ACIT, NEW DELHI vs. VIKAS DAHIYA , NEW DELHI

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ITITA 34/DEL/2026Status: DisposedITAT Delhi05 August 2026AY 2020-215 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the Assessing Officer (AO) made the addition solely based on information from the Insight Portal without conducting independent verification, such as obtaining bank statements. Before the Ld. CIT(A), the assessee provided bank statements showing maturity of existing FDRs and renewal of new FDRs from these matured funds. Furthermore, the assessee submitted assessment orders for Assessment Years 2018-19 and 2019-20, where similar additions were deleted after verifying that funds were received from UAE bank accounts. The Tribunal observed that the Revenue failed to controvert the Ld. CIT(A)'s findings or present contrary material to show that the term deposits were made during the year under appeal from fresh funds, rather than rollovers. Therefore, the Tribunal found no error in the Ld. CIT(A)'s deletion of the addition, as no addition could be made under Section 69 when no fresh funds were invested. All grounds of appeal raised by the Revenue were dismissed.

What were the facts?

The Revenue is in appeal against the order of the Ld. CIT(A) for Assessment Year 2020-21. The assessee, a non-resident individual, had not filed a return of income. Reassessment proceedings were initiated based on information from the Insight portal indicating term deposits of INR 2.35 crores. The assessee filed a return declaring NIL income and claimed a refund. The Assessing Officer (AO) made an addition of INR 2.35 crores under Section 69 as unexplained investment. The Ld. CIT(A) allowed the assessee's appeal, noting that the term deposits were renewals of those made in preceding assessment years and deleted the addition after verifying bank statements. The Revenue is aggrieved by this deletion.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Ld. CIT(A) was justified in deleting the addition of INR 2,35,25,000/- made under Section 69 of the Income Tax Act, 1961, without the assessee conclusively proving the source of investment. 2. Whether the Ld. CIT(A) erred in law in accepting bank statements as sufficient evidence of source, without establishing creditworthiness and genuineness of the alleged foreign income to have funded the investment. 3. Whether the Ld. CIT(A) erred in law by holding that mere reinvestment of term deposits absolves the assessee from explaining the original source of funds under Section 69. 4. Whether reliance on acceptance of similar investments in earlier assessment years is legally sustainable, when each assessment year is a separate and independent unit of assessment. 5. Whether the Ld. CIT(A) erred in law and on facts in deleting the addition by relying upon evidences filed during appeal proceedings without calling for a Remand Report from the AO, thereby denying the AO an opportunity to verify and rebut such evidences. Assessee's Contention: The Ld. CIT(A) correctly allowed the appeal by accepting that the term deposits were renewals of investments made in preceding assessment years, as evidenced by bank statements. The original funds were received from UAE in earlier years and invested in FDRs, which were deleted in appellate proceedings for those years. The AO made the addition solely based on the Insight portal without independent inquiry. Revenue's Contention: The Ld. CIT(A) was not justified in deleting the addition without the assessee conclusively proving the source of investment. Bank statements alone are insufficient without establishing creditworthiness and genuineness of foreign income. Reinvestment does not absolve the assessee from explaining the original source. Reliance on earlier assessment years is not sustainable. The Ld. CIT(A) erred by relying on evidence without a remand report from the AO.

Which sections of the Income-tax Act were involved?

Section 69,Section 147,Section 144C(3),Section 250,Section 148,Section 144C(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI “D” BENCH: NEW DELHI

Before: SHRI VIKAS AWASTHY & SHRI MANISH AGARWAL

For Appellant: Shri Vikas Dahiya
For Respondent: Shri Vikram Singh, Sr. Dr, Shri Vikas Dahiya
Hearing: 19.05.2026Pronounced: 05.08.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “D” BENCH: NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER IT(IT)A No.34/Del/2026 [Assessment Year : 2020-21] ACIT vs Vikas Dahiya Dr.S.P.M. Civic Centre, 59, Second Floor, Minto Road, SKD Basti, Kailash Hills, Press Enclave, Ajmeri Gate, New Delhi-110065. New Delhi-110002 PAN-ADSPD4549A APPELLANT RESPONDENT Revenue by Shri Vikram Singh, Sr. Dr Assessee by Shri Vikas Dahiya, [Assessee in person] Date of Hearing 19.05.2026 Date of Pronouncement 05.08.2026 ORDER PER MANISH AGARWAL, AM : The present appeal is filed by the Revenue against the order dated 10.12.2025 passed by Ld. Commissioner of Income Tax (A), Delhi-42 [“Ld. CIT(A)”] in Appeal No. CIT(A), Delhi-42/10670/2019- 20 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 29.04.2025 passed u/s 147 r.w.s. 144C(3) of the Act, pertaining to Assessment Year 2020-21.

2.

