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Facts
The assessee's appeal arose from an order confirming additions made beyond the scope of limited scrutiny. The AO had made additions regarding undisclosed sources of money, excess profit, and cash deposit, which were partly confirmed by the CIT(A). The assessee challenged the part confirmation.
Held
The Tribunal held that the additions made by the AO were beyond the scope of limited scrutiny and thus without jurisdiction. Consequently, the Tribunal directed the AO to delete the additions.
Key Issues
Whether additions made by the AO were beyond the scope of limited scrutiny and thus without jurisdiction.
Sections Cited
250, 69A, 69A
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Income Tax Appellate Tribunal, “SMC” BENCH,KOLKATA
Appearances by: Assessee represented by : Deep Agarwal, Adv. Department represented by : Monalisa Pal Mukherjee, Sr. DR Date of concluding the hearing : 17.12.2025 Date of pronouncing the order : 19.12.2025 O R D E R The present appeal filed by the assessee arise from order dated 14.12.2024 passed u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) by the Ld. Additional/Joint Commissioner of Income Tax (Appeals) [hereafter “the Ld. Addl./JCIT(A)].
At the outset, we note that the appeal of the assessee is barred by limitation by 110 days. At the time of hearing, the counsel of the assessee explained the reasons for delay in filing the appeal. The Ld. D.R did not raise any objections in condoning the delay. After hearing the rival contentions and perusing the materials available on record, we find that
The assessee challenged the order of Ld. CIT(A) upholding the assessment order wherein the addition is made beyond the scope of limited scrutiny.
The facts in brief are that the assessee filed return of income on 30.03.2017 declaring total income of Rs. 7,62,300/-. The case of the assessee was selected for scrutiny whether the cash deposited has been made from the disclosed process. The AO during the course of assessment proceedings exceeded his jurisdiction by making addition in respect of undisclosed sources of money u/s 69A Rs. 11,69,965/-, Rs. 6,26,929/- on account of undisclosed income in respect of excess profit u/s 69A of the Act and Rs. 43,632/- in respect of cash deposit.
In the appellate proceedings the Ld. CIT(A) PARTLY confirmed the addition.
Now before us the assessee has challenged the part confirmation of additions. We observe from the appellate order as well as the assessment order, the first issue is that the addition made by the AO in respect of the excess cash disclosed in the cash balance in the return of income which has been reduced to Rs. 4,19,896/-by the Ld. CIT(A). In our opinion, the addition itself beyond the scope of limited scrutiny, therefore, the AO has no jurisdiction to make such addition. Consequently, we direct the AO to delete the addition. The second addition which was made by the AO to Rs. 6,26,983/-. The said addition was made by the AO on account of non disclosure of excess profit made by the assessee. The addition is not the subject matter of limited scrutiny. Therefore, we set aside the order of ld. CIT(A) on this issue and direct the AO to delete the addition. So far as the third addition made of Rs. 43,632/-, we note that the said addition made
In result, appeal of the assessee is allowed.
Order pronounced on 19.12.2025