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Facts
The assessee, a salaried employee, declared income of Rs. 6,75,700/-. Information revealed an investment of Rs. 1,05,35,029/- in digital currency, leading to reopening of the assessment under Section 147/148. The Assessing Officer (AO) made an addition of Rs. 99,35,029/- under Section 69, determining the income at Rs. 1,06,10,728/-.
Held
The Tribunal, considering the assessee's request for another opportunity and the need for justice, decided to remit the issue back to the AO for fresh consideration. The assessee is directed to provide cogent documentary evidence for the investments.
Key Issues
Whether the assessee sufficiently substantiated the source of investment in digital currency, and if natural justice was violated by the lower authorities.
Sections Cited
147, 148, 69, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “CUTTACK BENCH, CUTTACK
O R D E R
PER LAXMI PRASAD SAHU, ACCOUNTANT MEMBER
This is an appeal filed by the assessee against the order passed u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereafter “the Ld. CIT(A)] dated 15.10.2025, DIN & order No. ITBA/APL/S/250/2025-26/1081766616(1) on the following grounds:
“1. The order under section 250 of the Act dated 15-10-2025, issued by the Learned CIT(A), National Faceless Appeal Centre, is erroneous, contrary to the facts of the case, and liable to be set aside.
Balaram Giri 2. The assessment order under section 147 read with section 144B of the Act dated 22-03-2023, issued by the Leamed AO, National Faceless Assessment Centre, is erroneous, contrary to the facts of the case, and liable to be set aside.
3. The Learned AO has issued the subject assessment order in violation to principles of natural justice, without providing sufficient opportunities to produce necessary documents: 4. The Leamed CTT(A) has issued the order in violation to principles of natural justice, and without considering the submissions made by the Appellant 5. The Learned CIT(A) erred in upholding the erroneous additions made by the Leamed AO in the assessment order.
6. Without prejudice, the Learned AO and the Learned CIT(A) failed to appreciate the nature of transactions entered into by the Appellant.
7. The Learned AO and the Learned CIT(A) failed to appreciate the source of investment m digital currency transactions during the subject AY 8 The Appellant craves leave to add, alter, amend, or delete any of these grounds before or during the appeal hearing.”
Briefly stated the facts of the case are that the assessee filed return of income on 28.08.2018 declaring total income at Rs. 6,75,700/- under the head ‘income from salary’. As per the information available with the department, the assessee had invested Rs. 1,05,35,029/- in digital currency during the Financial Year 2017-18. Therefore, the case was reopened u/s 147/148 of the Act after following the due procedure as per section 147 to 151 of the Act. During the course of reassessment proceedings, the assessee furnished the part reply, from the informations submitted, the AO observed that the investment made by the assessee are not commensurate with the income declared by the assessee in his return of income of Rs. 6,75,700/-. On the basis of documents available, the AO made addition of Rs. 99,35,029/- under the special provision of section 69 of the Act and income was determined at Rs. 1,06,10,728/-.
Aggrieved from the above order, the assessee filed appeal before the Ld. CIT(A).
The Ld. Counsel reiterated the submissions made before the lower authorities and submitted that the investments were made out of loan
Balaram Giri taken from the Axis Bank of Rs. 6,00,000/- invested the same for buying and selling of the crypto currency, copy of details were filed before the revenue authorities have not properly appreciated on the same and further requested, undertook that if one more chance be given to the assessee, the assessee establish the source of investment with documentary evidences.
On the other hand, the Ld. DR relied on the orders of lower authorities and submitted that the ample opportunities were granted to the assessee but the assessee is unable to substantiate the source of investment.
During the rival submissions, the assessee is a salaried employee and has invested in digital currency for Rs. 1,05,35,029/- and filed detailed of Rs. 65,24,889/- as per the CIT(A) order. Considering the facts of the case, request made by the assessee counsel and in the interests of justice, we are remitting this issue back to the file of AO for denovo consideration and decide the issue as per law after giving reasonable opportunity of being heard to the assessee . The assessee is directed to substantiate his case with cogent documents in support of his claim and not seek unnecessary adjournments for early disposal of the case. In case of failure, no second leniency shall be granted to the assessee.
In the result, appeal of the assessee is partly allowed for statistical purposes.
Order pronounced on 09.02.2026