LATE HETALKUMAR GUNVANTLAL SONI (THROUGH LEGAL HEIR MEETABEN SONI),AHMEDABAD vs. ITO WARD 1(2)(3), AHMEDABAD

ITA 462/AHD/2026Status: DisposedITAT Ahmedabad09 October 2026AY 2012-1311 pages
AI SummaryAllowed

What were the facts?

The assessee, Late Hetalkumar Gunvantlal Soni, filed a return for AY 2012-13 declaring Rs. 3,26,000. The Assessing Officer (AO) reopened the assessment based on information that the assessee had taken an accommodation entry of Rs. 7,85,600 from M/s. Vinit Enterprise. A notice under section 148 was issued on 30.09.2019. The assessee did not comply, and the AO completed the assessment under section 144 r.w.s 147 on 29.11.2019, determining the total income at Rs. 75,07,759. The CIT(A) partly allowed the assessee's appeal. The assessee is now in appeal before the ITAT against the CIT(A)'s order dated 10.02.2026.

What did the Tribunal hold?

The Tribunal held that the AO had proceeded merely on the basis of information received from the Investigation Wing without carrying out necessary independent verification, especially after the assessee disputed the number and quantum of transactions. The material on record did not establish that the assessee received Rs. 7,85,000 from M/s. Vinit Enterprise or that it was an accommodation entry. The Tribunal noted that the reasons recorded by the AO lacked specific dates and particulars of the alleged transactions, and the AO did not undertake independent verification, such as checking bank statements, to ascertain the correctness of the entries. The Tribunal found that the alleged entry of Rs. 7,85,600 was based on a single entry of Rs. 98,200 being repeated eight times, which was not substantiated. Consequently, the addition of Rs. 7,85,000 on account of the alleged accommodation entry from M/s. Vinit Enterprise was deleted. Following the Gujarat High Court decision in *CIT v. Mohmed Juned Dadani*, the Tribunal held that if the addition forming the basis of reassessment does not survive, other additions made in reassessment proceedings are also not sustainable. Accordingly, all remaining additions made by the AO were deleted. The Tribunal also noted that since the grounds on merits were allowed, it was not necessary to adjudicate the legal grounds. The appeal of the assessee was allowed.

What were the issues?

1. Whether the reassessment proceedings are bad in law and on facts, specifically concerning: a) fulfillment of reopening conditions, b) borrowed satisfaction, c) non-provision of reasons and sanction under section 151, d) discrepancy between alleged bogus entry amount and total addition, e) non-provision of relevant documents, and f) assessment order passed in the name of a deceased assessee. The assessee argued that the reassessment was based on borrowed satisfaction, lacked independent recording of reasons, and crucial documents were not provided. The assessee also contended that the alleged bogus entry of Rs. 7,85,600 was factually incorrect, and the assessment order was passed after the assessee's death. 2. Whether the reassessment proceedings are invalid as notice under section 153C ought to have been issued instead of section 148, given the information originated from a search in the case of Shri Jignesh Shah, relying on the Gujarat High Court decision in *Paras Chandreshbhai Koticha*. 3. Whether the CIT(A) erred in not considering the assessee's submissions and legal decisions against reassessment proceedings. 4. Whether the additions made by the AO as unexplained money/receipts are sustainable, specifically: A. Unexplained money credited in Dhanlaxmi Bank A/c Rs. 7,85,500, B. Unexplained cash credit in Development Credit Bank Ltd. Rs. 15,42,500, C. Unexplained cash credit in Ratnakar Credit Bank Ltd. Rs. 9,00,000. The assessee argued that these additions were made without proper appreciation of evidence. 5. Whether additions ought to have been upheld given the return was filed under section 44AD. 6. Whether interest under sections 234A, 234B, 234C, and 234D was leviable without a computation sheet. 7. Whether the return income of Rs. 3,26,000 computed under section 44AD ought to have been accepted. The Revenue supported the order of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 148,Section 151,Section 153C,Section 234A,Section 234B,Section 234C,Section 234D,Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD

Before: SHRI NARENDRA PRASAD SINHA & SHRI SANJAY KUMAR

For Appellant: Shri P. F. Jain, CA
For Respondent: Shri Arvind Kumar Namdeo, SR-DR
Hearing: 17.09.2026Pronounced: 09.10.2026

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

This appeal has been filed by the Assessee against the order of National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] dated 10.02.2026 for the Assessment Year (A.Y.) 2012-13 in the proceeding u/s 144 r.w.s. 147 of the Income Tax Act [hereinafter referred as “the Act”].

2.

The brief facts of the case are that the assessee had filed his return of income for A.Y. 2012-13 on 11.10.2012 declaring total income of Late Hetalkumar Gunvantlal Soni (Through Legal Heir Meetaben Soni) Vs ITO, AY- 2012-13 2 Rs.3,26,000/-. The case of the

The order continues below.

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