DY. COMMISSIONER OF INCOME-TAX, INTERNATIONAL TAXATION, JAIPUR, JAIPUR vs. BHARAT KUMAR MANGHNANI, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर
IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR

Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh xxu xks;y] ys[kk lnL;] ds le{k
BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI GAGAN GOYAL, AM vk;dj vihy la-@ITA No. 872/JPR/2025
fu/kZkj.k o"kZ@Assessment Years : 2018-19
LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: ARPPM2890Q vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Mrs. Suhani Meharwal, C.A.
jktLo dh vksjls@Revenue by : Mrs. Alka Gautam, CIT-DR lquokbZ dh rkjh[k@Date of Hearing

12/08/2025

mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 29/09/2025

vkns'k@ORDER

PER: DR. S. SEETHALAKSHMI, J.M.

This is an appeal filed by the revenue against the order of ld. CIT (A), Delhi-
42 dated 29.03.2025 passed under section 250 of the I.T. Act, 1961, for the assessment year 2018-19. 2. The assessee has raised the following grounds of appeal :-
“1.1 Whether on the facts and in the circumstances of the case and in law, the learned
Commissioner of Income Tax (Appeals) has erred in admitting the additional evidences filed by the assessee in contravention to rule 46A of the Income Tax Rules which mandates

2
Mr. Bharat Kumar Manghnani, Jaipur.

that no additional evidence shall be admitted by the CIT (Appeals) without providing opportunity to the AO to examine the evidence or document or to cross examine the witness produced by the appellant ?

3
Mr. Bharat Kumar Manghnani, Jaipur.

has entered into following transactions such as (i) Purchased Time Deposit of Rs.
3,66,00,063/- from SBI Bank, (ii) having account balance of Rs. 34,53,197/- with ICICI bank account, (iii) made payment to non-resident amounting to Rs. 76,845/- and (iv) received foreign remittance of Rs. 1052/- during the financial year 2017-
18. Assessee has entered into large transactions but has not filed his return of income for the assessment year 2018-19. On the basis of information, notice under section 148 of the Income Tax Act, 1961 was issued to the assessee on 29.03.2022
after recording reasons and obtaining approval from the competent authority under section 151 of the I.T. Act, 1961. Notices under section 142(1) dated 17.10.2022,
22.11.2022, 30.12.2022, 10.03.2022 and Show Cause notice dated 16.03.2022
were issued by the AO to the assessee to furnish requisite details. In response to the statutory notices, assessee did not make any compliance to the said notices and failed to furnish requisite documentary evidence regarding the source of funds to make above mentioned transactions. Since the assessee failed to explain the source of investment even after providing sufficient opportunities, therefore, the source of investment of Rs. 3,66,00,063/- remained unexplained and thus the AO added the same to the total income of the assessee on account of unexplained investment under section 69 of the IT Act, 1961. Further, it is also mentioned by the AO in the assessment order that the assessee had account balance of Rs. 34,53,197/- with ICICI Bank and received interest income of Rs. 76,845/- and received foreign

4
Mr. Bharat Kumar Manghnani, Jaipur.

remittance of Rs. 1052/- which is reported under section 285BA(1). As the assessee did not produce any justification or documentary evidence regarding source of funds used to do these transactions, therefore, these transactions of Rs.
35,31,094/- remain unexplained and added back to the income of the assessee as unexplained money under section 69A of the IT Act, 1961. Thus, the AO assessed the total income of the assessee at Rs. 4,01,31,160/- vide his order passed under section 147 read with section 144 of the IT Act, 1961 dated 26.05.2023. Aggrieved by the assessment order, the assessee preferred an appeal before the ld.
CIT (A). The ld. CIT (A) after discussing the matter in detail, allowed the appeal of the assessee by deleting the additions.

Now, being aggrieved by the order of the ld. CIT (A), the revenue has come in appeal before the Tribunal on the grounds reproduced herein above.

