SANJAYBHAI SHANTILAL SHAH,AHMEDABAD vs. THE ITO, WARD-5(3)(1), AHMEDABAD
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal condoned the delay and, upon examining the evidence, found that the assessee had adequately explained the source of investments as a loan from ECL Finance Limited and that the interest earned was below the taxable limit. Consequently, the Tribunal ruled that no addition was warranted and allowed the appeal.
What were the facts?
The assessee challenged an addition of Rs. 40,00,000/- made under Section 69 of the Income Tax Act for investments in financial companies, arguing that the funds were sourced from a loan from ECL Finance Limited. The initial appellate order dismissed the case on limitation grounds without providing a proper hearing, leading to grounds of natural justice violation.
What were the issues?
Whether the addition under Section 69 was justified despite explained source of investment through a loan, and whether the CIT(A) erred by dismissing the appeal on limitation grounds without proper opportunity of being heard.
Which sections of the Income-tax Act were involved?
Section 147,Section 148,Section 69,Section 115BBE,Section 210,Section 234A,Section 234B,Section 234C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
(Assessment Year: 2019-20) Sanjaybhai Shantilal Shah, Income Tax Officer, Vs. B-305, Ward-5(3)(1), Shivalaya-3, Ahmedabad. 100 ft Road, Near Hetvi Tower, Satellite Ahmedabad-380015. [PAN :BOPPS6924 F] (Appellant) .. (Respondent) Appellant by : Shri Jamin Shah, AR Respondent by: Shri B.P Makwana, Sr. DR Date of Hearing 17.07.2025 Date of Pronouncement 18.07.2025 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:- Delay Condoned This appeal is filed by the Assessee against the appellate order dated 21.08.2024 passed by the Commissioner of Income Tax (Appeals) /National Faceless Appeal Centre, Delhi, relating to the Assessment Year 2019-20.
The assessee has raised the following grounds of appeals:
1. That the Ld. CIT(A) has erred both in law and on facts while confirming the order of the AD without giving proper opportunity of being heard and as such the appeal dismissed on grounds of limitation and hence it will require to be set-aside 2. That the appellant is not a techno savvy and hence the appellant has specifically denied for communication of notices on E-mail however without issue of manual communication for hearing notice the appeal dismissed on the ground of limitation is against the provision off natural justice and as such the order passed by NFAC dated 21-08-20024 require to be set aside 03. That the notice issued u/s 148 of the Income Tax Act, by the assessing officer ward 50(7), Ahmedabad is against the provision of law and therefore the whole proceedings are bad in law and require to be quashed 04. That the reasons recorded u/s 147 of the IT. Act, 1961 are vague and therefore the proceedings initiated are bad in law and require to be set aside.
5. That the assessee has furnished all the documents before the assessing officer, however without appreciating the facts and documents the order passed is against the provision of law and therefore the addition made u/s 69 of the Income Tax Act 1961 for Rs. 40,00,000/-requires to be deleted 06. That the appellant has not committed default as defined u/s 115BBE of the IT. Act. 1961, however the assessing officer has applied section 115BBE for taxing at hire rate of Tax is not valid in law and it require to be deleted.
The assessee has not made any default of Sec. 210 nor made any default in payment of advance tax and therefore unwanted interest charged u/s.234A 234B and 234C requires to be deleted.
3. The addition of Rs. 40,00,000/- has been made in the hands of the assessee owing to the investments made in the following companies. i. Tata Capital Finance Services Limited. ii. Mahindra & Mahindra Financial Services Limited. iii. India Bulls Commercial Credit Limited. iv. LNT Finance Limited.
Sanjaybhai S Shah Vs. ITO Asst. Year : 2019-20 - 3– 4. The assessee submitted that he has taken loan of Rs.40,00,000/- from ECL Finance Limited, invested in the following companies bonds and interest earned thereon. The relevant extract is reproduced as under:
Since the sources of the investments have been furnished and the interest earned is less than the taxable limit, we hold that no addition is warranted.
In the result, the appeal of the assessee is allowed.
More judgments on Section 147
- ACIT Central Bilaspur, Bilaspur vs Arun Kumar Agrawal, SaktiITSSA 26/RPR/2025[2018-19]Status: Disposed21 Oct 2026AY 2018-19
- Vinod Agrawal, Kawardha vs Assisstant Commissioner of Income Tax…ITA 666/RPR/2026[2019-20]Status: Heard21 Oct 2026AY 2019-20
- Sar Business Tradelink Private Limited… vs Income Tax Officer, Ward - 1(2), RaipurITA 599/RPR/2026[2014-15]Status: Heard21 Oct 2026AY 2014-15
- Tarunaben Maganlal Bhut, Navagam vs ITO Ward 2(2)(1), RajkotITA 673/RJT/2026[2024-25]Status: Disposed21 Oct 2026AY 2024-25
- Neo Incorporation, Rajkot vs DCIT Circle- 1(2), RajkotITA 471/RJT/2026[2012-2013]Status: Disposed21 Oct 2026AY 2012-2013
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