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Facts
The assessee appealed against the CIT(A)/NFAC's orders upholding additions made under section 69A r.w.s. 115BBE, treating alleged cash loans as unexplained money. The Revenue contended these additions were based on information about cash loans advanced by the assessee.
Held
The Tribunal found no merit in the Revenue's stance. The Tribunal observed a development agreement predating the assessment years, and that the sum in question was more akin to damages awardable to the assessee.
Key Issues
Whether cash loans treated as unexplained money were validly added, considering the existence of a development agreement and the nature of the sum as potential damages.
Sections Cited
147, 144, 69A, 115BBE
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Income Tax Appellate Tribunal, DELHI BENCH: ‘E NEW DELHI
Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL
ORDER PER SATBEER SINGH GODARA, JM These assessee’s three appeals 3277 & 3278/Del/2025 for assessment years 2014-15, 2016-17 and 2017- 18, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s orders, all dated 25.03.2025 having DINs and orders no. ITBA/NFAC/S/250/2024-25/1074998233(1), ITBA/NFAC/S/250/2024-25/1074998436(1) and ITBA/NFAC/S/250/2024-25/1074998662(1) involving proceedings under section 147 r.w.s. 144 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), respectively. Heard both the parties. Case files perused.
It transpires during the course of hearing that the assessee’s identical sole substantive ground raised
1. in the instant three appeals seeks to reverse both the learned lower authorities’ action treating his alleged cash loans of Rs.25.40 lakhs each, as unexplained money under section 69A r.w.s. 115BBE of the Act in the instant as many assessments as upheld in the lower appellate discussion.
1. 3. The Revenue’s case in this factual backdrop is that the learned lower authorities’ have made the impugned addition based on the corresponding information about the assessee having advanced the impugned alleged cash loans to one Sh. Naresh Chand Juneja which deserves to be upheld against him in all these three cases.
4. We find no merit in the Revenue’s stand seeking to confirm the impugned identical addition. This is for the precise reason that going by the learned criminal court’s proceedings involving section 2 | P a g e 138 of the Negotiable Instruments Act (pages 36 to 38), we notice that there was a development agreement between the assessee and the developers concerned which involved the impugned amount in question going by the letter dated 18.08.2012 admittedly not falling in any of the three assessment years 2014-15, 2016-17 and 2017- 18 herein. This clinching factual position has gone unrebutted from the Revenue side. This is indeed coupled with yet another fact that the impugned sum was more in the nature of damages as awardable to the assessee in case of non-fulfillment of the development agreement than cash loans advanced. We thus conclude in this factual backdrop that both the learned lower authorities’ respective findings adding the impugned cash loans as well as the interest accrued/arising thereupon deserve to be deleted. We order accordingly.