ASHOK KUMAR JAIN,ARARIA vs. ITO WARD 3(3), PURNEA

ITA 124/PAT/2026Status: DisposedITAT Patna08 October 2026AY 2016-176 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal considered the rival submissions and perused the records. It noted that a search in the case of LRIPL revealed large-scale unaccounted cash sales, recorded in its IVMS software, and that the assessee was a party to substantial cash sales. Statements from LRIPL's director and general manager corroborated the modus operandi of sales suppression. The Tribunal found that the AO had sufficient basis to initiate proceedings under Section 147, as the case did not fall under the ambit of Section 153C since no documents or assets belonging to the assessee were seized. However, the Tribunal noted that the assessee was not provided with the material evidence and was not afforded an opportunity to rebut it, a plea raised before the Ld. CIT(A) but not specifically addressed. The Tribunal concluded that the assessee had not been given a sufficient opportunity to rebut the material evidence. Therefore, in the interest of justice, the Tribunal set aside the impugned assessments for AYs 2014-15 to 2018-19 and restored them to the AO for de novo assessment, with directions to provide all materials/information/evidence/statements to the appellant and afford adequate opportunity of hearing in compliance with the principles of natural justice.

What were the facts?

The assessee, Ashok Kumar Jain, filed appeals against orders of the NFAC, Delhi, for Assessment Years (AYs) 2014-15 to 2018-19. The Assessing Officer (AO) initiated proceedings under Section 147 of the Income Tax Act, 1961, based on information from the Investigation Wing regarding undisclosed sales made by M/s Laxmi Remote India Pvt Ltd (LRIPL) to various parties, including the assessee. The AO made additions under Section 69C for cash purchases from LRIPL, which were not disclosed by the assessee. The amounts added ranged from Rs. 1,69,53,826/- for AY 2014-15 to Rs. 57,19,174/- for AY 2018-19. The Ld. CIT(A) upheld these additions. The assessee appealed these orders.

What were the issues?

1. Whether the proceedings initiated under Section 147 of the Income Tax Act, 1961, are valid, considering the assessee's contention that proceedings under Section 153C were more appropriate and that there was no live link to establish escapement of income. 2. Whether the assessee was denied natural justice due to not being provided with the material evidence relied upon by the Assessing Officer and not being afforded an opportunity to cross-examine witnesses. 3. Whether the additions made under Section 69C are based on conjecture and liable for deletion. Assessee's Contentions: The impugned additions are without basis and were upheld mechanically by the Ld. CIT(A). Proceedings under Section 147 are invalid as there is no live link to establish escapement of income, and Section 153C should have been initiated. The assessee was not provided with material evidence, violating natural justice. All purchases were made by cheque, and the additions were based on conjecture. Revenue's Contentions: The initiation of proceedings was valid and based on information from the Investigation Wing. The Ld. CIT(A) confirmed the additions with reasons, and the order of the Ld. CIT(A) should be upheld.

Which sections of the Income-tax Act were involved?

Section 147,Section 153C,Section 69C,Section 250,Section 132(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB” BENCH: PATNA

Before: Shri Yogesh Kumar U.S & Shri Gopalan Gurusamy

Per Gopalan Gurusamy, AM:

These are the appeals preferred by the assessee against the separate orders of the Ld. Commissioner of Income Tax (Appeals)- NFAC, Delhi (hereinafter referred to as the “Ld. CIT(A)”] passed u/s 250 of the Act in Appeal No. NFAC/2013-14/10072600, NFAC/2014- 15/10072973, NFAC/2015-16/10055744 and NFAC/2016- 17/10058197 dated 01.08.2025 for the AYs 2014-15 to 2017-18 Assessment Years: 2014-15 to 2018-19 Ashok Kumar Jain respectively and in Appeal No. NFAC/2017-18/10089791 dated 10.07.2025 for AY 18-19. As these appeals involve

The order continues below.

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