DCIT, CENTRAL CIRCLE-1, GUWAHATI, GUWAHATI vs. RAMSWARUP BAJAJ, ASSAM

PDF · subscribers
ITA 113/GTY/2023Status: DisposedITAT Guwahati09 February 2026AY 2018-196 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the order of the CIT(A) on both issues. Regarding the unsecured loans, the Tribunal noted that the CIT(A) had categorically recorded that while the AO arrived at a correct conclusion that the unsecured loans availed by M/s Kishlay Snacks Products were from bogus parties, the AO failed to take the correct action by making the corresponding addition in the hands of M/s Kishlay Snacks Products, who had availed these loans. The Tribunal found that the Revenue had not been able to dislodge these specific findings of fact recorded by the CIT(A), which were substantially drawn from the assessment order itself. Therefore, no reason was found to interfere with the CIT(A)'s deletion of the addition. Concerning the share purchase, the Tribunal found that the CIT(A) had extracted details from the assessment order and correctly concluded that the shares were allotted in 2014, purchased in 2017, and sold in 2017, clearly relating to AY 2017-18, not the impugned AY 2018-19. As the Revenue could not point out how these transactions relating to AY 2017-18 could be assessed in AY 2018-19, the CIT(A)'s findings were upheld.

What were the facts?

The Revenue is in appeal against the order of the CIT(A) for Assessment Year 2018-19. The CIT(A) had deleted an addition of ₹98,96,517/- made by the Assessing Officer (AO) on account of bogus unsecured loans. The Revenue contended that the addition was made based on incriminating materials found during a search, and the assessee had admitted that the money belonged to him. The CIT(A) had held that the loans were availed by M/s Kishlay Snacks Products and not the assessee, and the AO failed to make the addition in the hands of the firm. The appeal also concerns the deletion of an addition of ₹1,86,50,000/- made on account of purchase of shares. The Revenue argued that the assessee admitted to transactions with shell companies. The CIT(A) deleted this addition, finding that the transactions related to Assessment Year 2017-18.

What were the issues?

1. Whether, on the facts and in law, the CIT(A) erred in deleting the addition of ₹98,96,517/- on account of bogus unsecured loans, which was made under Section 69A of the Income Tax Act, 1961, for AY 2018-19, when the assessee himself had disclosed additional income. - Assessee's contention: The monies belong to the firm M/s Kishlay Snacks Products, and the addition should have been considered in the hands of the firm, not the assessee. The CIT(A) correctly noted that no enquiry was conducted by the AO with the loan parties and that the AO ought to have considered these transactions in the hands of M/s Kishlay Snack Products under Section 68. - Revenue's contention: The assessee admitted that the money belonged to him. The CIT(A) considered fresh evidence and erred in concluding that the amounts related to M/s Kishlay Snacks Products. The AO's addition should be restored. 2. Whether, on the facts and in law, the CIT(A) erred in deleting the addition of ₹1,86,50,000/- made on account of purchase of shares for AY 2018-19. - Assessee's contention: These transactions relate to earlier assessment years, specifically AY 2017-18, and not AY 2018-19, which is the ground on which the CIT(A) deleted the addition. - Revenue's contention: The assessee admitted to partial transactions with shell companies, and despite these findings, the CIT(A) deleted the addition. The AO's order should be restored.

Which sections of the Income-tax Act were involved?

Section 69A,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, GUWAHATI BENCH, GUWAHATI

Before: SHRI GEORGE MATHAN, JM & SHRI LAXMI PRASAD SAHU, AM

For Appellant: Shri Rohit Kapoor
For Respondent: Shri Santosh Kumar Karnani, DR
Hearing: 09.02.2026Pronounced: 09.02.2026

This is an appeal filed by the Revenue against the order of the Commissioner of Income-tax (Appeals), Central, North-East Region, Guwahati (hereinafter referred to as the “Ld. CIT(A)”] in appeal no. CIT (A), Central NER, Guwahati/100060/2017-18 dated 07.06.2023 for the AY 2018-19.

