INCOME TAX OFFICER, SIRSA vs. SUNITA BANSAL, SIRSA

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ITA 1637/CHANDI/2025Status: DisposedITAT Chandigarh05 October 2026AY 2013-143 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A)'s order suffered from inconsistencies and cryptic findings, failing to address the issues raised in the assessment order. Specifically, the Tribunal noted ambiguity regarding whether fresh loans were received during the year, which was not confirmed by either the AR or the DR. The CIT(A)'s reasoning for deleting the addition on account of unexplained sales, stating that bank credits comprise receipts from all sources and may not match sales, was considered insufficient. The Tribunal held that in the interest of justice, the matter should be restored to the file of the CIT(A) for de novo adjudication. The CIT(A) was directed to consider all aspects, potentially call for a Remand Report from the AO, and pass a well-reasoned speaking order. The appeal of the Revenue was allowed for statistical purposes.

What were the facts?

The Revenue filed an appeal against the order of the CIT(A)/NFAC, Delhi, dated 17/11/2025, concerning Assessment Year 2013-14. The Assessing Officer (AO) had made additions of Rs. 1,35,72,998/- on account of unsecured loans and Rs. 2,06,74,881/- for unexplained sales. The AO's additions were based on the assessee's failure to provide cogent explanations and evidence regarding the creditworthiness of loan creditors and the genuineness of transactions, as well as discrepancies in turnover reported in VAT returns, ITR, and bank account credits. The CIT(A) deleted a portion of the unsecured loan addition (Rs. 78,70,954/-) and the entire unexplained sales addition.

What were the issues?

1. Whether the CIT(A) erred in law and on facts by deleting an addition of Rs. 78,70,954/- out of Rs. 1,35,72,998/- made on account of unsecured loans, when the assessee allegedly failed to furnish cogent explanation and evidence to prove the creditworthiness of creditors and genuineness of transactions (Section 68 of the Income Tax Act, 1961). 2. Whether the CIT(A) erred in law and on facts by deleting an addition of Rs. 2,06,74,881/- on account of unexplained sales, when the assessee allegedly failed to furnish documentary evidence for credit entries exceeding the reported turnover (Section 69 of the Income Tax Act, 1961). Assessee's Contention: The assessee's Authorized Representative (AR) supported the order of the CIT(A). Revenue's Contention: The Revenue's Additional Commissioner of Income Tax, Senior Departmental Representative (DR), argued that the CIT(A)'s order suffered from ambiguities and did not address the AO's contentions. The DR highlighted ambiguity regarding whether fresh loans were received during the year. The DR also contended that the CIT(A) merely reproduced the assessee's reconciliation of P&L Account, bank credits, and VAT return without independent reasoning, and that the finding in para 8.1 was cryptic.

Which sections of the Income-tax Act were involved?

Section 68,Section 147,Section 144B,Section 69

AI-generated summary — verify with the full judgment below

आयकर अपीलीय अिधकरण,च�ीगढ़ �ायपीठ “बी” , च�ीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH HEARING THROUGH: VIRTUAL MODE �ी लिलत कुमार, �ाियक सद� एवं �ी िवजय वमा� , लेखा सद� BEFORE: SHRI. LALIET KUMAR, JM & SHRI. VIJAY VARMA, AM आयकर अपील सं./ ITA No. 1637 /Chd/ 2025 िनधा�रण वष� / Assessment Year : 2013-14 The ITO बनाम Sunita Bansal Sirsa M/s Bansal Corporation, Shop No. 17, 1st Floor, Kapas Mandi, Sirsa, Haryana-125055 �ायी लेखा सं./PAN NO: CIPPS7889Q अपीलाथ�/Appellant ��थ�/Respondent िनधा�रती की ओर से/Assessee by : Shri Rittun Sahuwala, C.A राज� की ओर से/ Revenue by : Dr. Ranjit Kaur, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 30/09/2026 उदघोषणा की तारीख/Date of Pronouncement : 05/10/2026 आदेश/Order PER VIJAY VARMA, A.M: This is an appeal filed by the Revenue against the order of the Ld. CIT(A)/NFAC, Delhi dt. 17/11/2025 for the Assessment Year 2013-14.

2.

