AMRITVARSHA INDUSTRIES LIMITED,AMBEDKAR ROAD vs. ASSISTANT COMMISSIONER OF INCOME TAX, MUZAFFAR NAGAR

ITA 6481/DEL/2026Status: DisposedITAT Delhi07 October 2026AY 2010-20115 pages
AI SummaryPartly Allowed

What were the facts?

During a survey under Section 133A on February 3, 2010, Amritvarsha Industries Limited (the assessee) surrendered Rs. 1,50,00,000/- for unexplained expenses. In its return of income for Assessment Year 2010-11, the assessee declared only Rs. 1,00,00,000/-. The Assessing Officer (AO) added the differential of Rs. 50,00,000/-, finding discrepancies in the books of accounts. The assessee argued the surrender was under stress and retracted the statement, asserting no other material supported the Rs. 1,50,00,000/-. The CIT(A) upheld part of the addition, providing relief of Rs. 30,00,000/- and confirming an addition of Rs. 20,00,000/-. The assessee appealed to the ITAT.

What did the Tribunal hold?

The Tribunal held that a bald statement recorded during a survey, if contested later, cannot be the sole basis for an addition. While the CIT(A) acknowledged this to some extent, neither the AO nor the CIT(A) presented substantial discrepancies between the books found during the survey and the income declared. Therefore, the Tribunal directed the deletion of the remaining addition of Rs. 30,00,000/- (out of the Rs. 50,00,000/- added by the AO). Regarding other additions (Rs. 1,00,000/-, Rs. 28,529/-, and Rs. 1,50,000/-), the Tribunal noted they were not adjudicated by the CIT(A) despite being raised in the grounds of appeal, possibly due to confusion in the ground drafting. Consequently, these remaining issues were remanded back to the CIT(A) for adjudication on merits. The principle established is that surrenders made under stress require corroborative evidence for additions, and appellate authorities must adjudicate all grounds raised.

What were the issues?

1. Whether the addition of Rs. 50,00,000/- (the difference between the surrendered amount of Rs. 1,50,00,000/- and the declared amount of Rs. 1,00,00,000/-) was justified, considering the assessee's retraction of the surrender statement made under stress during the survey? Assessee's contention: The surrender was made under stress, and upon examination of vouchers and books, the entire amount could not be justified. The AO should have examined all material gathered during the survey, not just the confessional statement, as per CBDT Circular No. 286/2/2003. A bald statement without supporting material has no value. Discrepancies were due to the company maintaining three cash books, and only one was examined. The CIT(A) failed to adjudicate other grounds related to additions of Rs. 1,00,000/-, Rs. 28,529/-, and Rs. 1,50,000/-. Revenue's contention: The discrepancies noticed during the survey were never satisfactorily explained by the assessee. The retraction of the statement was an afterthought, as the assessee could not reconcile its books maintained at multiple locations. The remaining additions made by the AO were not adjudicated by the CIT(A).

Which sections of the Income-tax Act were involved?

Section 133A,Section 250,Section 43B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “G” NEW DELHI

Before: SHRI SATBEER SINGH GODARA & SHRI SANJAY AWASTHI

For Appellant: Shri Anurag Jain, CA
For Respondent: Shri Novel Roy, Sr. DR
Hearing: 08.09.2026

PER SANJAY AWASTHI, ACCOUNTANT MEMBER:

1.

This appeal arises from order dated 26.05.2026, passed by Ld. CIT(A), NFAC, u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”).

1.

1 In this case, a survey was conducted u/s 133A of the Act on 03.02.2010. During the course of such survey the assessee had admittedly surrendered an amount of Rs.1,50,00,000/- on account of certain expenses which could not be explained at that point of time. Thereafter, in the return of income the assessee accounted for only Rs.1,00,00,000. The Ld. AO gave an opportunity to the assessee to explain why there

The order continues below.

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