HOTEL SAI YATRI,SHIRDI vs. WARD 5, AHMADNAGAR

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ITA 1944/PUN/2025Status: DisposedITAT Pune16 October 2026AY 2016-1710 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found merit in the assessee's arguments. It noted that the total additions to fixed assets as per the books of account (Rs. 1,13,16,720/-) exceeded the amount found in the impounded documents (Rs. 36,52,638/-). Furthermore, the assessee's counsel substantiated that all entries from the seized material had already been incorporated into the regular books of account. Consequently, the Tribunal held that no addition was warranted solely based on the partner's statement during the survey proceedings, in the absence of any other evidence demonstrating that renovation expenses were incurred but not recorded. The order of the CIT(A) was set aside, and the AO was directed to delete the addition. The grounds raised by the assessee were allowed.

What were the facts?

The assessee, Hotel Sai Yatri, a partnership firm engaged in the hotel business, filed its return for assessment year 2016-17. The case was reopened based on a survey under Section 133A, where a partner admitted undisclosed renovation expenses of Rs. 44 lakhs. The Assessing Officer (AO) made an addition of Rs. 44 lakhs. The CIT(A) sustained an addition of Rs. 22 lakhs. The assessee appealed to the ITAT, arguing that no renovation expenses were incurred and that additions to fixed assets in the books of account exceeded the amounts found in impounded documents. The revenue relied on the CIT(A)'s order.

What were the issues?

1. Whether the addition of Rs. 22 lakhs sustained by the CIT(A) on account of undisclosed renovation expenses is justified, considering the assessee's contention that no such expenses were incurred and that book additions exceeded impounded document amounts (Question of law and fact, related to Section 69 of the Income Tax Act, 1961). Assessee's Contention: The assessee argued that no renovation expenses were incurred. They submitted that additions to fixed assets in their books of account, totaling Rs. 1,13,16,720/-, far exceeded the Rs. 36,52,638/- found in impounded documents. They further contended that all figures from the impounded materials were already recorded in the regular books of account, rendering any addition unjustified. Revenue's Contention: The revenue heavily relied on the order of the CIT(A).

Which sections of the Income-tax Act were involved?

Section 133A,Section 148,Section 143(2),Section 142(1),Section 69

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE

Before: SHRI R. K. PANDA & Ms. ASTHA CHANDRA

For Appellant: Shri Rohit Parakh
For Respondent: Ms. Pradnya Gholap, JCIT

आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपील र्थी / The Appellant; प्रत्यर्थी / The Respondent 2. 3. The concerned Pr.CIT, Pune 4. DR, ITAT, ‘SMC’ Bench, Pune ग र्ड फ ईल / Guard file. 5. आदेशानुसार/ BY ORDER, Digitally signed by Sunil Kumar // True Copy // Sunil Kumar More More Date: 2026.10.25 10:55:56 +05'30' Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune

10 ITA No.1944/PUN/2025

S.No. Details Date Initials Designation 1 Draft dictated on 13.10.2026 Sr. PS/PS 2 Draft placed before author 16.10.2026 Sr. PS/PS Draft proposed & placed before 3 JM/AM the Second Member Draft discussed/approved by 4 AM/AM Second Member Approved Draft comes to the 5 Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS Date on which the file goes to 9 the Office Superintendent Date on which file goes to the 10 A.R. 11 Date of Dispatch of order

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