5
Mr. Bharat Kumar Manghnani, Jaipur.

“ The ld. CIT (A) has passed a well-reasoned and speaking order, which deserves to be upheld. The grounds raised by the Department are devoid of merit. Our point-wise submissions are as follows :

Ground No. 1.1 : Admission of Additional Evidence under Rule 46A
 Ld. DR has contended that the ld. CIT (A) erred in admitting additional evidence under Rule 46A of the Income Tax Rules, 1962.  However, no additional evidence was admitted by the ld. CIT (A). It is true that the assessee had initially filed an application under Rule 46A, but the same was voluntarily withdrawn on 27.03.2025, well before the disposal of the appeal.
 A copy of the withdrawal application is placed in the Paper Book at page no. 1.  Therefore, the allegation that the CIT (A) admitted additional evidence is factually incorrect and Ground No. 1.1 deserves to be dismissed.

Ground NO. 1.2 : Opportunity to Examine the Evidence
 This ground is merely an extension of Ground No. 1.1.  All evidence relied upon by the ld.CIT (A) was already on record and had been submitted before the ld. Assessing Officer (AO) well in advance – more than 40
days prior to the passing of the assessment order.
 These documents include : placed on page no. 2-25 of paper book
-
Copies of all NRE bank accounts,
-
Copy of the passport to establish NRI status,
-
Employee’s certificate demonstrating adequate income
-
Details of FDRs made from the NRE accounts, etc.

 The ld. AO failed to consider these documents despite being available on record.
 Hence, the claim that the Department was not given an opportunity to examine the evidence is factually incorrect and untenable in law.

Ground No. 1.3 : Addition under Section 69 – Unexplained investment in FDRs
 The ld. CIT (A) has dealt with the addition in detail in paragraph 8 of his order.
 In para 8.1, the ld. CIT (A) categorically holds that the assessee is an NRI for over
40 years.
 In para 8.2, the ld. CIT (A) finds merit in the assessee’s explanation and is satisfied with the capacity to invest, based on the foreign remittances and documentation submitted.
 In para 8.3, it is clearly recorded that the remittances in the NRE accounts were foreign receipts, and thus not taxable in India.

6
Mr. Bharat Kumar Manghnani, Jaipur.

 Out of the total addition, the ld. CIT (A) rightly observed that the opening balance of FDRs was Rs. 2,22,00,063, which was fully explained from the bank certificate placed on page no. 16 of paper book.
 The remaining amount of Rs. 1,44,00,000 was also found to be sourced from foreign remittances to the NRE account, duly corroborated with bank records.

Ground No. 1.4 Addition u/s 69A Unexplained Money

 As regards the bank balance of Rs. 35,31,094/-, the assessee has satisfactorily explained that this balance represented maturity proceeds of FDRs and inward remittances in the NRE account. (ICICI bank certificate is proof of same submitted before AO as well as CIT (A).
Ground No. 1.5 : Addition u/s 69A Unexplained Money

 The addition of Rs. 76,845/- made by the AO represents a withdrawal from the NRE account, which is merely a movement of funds and cannot be treated as income under any interpretation of the law.

Ground No. 1.5 Addition u/s 69A Unexplained Money

 Even the interest earned on NRE deposits, which is exempt under section 10(4)(ii), was wrongly added by the AO. The ld. CIT (A) has rightly deleted this addition.

Conclusion:

In light of the above, the order passed by the ld. CIT (A) is based on proper appreciation of facts and evidence, and in accordance with the settled legal principles. There is no infirmity in the order that calls for interference by the Hon’ble Bench.

We respectfully pray that the appeal filed by the Department be dismissed.”

S.No.
Particulars
Page No.
1. Withdrawn Application
1
2. Proof of Evidences Submitted before the learned Assessing Officer (AO)
2-4
3. Reply Filed before the Assessing Officer
5

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Mr. Bharat Kumar Manghnani, Jaipur.

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Mr. Bharat Kumar Manghnani, Jaipur.

proceedings, the ld. CIT (A) while adjudicating the issue, taking into consideration the details supported by documentary evidences furnished by the ld. A/R of the assessee, discussed the matter at great length and accordingly deleted the additions.