Brief facts of the case are that assessee is a non-resident individual and had not filed the return of income for the year under appeal. Based on the information flagged by the Risk Management Strategy of Insight for non-filing of income tax return despite of the

IT(IT)A No.34/Del/2026

fact that the assessee has term deposit of more than INR 2.35 crores and TDS of INR 732/-, reassessment proceedings were initiated by issue of notice u/s 148 on 27.03.2024. In response, the assessee filed the return of income on 10.04.2024, declaring total income at NIL and claimed refund of INR 230/-. After considering the submission made by the assessee, the AO has made the addition of INR 2.35 crores u/s 69 of the Act as unexplained investment in the term deposits in the order passed u/s 144C(1) of the Act. Since the assessee has not responded within the stipulated time limit nor any appeal was filed before ld. Dispute Resolution Panel (“DRP”) therefore, final assessment order was passed on 29.04.2025 u/s 147 r.w.s. 144C(3) of the Act, confirming the draft assessment order whereby addition of INR 2,35,25,000/- was made u/s 69 of the Act.

3.

Aggrieved by the said order, the assessee filed an appeal before the ld. CIT(A) who vide impugned order dated 10.12.2025, allowed the appeal of the assessee by accepting the fact that the time deposits under reference were made in the preceding AY and during the year they were renewed which fact was ignored. Ld. CIT(A) further verified these facts from the copy of bank statements verified and deleted the addition.

4.

Aggrieved by the order of ld. CIT(A), Revenue is in appeal before the Tribunal by taking following Grounds of appeal: 1. “Whether on the facts and in the circumstances of the case, the Ld CIT Appeal was justified in deleting the addition of Rs.12,35,25,000 made

IT(IT)A No.34/Del/2026

under section 69 of the Income tax Act, 1961, without the assessee conclusively proving the source of investment. 2. Whether the Ld CIT Appeal was erred in law in accepting bank statements as sufficient evidence of source, without establishing creditworthiness and genuineness of the alleged foreign income claim to have funded the investment. 3. Whether the Ld CIT Appeal erred in law by holding that mere 3 reinvestment of term deposits absolves the assessee from explaining the original source of funds under section 69. 4. Whether reliance on acceptance of similar investments in earlier assessment years is legally sustainable, when each assessment year is a separate and independent unit of assessment. 5. Whether the Ld CIT Appeal erred in law and on facts in deleting the addition by relying upon evidences filed during appeal proceedings without calling for a Remand report from the AO, thereby denying the AO all opportunity to verify and rebut such evidences.”

5.

Heard the contentions of both parties at length and perused the material available on record. It is observed that AO has made the addition solely based on the information available in the Insight Portal that assessee has made FDRs of INR 2.35 crores with Kotak Mahindra Bank. It is further observed that no effort was made by the AO of verifying the facts by obtaining the bank statement from the bank and solely on the basis of information as per insight portal, had made the addition. Before ld. CIT(A), assessee not only filed the copies of bank statements indicating the maturity of FDRs and purchase of new FDRs out of the maturity funds and further filed the copies of the assessment order and appellate order for Assessment Years 2018-19 & 2019-20 where the original funds were received from United Arab of Emirates and invested in the FDRs for which the additions were made and deleted in the appellate proceedings. In Assessment year 2018-19 initially, an addition of INR 2,42,00,534/- was made on account of investment

IT(IT)A No.34/Del/2026

in term deposits which was deleted by ld. CIT(A) after considering the fact that all the funds were received from the bank accounts of the assessee with, Emirates NBD Dubai UAE to the Kotak Mahindra Bank, Greater Kailash, Delhi. It is further observed that in next assessment year i.e. in AY 2019-20, the case of the assessee was re- opened based on the information available in the Insight Portal that the assessee has purchased term deposits of INR 2,30,00,000/- and after considering the submissions of the assessee, no addition was made in terms of the orders passed on 06.03.2025 by ACIT, Circle International Tax 1(2)(2). Surprisingly, in the year under appeal, the AO without making any independent inquiry from the bank of the assessee nor even bank statement was obtained to examine the source of the investments, made the addition solely on the basis of information as per Insight portal. Ld. CIT(A) after considering these facts and having examined the bank statements of the assessee, had deleted the addition. The necessary screenshot of the bank statements indicating the maturity of FDR and its subsequent renewal from the same funds is reproduced at page 5 of the appellate order and the ld. CIT(A) after appreciating the fact that new FDRs were purchased out of the maturity amount tabulated at page 6 & 7 of the appellate order, has deleted the additions made.

6.

Before us, Revenue has failed to controvert the specific findings given by ld. CIT(A) nor any contrary material was brought on record to hold that term deposits of INR 2.35 crores were made during the year under appeal out of the fresh funds and no roll over from the maturity of the term deposits was made. This, being so, we

IT(IT)A No.34/Del/2026

find no error in the order of ld. CIT(A) deleting the additions by observing that when no fresh funds were invested, no addition could be made u/s 69 of the Act. Accordingly, all the Grounds of appeal raised by the Revenue are dismissed.

7.

In the result, the appeal of the Revenue is dismissed.

Order pronounced in the open Court on 05.08.2026.

Sd/- Sd/- (VIKAS AWASTHY) (MANISH AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Date-05.08.2026 *Amit Kumar, Sr.P.S*

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