NARESH KUMAR KHARAKIA,BAGUIHATI vs. ITO, WARD 36(1),, KOLKATA

ITA 129/KOL/2026Status: DisposedITAT Kolkata29 September 2026AY 2023-20245 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal considered the rival contentions and the facts of the case. The assessee requested that the case be set aside before the Assessing Officer (AO) to provide a proper opportunity of being heard and to file the required documents. The Tribunal, in the interest of justice and fair play, found it appropriate to allow the assessee's request. Consequently, the Tribunal set aside the order of the CIT(A) and remitted the matter back to the AO for reassessment de novo. The assessee was directed to be given a reasonable opportunity to be heard and to make further submissions, with a caution against seeking unnecessary adjournments. The grounds of appeal were partly allowed for statistical purposes.

What were the facts?

The assessee, Naresh Kumar Kharakia, filed an appeal against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi, for Assessment Year 2023-24. The Assessing Officer (AO) selected the case for scrutiny due to high liabilities compared to low income and receipts, and low income from scrap sales. The AO rejected the assessee's books of account under section 145(3) and estimated business income under section 144, making an addition of ₹14,54,02,234/-. Additionally, the AO treated capital introduced during the year amounting to ₹1,87,41,534/- as unexplained cash credit under section 68 read with section 115BBE. The CIT(A) upheld the AO's order, dismissing the assessee's appeal. The assessee then appealed to the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the Assessing Officer was justified in passing the assessment order under section 143(3) read with section 144B of the Income Tax Act, 1961 (mixed question of law and fact). 2. Whether the Assessing Officer complied with Circulars and Instructions issued by the CBDT (question of law). 3. Whether the Assessing Officer was justified in making an addition of ₹14,54,02,234/- to the total income on account of estimated business income (mixed question of law and fact). 4. Whether the Assessing Officer was justified in making an addition of ₹1,87,41,534/- on account of capital introduced during the year as unexplained cash credit (mixed question of law and fact). Assessee's Contention: The assessee argued that the required documents were not filed before the lower authorities and requested another opportunity to present sufficient documentary evidence. The appeal before the CIT(A) was dismissed concerning both the estimated business profit and the unexplained capital introduction. Revenue's Contention: The Department relied on the order of the CIT(A) and requested it be upheld.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 145(3),Section 144,Section 68,Section 115BBE,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH AT KOLKATA

Before: SHRI GEORGE MATHAN & SHRI RAKESH MISHRA

For Respondent: Md. Gayasuddin Ansari, CIT, DR

PER RAKESH MISHRA, ACCOUNTANT MEMBER:

This appeal filed by the assessee is against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi [Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 [the 'Act'] for AY 2023-24 dated 31.12.2025. ITA No(s). 129/KOL/2026 A

The order continues below.

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