi - 110 008. (PAN: AALCA2778H) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Mayank Patwari, Advocate Shri Akash Ojha, Advocate REVENUE BY : Shri Saurav Narayan Modi, CIT DR Date of Hearing : 15.07.2026

Date of Order : 30.09.2026 O R D E R PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER :

1.

This appeal is filed by the assessee against the order of ld. Commissioner of Income-tax (Appeals), Delhi-26 [“Ld. CIT(A)”, for short] dated 09.02.2026 for the AY2020-21. 2. At the time of hearing, ld. AR of the assessee brought to our notice the relevant facts of the case and his submissions as under. He submitted that the sole issue involved in the present appeal is that the ld. CIT(A) has affirmed the findings of 2 the Assessing Officer, who made a protective addition of Rs 6,00,00,000/- under Section 69A of the Income-tax Act, 1961 (for short ‘the Act’), to the returned income of the assessee. However, no corresponding substantive add

The order continues below.

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