Now, we adjudicate the grounds as under :-
The ground nos. 1.1 and 1.2 raised by the revenue relate to admission of additional evidence under Rule 46A and opportunity to examine the evidence.
6.1
In this regard, on perusal of the record, we find that initially the assessee had filed an application under Rule 46A for admission of additional evidence. Later on, the ld. A/R of the assessee vide letter dated 27.03.2025 has voluntarily withdrawn the application for admission of additional evidence well before disposal of the appeal by the ld. CIT (A). A copy of the withdrawal application is placed on record
(PB Page 1). From the perusal of the first appellate order, we find that the ld. CIT
(A) has neither admitted any additional evidence nor denied opportunity to examine the evidence. We, therefore, find no merit in the ground nos. 1.1 and 1.2
raised by the revenue. The same are dismissed.

Ground no. 1.3 relates to deletion of addition of Rs. 3,66,00,063/- made under section 69 on account of Time Deposit in bank account.

9
Mr. Bharat Kumar Manghnani, Jaipur.

are the foreign remittances to the NRE account of the assessee which also duly corroborated with SBI bank records submitted by the assessee. The ld. CIT (A) while deleting this addition, has dealt with the matter in para 8.1 to 9 of his order as under :-
“ 8.1
It has been stated by the appellant in his written submissions that he is a Non-
Resident Individual aged about 72 years, and that he has been staying outside India, i.e. in Nigeria, since last 40 years. It has been further stated that the assessee did not earn any income from any source in India, which was more than the maximum amount, nor chargeable to tax in India. Accordingly, assessee did not file his return of income in India.
During the year under consideration, assessee earned, minimal income in India, in the form of Interest income from NRO Account. The said interest income, for the year under consideration was also Rs. 1,052. Assessee did not have any other source of Income in India, which is evident from Form 26AS of the assessee.

// screen shot at page 15 of CIT(A)’s order to be reproduced //

Date of remittance
Amount (in Rs.)
10.04.2017
2887347
02.05.2017
594375

10
Mr. Bharat Kumar Manghnani, Jaipur.

Assessee has clarified that during the year under consideration, he has remitted total amount of Rs. 2,05,00,690/- as against Rs. 2,45,88,548/- as specified in the earlier submission. Therefore, the total remittance received is amounting to Rs. 2,05,00,690/- during the financial year 2017-18. Assessee has submitted copy of bank statement of SBI bearing NRE Account no. 10402227750 in which amount of remittance was clearly reflected in the bank account statement. From this NRE Account no. 10402227750, assessee has purchased fresh STDR amounting to Rs. 1,44,00,000/- during the financial year 2017-18 whereas old STDR amounting to Rs. 2,22,00,063/- were renewed during the financial year 2017-18. The appellant has stated that he had renewed existing fixed deposits that were originally created in earlier years i.e. Fixed Deposit prior to 23.02.2012, amounting to Rs. 2,22,00,063. The assessee has submitted a detailed chart showing the fixed deposits which were made after renewal of his old FDRs, the chart showing the maturity amount of new FDRs is reproduced as under :-

S.
No.
Fixed
Deposit
Account
Number
Fixed Deposit Amount
Renewed during the Year under consideration (Rs.)

1
10402271903
26,28,521
2
10402271914
23,22,161
3
10402271925
5,81,402
4
10402271936
5,05,384
5
10402271958
20,55,066
6
30099463879
4,99,228
7
30387068421
37,22,283
8
30532834948
43,74,787
9
30532835668
9,84,794
10
30835752517
8,65,412
11
32065203055
21,16,603
12
34714307871
15,44,422

TOTAL
2,22,00,063

11
Mr. Bharat Kumar Manghnani, Jaipur.

In support of the above tabulated chart assessee has furnished copy of bank statement along with fixed deposits statements from 2012 which shows the maturity amount of each
FDRs. On perusal from the bank statement and fixed deposit statements it is evident that the fixed deposits were created in preceding years and not during the year under consideration i.e. financial year 2017-18. The amounts for these fixed deposits were remitted by the assessee from the bank outside India to his bank account in India in earlier years. Subsequently, these fixed deposits were created, and during the year under consideration, they were renewed. In support of his claim appellant has submitted copy of bank statement along with fix deposit account statement to prove his contention. The appellant has also submitted a copy of certificate received from State Bank of India in which the bank also certified the facts as mentioned the assessee. The relevant screen shot of the is mentioned as below :-

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Mr. Bharat Kumar Manghnani, Jaipur.

