RAJNEESH KUMAR GUPTA,NEW DELHI vs. ASSESSING OFFICER, NEW DELHI

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ITA 4530/DEL/2026Status: DisposedITAT Delhi23 September 2026AY 2012-134 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessment is unsustainable. The AO reopened the assessee's case based on information that the assessee received interest income of Rs.17,78,541/- during FY 2011-12. However, the addition of Rs.13,50,000/- was made by the AO in respect of alleged unexplained cash credits in the bank account, which was a different issue from the reason recorded for reopening. The Tribunal relied on the judicial pronouncements in Ranbaxy Laboratories Ltd. vs. Union of India and CIT vs. Jet Airways (India) Ltd., which state that an assessment is unsustainable if the addition is made on an issue other than for which the assessment was reopened. Consequently, the impugned order of the CIT(A) was set aside, and the appeal of the assessee was allowed. No issue was expressly left undecided.

What were the facts?

The assessee, Rajneesh Kumar Gupta, filed an appeal against the order of the CIT(A)/Addl./JCIT(A)-9, Mumbai, dated 05.02.2026, for Assessment Year 2012-13. The Assessing Officer (AO) re-opened the assessment based on information that the assessee received interest income of Rs.17,78,541/- during the Financial Year (FY) 2011-12. During assessment, the AO noted cash deposits of Rs.23,50,000/- in the assessee's bank account, against a declared gross turnover of Rs.10,00,000/- for FY 2011-12. The assessee claimed these deposits were from earlier withdrawals, supported by bank statements. However, the AO found no substantial cash withdrawals to justify these deposits and made an addition of Rs.13,50,000/- as unexplained money, representing the difference between total credits and declared turnover.

What were the issues?

1. Whether the assessment is sustainable when the addition made by the Assessing Officer is on an issue different from the reason recorded for reopening the assessment, as per Section 147 of the Income Tax Act, 1961? Assessee's Contention: The assessee argued that the AO reopened the assessment based on information regarding interest income received. However, the addition of Rs.13,50,000/- was made on account of alleged unexplained cash credits in the bank account, which is a different issue. The assessee relied on the decisions in Ranbaxy Laboratories Ltd. vs. Union of India (2011) 336 ITR 136 (Del.) and CIT vs. Jet Airways (India) Ltd. (2011) 331 ITR 236 (Bom.) to support this argument. Revenue's Contention: The revenue, through the learned Departmental Representative (DR), reiterated the findings of the CIT(A) and prayed for upholding the impugned assessment order and dismissing the assessee's appeal.

Which sections of the Income-tax Act were involved?

Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: SHRI VIKAS AWASTHY

Pronounced: 23.09.2026

आयकर अपीलीय अिधकरण, �द�ली पीठ�, नई �द�ली INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES, NEW DELHI BENCH: SMC BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA 4530/DEL/2026 (िनधा�रणवष�/AssessmentYear:2012-13) RAJNEESH KUMAR GUPTA ASSESSING OFFICER 274/4, GALI NO.13, ANAND WARD 50(1), PARVAT, THAN SINGH NAGAR, Vs. NEW DELHI-110002 NEW DELHI-110005 अपीलाथ�Appellant ��थ� Respondent

Permanent Account Number of Assessee: AAGPG5639P

अपीलाथ��ारा/Appellant represented by: Sh. Amit Aggarwal, CA ��थ��ारा/Respondent represented by: Sh. Manoj Kumar, Sr. DR सुनवाईकीतारीख/Date of conclusion of hearing: 24.06.2026 घोषणाकीतारीख/Date of pronouncement: 23.09.2026 आदेश / ORDER

This appeal is filed by the Assessee against the order of CIT(A)/Addl./JCIT(A)-9, Mumbai dated 05.02.2026, for Assessment Year 2012- 13.

2.

Shri Amit Aggarwal, appearing on behalf of the assessee submits that the assessee in appeal has assailed the addition of Rs.13,50,000/- made by AO on account of unexplained money. The AO re-opened the assessment based on information available with the department that the assessee has received interest payment of Rs.17,78,541/- during F.Y. 2011-12. The assessee furnished Bank statement during assessment proceedings. The AO on examination of same questioned source of cash deposits in bank account. The ld. Counsel submits that the assessee explained that cash deposits in the bank account were from earlier withdrawals. The details were furnished before the AO and the CIT(A) but the said submissions of the assessee were rejected. The ld. Counsel for the assessee to supplement his oral submission has also filed written submission.

3.

Per contra, Shri Manoj Kumar, representing the department reiterated findings given by the CIT(A) in confirming the addition of Rs.13,50,000/-. The ld. DR prayed for upholding the impugned assessment order and dismissing appeal of the assessee.

4.

Both sides heard. Orders of the lower authorities examined. The case of the assessee was reopened on the basis of information available with the department that the assessee has received interest payment of Rs.17,78,541/- during F.Y. 2011-12 i.e. relevant to A.Y. 2012-13 under appeal. During the course of assessment proceedings, it transpires that the assessee had deposited cash including other credits of Rs.23,50,000/- during F.Y. 2011-12, whereas, the gross turnover declared by the assessee for F.Y. 2011-12 was Rs.10,00,000/- only. The assessee explained that the cash deposits are from earlier withdrawals. To substantiate his contention, bank statement was furnished before the AO. The AO after examining the bank statements observed that no substantial cash withdrawals are seen from the bank account. Therefore, the assessee’s contention that cash deposits of Rs.23,50,000/- are from earlier withdrawals cannot be accepted. Thus, the AO made addition of the difference between the total credits in the bank account i.e. Rs.23,50,000/- and the total turnover declared i.e. Rs.10,00,000/-, as undisclosed income.

4.1 At the outset, from bare perusal of the assessment order, it emanates that case of the assessee has reopened for the reason that the assessee was received interest of Rs.17,78,541/- during the F.Y. 2011-12. However, no addition has been made by the AO on the reason recorded for reopening. The addition of Rs.13,00,000/- has been made in respect of alleged unexplained cash credits in the bank account of the assessee. It is no more res integra that where the addition has been made on an issue other than for which the assessment was reopened, the assessment is unsustainable. [Re. Ranbaxy Laboratories Ltd. vs. Union of India (2011) 336 ITR 136 (Del.) and CIT vs. Jet Airways (India) Ltd. (2011) 331 ITR 236 (Bom.)]

5.

In light of above findings, the impugned order is set aside and appeal of the assessee is allowed. Order pronounced in the open court on 23.09.2026.

Sd/- VIKAS AWASTHY JUDICIAL MEMBER Delhi Dated: 23.09.2026

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