2.

Shri Rohit Kappor & Virsain Aggarwal, represented on behalf of the assessee and Shri Santosh Kumar Karnani, Sr. DR represented on behalf of the Revenue.

3.

The Revenue has raised following grounds of appeal:-

5. The first issue in regard to an addition of ₹98,96,517/- deleted by the ld. CIT (A) representing bogus unsecured loans.

5.1. It was a submission that no detail has been produced by the assessee before the ld. AO and the ld. CIT (A) has considered fresh evidence. It was a submission that the ld. CIT (A) came to a conclusion that the amounts related to the firm M/s Kishlay Snacks Products and not the assessee. It was a submission that in the course of search on the assessee and assessee has admitted that the money belongs to him. It was a submission that the addition as made by the AO and as deleted by the ld. CIT (A) may be reversed and the order of the AO restored on this issue.

5.2. In reply, the Learned AR drew our attention to page 67 and 68 and 69 of the ld. CIT (A), wherein in paragraph 3 to 5 the ld. CIT (A) has held as follows:-

“3. That, no enquiry seems to have been conducted by the Investigation wing (i.e. during the course of post search investigation) or by the AO (i.e. during the course of the assessment proceedings) with any of the party whose name was appearing in the aforesaid incriminating material as to the genuineness of the unsecured loans availed by 5.4. We have considered the rival contentions . A perusal of the facts of the present case clearly shows that in paragraph 9 at pages 68 and 69, towards the end of the paragraph, the Learned CIT (A), after considering the facts, has categorically recorded that ‘even though the assessing officer has arrived at a correct conclusion, but he has failed to take the correct action on this correct conclusion, having held that the unsecured loans availed by M/s Kishlay Snacks Products were from bogus Jama Karchi parties, it was incumbent on the AO to have made the corresponding addition in this regard, in the hands of the person M/s Kishlay Snacks Products, who had availed these bogus unsecured loans’. Here, we would draw attention to the fact that the order of the ld. CIT (A) dated 7th June, 2023, the impugned assessment year i.e.

6.

The second issue raised in the appeal is against the action of the Learned CIT (A) in deleting the addition of ₹1,86,50,000 made on account of purchase of shares for the A.Y. 2018-19.

6.1. It was a submission that the Learned CIT (A) has deleted the addition without considering the facts in its correct perspective. The Learned Senior D.R. drew our attention to pages 80, 81 and 82 of the Order of the Learned CIT (A) to submit that the assessee in the course of the search had admitted to disclose partial transactions in so far as the assessee admitted that the transactions were with shell companies. It was a submission that even after these findings, the Learned CIT (A) has deleted the addition. It was a prayer that the Order of the Learned CIT (A) may be reversed and that of the AO restored. The Learned DR also drew our attention to pages 3 and 4 of the assessment order to submit that the AO has specifically brought out that these are Jama Karchi transactions and that the assessee had admitted to surrender of the amounts.

6.3. We have considered the rival contentions . A perusal of the Order of the Learned CIT (A) shows that the Learned CIT (A) has extracted details from the assessment order and has come to the conclusion that these shares were allotted by the company M/s Kishlay Foods Private Limited on 31st March, 2014. These shares were purchased on 1st February, 2017 and thereafter, had been sold on 15th March, 2017. Thus, clearly the transaction relates to the A.Y. 2017-18. The impugned A.Y. 2018-19. The revenue has not been able to point out how these transactions which relate to the A.Y. 2017-18, could be assessed in the impugned assessment year being 2018-19. As the revenue has not been able to dislodge these primary findings of facts by the ld. CIT (A), we find no error in the order of the Learned CIT (A), which calls interference on this issue. Consequently, the findings of the Learned CIT (A) on this issue stands upheld.

7.

In the result, appeal of the revenue stands dismissed.

Order pronounced in the open court on 09.02.2026.

More judgments on Section 69A

All 15,297 judgments and leading authorities on Section 69A →

Recent GST High Court judgments

Search GST case law →