DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, PATNA, PATNA vs. AJAY KUMAR, BEGUSARAI

ITA 200/PAT/2026Status: DisposedITAT Patna06 October 2026AY 2014-1524 pages
AI SummaryDismissed

What were the facts?

The Revenue filed appeals against the order of the CIT(A) deleting an addition of ₹21.00 crores made by the AO under Section 68 of the Income-tax Act, 1961. The addition pertained to alleged unaccounted cash transactions for Assessment Year 2013-14. The AO had reopened the assessment based on information that the assessee, Ajay Kumar, received ₹53.05 crores from Shri Iqbal Singh Sodhi for a joint venture project, of which ₹41.60 crores was allegedly received in cash, including ₹20.60 crores in AY 2013-14. The AO also noted two unsecured loans of ₹1.00 crore each from M/s Saviour Builders Pvt. Ltd. to M/s New Way Homes Pvt. Ltd. The CIT(A) deleted the addition, finding that the reassessment was based on a confidential report and unprovided or incomplete documents, and that the assessee was not given an adequate opportunity to examine the evidence.

What did the Tribunal hold?

The Tribunal upheld the order of the CIT(A) and dismissed the Revenue's appeal. The Tribunal found that the CIT(A)'s order was well-reasoned. The addition made by the AO was based on a confidential report and incomplete/unauthenticated documents, which were not provided to the assessee despite repeated requests, thus denying a fair opportunity to present their case. The Tribunal noted that the alleged cash receipts were never found in the assessee's possession, and the presumption under Section 132(4A) read with Section 292C would not apply. Furthermore, the Tribunal observed that the department had accepted that there was no material to corroborate the alleged cash payments and that the investigation wing affirmed that such receipts were not available with them. The Tribunal also noted that the Xerox copies relied upon were uncorroborated, inconsistently signed, and unreliable. The Tribunal further emphasized the principle of consistency, stating that the department cannot take contradictory stands on the same facts. The Tribunal concluded that the transactions referred to by the department were either loans that were repaid or for share subscription, thus demolishing the department's stand that these were part of undisclosed consideration. Consequently, the appeal of the Revenue was dismissed.

What were the issues?

1. Whether the addition of ₹21.00 crores as unexplained cash transactions under Section 68 of the Income-tax Act, 1961, made by the Assessing Officer (AO) is sustainable, considering the evidence relied upon and the opportunity provided to the assessee? Assessee's contentions: - The reassessment was initiated solely on the basis of a confidential report from ITO (Inv.), Delhi, and alleged documents which were never fully furnished despite repeated requests. - The ledger extracts and cash receipts provided were incomplete, unauthenticated, and only partially supported the allegations. - The AO refused to provide remaining documents citing confidentiality, thus denying the assessee an adequate opportunity to examine the evidence. - The presumption under Section 132(4A) read with Section 292C does not apply to the assessee as the documents were not found in their possession. - Relied on Mani Square Ltd. v. ACIT and Roma Traders v. First ITO. - The department has inconsistently treated the transactions. - Relied on Deoniti Prasad Sing Vs. CIT and Radhasoami Satsang Vs. CIT. Revenue's contentions: - The judgment records no specific contentions for the Revenue beyond its appeal against the CIT(A)'s deletion.

Which sections of the Income-tax Act were involved?

Section 68,Section 147,Section 148,Section 143(2),Section 142(1),Section 151,Section 271(1)(c),Section 132(4A),Section 292C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PATNA BENCH, PATNA

Before: SHRI DUVVURU RL REDDY, VP & SHRI RAJESH KUMAR, AM

For Appellant: Shri S.K. Tulsiyan&
For Respondent: Shri Bharat Bhusan Garg, DR
Hearing: 02.09.2026Pronounced: 06.10.2026

Per Rajesh Kumar, AM:

These appeals of the Revenue and COs of the assessee are against the order of the Commissioner of Income-tax (Appeals), Patna-3 (hereinafter referred to as the “Ld. CIT(A)”]even dated 12.12.2025 for the AYs2013-14, 2014-15. ITA Nos. 196 & 200

The order continues below.

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