KAILASH CHAND MAHESHWARI,JAIPUR vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, , JAIPUR

ITA 1465/JPR/2024Status: DisposedITAT Jaipur20 May 2025AY 2017-18108 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal decided the appeals on merits, rendering the challenge to the assessment orders under Section 144/153A as academic. Regarding the addition of Rs.94,77,000/- (AY 2015-16) and Rs.54,90,000/- (AY 2016-17) under Section 68 for cash deposits, the Tribunal's decision is not fully detailed in the provided text, but it is implied that some part of these additions were disputed and addressed. The addition of Rs.2,00,000/- for agricultural income was confirmed for AY 2015-16 and AY 2016-17, and also for AY 2017-18, as the assessee failed to provide supporting evidence. The Tribunal addressed additions under Section 69C for interest on cash loans and Section 69 for unexplained investment in land, and Section 69A for undisclosed brokerage/profit, with specific findings not fully elaborated but leading to a partly allowed outcome. The disallowance of interest expenditure under Section 57(iii) was also addressed. The addition for marriage expenses was confirmed for AY 2015-16. The applicability of Section 115BBE was considered for AY 2016-17 and AY 2017-18, with the judgment implying it was not applied in a manner that led to dismissal. The overall outcome for all three appeals was that they were partly allowed. The ratio decidendi is that the assessee must provide sufficient evidence to substantiate claims of income or expenditure, and failure to do so can lead to additions by the AO and confirmation by appellate authorities.

What were the facts?

The assessee, Kailash Chand Maheshwari, filed three appeals before the Income Tax Appellate Tribunal (ITAT), Jaipur Bench, challenging the orders of the Commissioner of Income Tax (Appeals) for assessment years 2015-16, 2016-17, and 2017-18. These orders confirmed the assessment orders passed by the DCIT, Central Circle-02, Jaipur, under Section 144 read with Section 153A and Section 143(3) read with Section 153A of the Income Tax Act, 1961. The assessments were based on a search and seizure action conducted on the Chandra Prakash Agarwal Group, to which the assessee belongs. The assessee filed returns in response to notices under Section 153A, but no undisclosed income was declared for the relevant years. The Assessing Officer (AO) completed the assessments to the best of his judgment due to the assessee's non-cooperation.

What were the issues?

The Tribunal had to decide the following questions: 1. Whether the CIT(A) erred in confirming the AO's action of passing assessment orders under Section 144/153A, rendering them void ab initio. 2. Whether the CIT(A) erred in confirming the addition of Rs.94,77,000/- (AY 2015-16) and Rs.54,90,000/- (AY 2016-17) under Section 68 as unexplained cash credits, despite the assessee's submission that the deposits were from earlier withdrawals and regular income. 3. Whether the CIT(A) erred in confirming the addition of Rs.2,00,000/- under Section 68 by not accepting the assessee's claimed agricultural income. 4. Whether the CIT(A) erred in confirming the addition of Rs.87,84,862/- (AY 2015-16) and Rs.1,00,53,088/- (AY 2016-17) under Section 69C as unexplained expenditure on interest paid on alleged cash loans. 5. Whether the CIT(A) erred in confirming the addition of Rs.51,22,569/- (AY 2015-16) under Section 69C as unexplained expenditure on interest paid on alleged cash loans. 6. Whether the CIT(A) erred in confirming the addition of Rs.1,00,00,000/- (AY 2015-16) under Section 68 based on post-dated cheques found from a third party. 7. Whether the CIT(A) erred in confirming the addition of Rs.5,47,150/- (AY 2015-16) and Rs.6,60,066/- (AY 2016-17) under Section 57(iii) by disallowing interest expenditure. 8. Whether the CIT(A) erred in confirming the addition of Rs.17,02,666/- (AY 2015-16) on account of undisclosed brokerage income. 9. Whether the CIT(A) erred in confirming the addition of Rs.10,00,000/- (AY 2015-16) for marriage expenses without material evidence. 10. Whether the CIT(A) erred in confirming the addition of Rs.3,68,00,000/- (AY 2016-17) under Section 69 as unexplained investment in land. 11. Whether the CIT(A) erred in confirming the addition of Rs.28,00,000/- (AY 2016-17) under Section 69C for unexplained expenditure on marriage. 12. Whether the AO erred in applying Section 115BBE (AY 2016-17 & 2017-18). 13. Whether the CIT(A) erred in confirming the addition of Rs.4,75,00,000/- (AY 2017-18) under Section 69A as undisclosed brokerage/profit. Assessee's Contentions: The assessee argued that the assessment orders under Section 144/153A were void ab initio. For additions under Section 68, the assessee claimed the cash deposits were from earlier withdrawals and regular income. Agricultural income was claimed to be genuine. For Section 69C additions, the assessee contended it was on account of interest paid on cash loans. The disallowance of interest expenditure under Section 57(iii) was challenged. The addition for marriage expenses was claimed to be without material evidence. The applicability of Section 115BBE was disputed. Revenue's Contentions: The judgment does not explicitly record the revenue's contentions on each ground. However, the AO's actions, confirmed by the CIT(A), indicate the revenue's position that the cash deposits, agricultural income, interest payments, investments, and other expenditures were unexplained and constituted undisclosed income.

Which sections of the Income-tax Act were involved?

Section 144,Section 153A,Section 143(3),Section 68,Section 69C,Section 57(iii),Section 69,Section 69A,Section 115BBE,Section 132,Section 133A,Section 127,Section 139(1),Section 143(2),Section 142(1),Section 132(4)

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Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR

Before: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI,

For Appellant: Shri S. L. Poddar, Adv
For Respondent: Shri Rajesh Ojha, CIT-DR
Hearing: 11/03/2025Pronounced: 20/05/2025

PER: RATHOD KAMLESH JAYANTBHAI, AM These three appeals are filed by the assessee aggrieved from the order of Commissioner of Income Tax (Appeal), Jaipur-4 [ for short CIT(A)] for the assessment years 2015-16 & 2016-17 dated 20.11.2024 for A. Y. 2017-18 dated 27.11.2024. That order was passed by ld. CIT(A) because the assessee challenged the order of assessment all dated 14.12.2018 passed u/s.144

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