In the present appeal Revenue has raised the following grounds: 1. The Ld. CIT(A) has erred in law and on facts in deleting the addition of Rs.78,70,954/- out of total addition made of Rs.1,35,72,998/- on account of unsecured loans raised when the assessee did not furnish any cogent explanation and evidence to prove the creditworthiness of the creditors and genuineness of transactions. 2. The Ld. CIT(A) has erred in law and on facts in deleting the addition of Rs.2,06,74,881/- on account of unexplained sales when the assessee did not furnish any documentary evidence with regard to credit entries over and above the turnover reported by the assessee in his return of income. 3. The appellant craves to leave, add, amend, alter, vary or modify any of the ground of appeal before the appeal is finally adjudicated upon. 3. The AO in this case made an addition of Rs. 1,35,72,998/- for unsecured loans and Rs. 2,06,74,881/- for uncounted sales. In the order passed under section 147 r.w.s 144B, the addition was made as the assessee could not file the evidence to support its claim of unsecured loans nor could the assessee explain the difference in the turnover as per VAT return, ITR and credits in the bank account.

2 4. The order of the Ld. CIT(A) mentions that the assessee had not received any fresh loans. However, there is some ambiguity related to facts. In para 6.13 of the order of the Ld. CIT(A), it is mentioned that no fresh loans were received during the year under consideration. However neither the Ld. AR nor the Ld. DR could confirm whether it is a fact or not. If no fresh loans were received during the year the addition cannot be made in the assessment year 2013-14. While some details regarding the bank reconciliation, VAT return were submitted, the Ld. CIT(A) in para 8.1 has observed that the bank account of the assessee would comprise receipt from all sources and not necessarily only the revenue receipt and on this ground the Ld. CIT(A) deleted the addition of Rs. 2,06,74,881/-. Out of the addition for unsecured lonas also an addition of Rs. 78,70,954/- was deleted. 5. The Revenue is in appeal before us against these two reliefs granted by the Ld. CIT(A). 6. The Ld. AR supported the order of the Ld. CIT(A).

7.

The Ld. DR submitted that the order of the Ld. CIT(A) suffers from ambiguities and does not address the contention raised by the AO in the assessment order. He also refers to the ambiguity regarding fresh loans received during the year under consideration.

8.

Regarding the reconciliation of P&L Account, bank credits and VAT return, she submitted that the Ld. CIT(A) has simply reproduced the reconciliation filed by the assessee but has not given his own reasoning how the said reconciliation is correct and has given a very cryptic finding in para 8.1 of the appellate order which is reproduced herein under: 8.1 It may be appreciated that the revenue receipts, capital receipts and any other receipts credited in the books of accounts of the assessee. Therefore, the bank account of the assessee would comprises of the receipts from all sources which may or may not be part of the trading account of the assessee comprising turnover/total sales. Therefore, there is merit in the argument of the assessee that the total of credit entries in the bank account shall not match the total sales of the assessee. 9. We have considered the rival contention and the order of the Ld. CIT(A), who has not addressed the issues raised in the assessment order and is cryptic and suffers from inconsistency. Therefore in the interest of justice the matte is restore back to the file of the Ld. CIT(A) for denovo adjudication of the appeal without being influenced by our observation in this order.

3 10. All the contentions of the assessee and the AO shall be open and he/she shall pass the appellate order after considering all the aspects and if necessary by calling a Remand Report from the AO and thereafter passing a well reasoned speaking order in accordance with law. 11. In the result, appeal of the Revenue is allowed for statistical purposes.

Order pronounced on 05/10/2026

Sd/- Sd/- लिलत कुमार िवजय वमा� (LALIET KUMAR) (VIJAY VARMA) �ाियक सद� /JUDICIAL MEMBER लेखा सद�/ ACCOUNTANT MEMBER AG आदेश की �ितिलिप अ�ेिषत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��थ�/ The Respondent 3. आयकर आयु�/ CIT 4. आयकर आयु� (अपील)/ The CIT(A) 5. िवभागीय �ितिनिध, आयकर अपीलीय आिधकरण, च�ीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File ANUPA Digitally signed by ANUPAMA MA GHERA Date: BY ORDER, 2026.10.22 GHERA ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL 16:32:49 +05'30' KENDRIYA SADAN, SECTOR-9A CHANDIGARH

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