RAJESH JAIN,KHANDWA vs. ITO-1, KHANDWA, KHANDWA

This is an Appeal filed by the Assessee under section 253 of the Income Tax Act 1961, [ herein after referred to as the Act for the sake of brevity] before this tribunal as & by way of a second Appeal. The Assessee is aggrieved by the order dated 06.08.2026 passed by the Ld. CIT(A) U/S 250 of the Act, which is herein after referred to as the “Impugned Order”.

The assessee filed the return of income under section 139(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for A.Y. 2023-24, declaring a total income of Rs 13,46,030/-, which was processed under section 143(1) of the Act on 30.10.2023, accepting the returned income. Subsequently, the case was selected for scrutiny under CASS to examine the issue of low profit.

The learned Assessing Officer (AO) completed the assessment under section 143(3) of the Act on 15.03.2025, determining the total income at Rs 42,73,064/-, after making an addition of Rs 29,27,034/- under section 68 of the Act on account of unexplained unsecured loans received from the assessee's mother-in-law.

Aggrieved by the assessment order passed by the learned Assessing Officer (AO), the assessee preferred an appeal before the learned Commissioner of Income Tax (Appeals) [CIT(A)]. The learned CIT(A), vide order dated 06.08.2026, upheld the findings of the learned AO and confirmed the assessment order. Being dissatisfied with the order of the learned CIT(A), the assessee has preferred the present appeal before this Tribunal, raising the following grounds of appeal: - 1.The Id CIT(A) was not justified in confirming the addition of Rs. 29,27,034/-on account of unexplained cash credit u/s 68 without considering the facts and circumstances of the case. 2.The Ld. CIT(A) was not justified in confirming the applicability of section 115BBE without considering the facts and circumstances of the case.

During the relevant financial year, the assessee received loans of Rs 20,00,000/- on 13.10.2022 and Rs 9,27,034/- on 24.01.2023 from his mother-in-law. During the assessment proceedings, the assessee furnished the confirmation of loan, identity particulars of the lender, computation of income and details of transactions through banking channels. It was explained that the source of funds was the sale proceeds of immovable property belonging to the lender.

However, the assessee inadvertently furnished the bank statement of the lender pertaining to F.Y. 2021-22 instead of F.Y. 2022-23. Consequently, the learned AO treated the loans aggregating to Rs 29,27,034/- as unexplained cash credits under section 68 of the Act.

During the appellate proceedings before the Tribunal, the assessee filed an application dated 05.10.2026 under Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963, seeking admission of additional evidence comprising the relevant bank statement of the lender for F.Y. 2022-23, revised return of income and computation of income reflecting the sale of immovable property, which had not been disclosed in the original return.

The learned Departmental Representative (Ld. DR) relied upon the orders of the authorities below. However, the Ld. DR fairly submitted that he had no objection to the prayer made by the

We have heard the rival submissions of the learned Authorised Representative (AR) and the learned Departmental Representative (DR) and perused the material available on record, including the application filed under Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963.

We observe that the addition of Rs 29,27,034/- was made under section 68 of the Act in respect of unsecured loans received from the assessee's mother-in-law. The assessee had furnished the identity particulars and confirmation of the lender and explained that the transactions were carried out through banking channels. However, the bank statement pertaining to the relevant financial year was not furnished before the learned AO.

We further observe that the assessee has now furnished the relevant bank statement for F.Y. 2022-23, along with the revised return of income and computation of income of the lender, as additional evidence. These documents are material for examining the genuineness of the transactions and the creditworthiness of the lender.

Considering the facts and circumstances of the case, we are of the considered view that the additional evidence is relevant for the proper adjudication of the issue involved. Accordingly, the

Since the additional evidence was not examined by the learned AO during the assessment proceedings, we deem it appropriate, in the interest of justice, to restore the matter to the file of the learned AO for fresh examination. The learned AO shall verify the relevant bank transactions, source of funds, financial capacity of the lender and supporting documents relating to the sale of immovable property and thereafter decide the issue afresh in accordance with law, after providing reasonable opportunity of being heard to the assessee.

We make it clear that we have not expressed any opinion on the merits of the additions made by the learned Assessing Officer, and all issues relating thereto are left open for adjudication in accordance with law.

Accordingly, the addition of Rs 29,27,034/- made under section 68 of the Act is restored to the file of the learned AO for fresh adjudication.

In the result, the appeal of the assessee is allowed for statistical purposes.