13
Mr. Bharat Kumar Manghnani, Jaipur.

in Nigeria. Accordingly, whatever amount was infused into the bank account in India, the source of same was the bank account outside India, and the origin of such income was salary earned while working outside India. The salary certificate issued by the employer of the assessee M/s. Beekays Design and Publishing Co. Ltd. in Nigeria has been reproduced above.

In the totality of facts and taking into consideration the detailed discussion made by the ld. CIT (A) reproduced hereinabove, we are of the considered view that the ld. CIT (A) has rightly deleted the addition of Rs. 3,66,00,063/- made by the AO. We do not find any infirmity in the order of the ld. CIT (A), which is hereby upheld. Ground no. 1.3 of the revenue is dismissed.

Ground no. 1.4 to 1.6 relate to deletion of addition of Rs. 35,31,094/- (Rs.
34,53,197/- + Rs. 76,845/- and Rs. 1,052/-) made under section 69A as unexplained a/c balance in the Bank account, source of interest income earned and source of foreign remittance received respectively.

NRE account which is merely a movement of funds and cannot be treated as income under any interpretation of the law. As regards the amount of Rs. 1,052/-, it was submitted that this is the interest amount earned by the assessee on NRE deposits, which is exempt under section 10(4)(ii) of the IT Act, 1961. The ld. CIT
(A) while deleting this addition, has dealt with the matter in para 10.1 & 10.2 of his order as under :-
“ 10.1
During the course of appellate proceedings, it was stated by the appellant that he was working in Nigeria since last 40 years. With regard to the addition of amount of Rs.
34,53,197/- made by the AO on account of account balance of the assessee in the ICICI
Bank, the appellant has stated that an amount of Rs. 22,53,263/- was remitted from SBI
NRE A/c to the ICICI Bank on 15.02.2017 from which FD bearing Account no.
001201072365 was created whose maturity value was Rs. 24,02,040/-. The assessee has further stated that on 31.12.2017 the account balance in ICICI Bank NRE account no.
001201072365 was Rs. 10,39,600/-. Further, it has been stated that the account balance of the ICICI Bank NRO account was Rs. 11,545/-. In support of his claim appellant has submitted a certificate issued by the ICICI bank which is reproduced as under :-

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Mr. Bharat Kumar Manghnani, Jaipur.

Further, in respect of addition of Rs. 76,845/-, it is submitted by the appellant that a non-resident can make withdrawals or otherwise use funds lying in his NRE

16
Mr. Bharat Kumar Manghnani, Jaipur.

A/c. Thus, the amount of Rs. 76,845/- cannot be taxed under the provisions of Income Tax Act, 1961. Furthermore, addition of Rs. 1,052/- is in fact, the interest earned from NRO A/c and the same is not taxable in India, as the total income of the assessee is less than Rs. 2,50,000/- in India for the year under consideration.

Thus, it is manifest from the documentary evidences filed by the assessee that the assessee has clearly explained account balance of Rs. 34,53,197/- in his bank account with ICICI Bank, interest earned of Rs. 76,845/- from his bank account with ICICI Bank and the source of foreign remittance received of Rs. 1,052/-.
6.4
In the totality of facts and taking into consideration the detailed discussion made by the ld. CIT (A) reproduced hereinabove, we are of the considered view that the ld. CIT (A) has rightly deleted the addition of Rs. 35,31,094/- (Rs.
34,53,197/- + Rs. 76,845/- and Rs. 1,052/-) made by the AO. We do not find any 17
Mr. Bharat Kumar Manghnani, Jaipur.

infirmity in the order of the ld. CIT (A), which is hereby upheld. Ground no. 1.4 to 1.6 of the revenue are dismissed.

In the result, appeal of the revenue is dismissed.

Order pronounced in the open court on 29/09/2025. ¼ xxu xks;y ½

¼MkWa-,l-lhrky{eh½
(GAGAM GOYAL)

(Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member

Tk;iqj@Jaipur fnukad@Dated:- 29/09/2025
*Santosh
आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू
1. The Appellant- DCIT, Circle (International Taxation), Jaipur.
2. izR;FkhZ@ The Respondent- Mr. Bharat Kumar Manghnani, Jaipur.

सहायक पंजीकार@Aेेजज. त्महपेजतंत