ITAT Patna Judgments — October 2026

The Tribunal condoned the 613-day delay in filing the appeal, finding that the assessee had a "reasonable cause" due to lack of proper legal guidance, difficulties in arranging professional assistance and relevant records, and a bona fide belief that compliance was completed at the appellate stage. On the merits, the Tribunal upheld the order of the CIT(A). The assessee's counsel could not controvert the CIT(A)'s finding that the net profit should be estimated at 5% of the turnover. The Tribunal noted that the assessee had deposited cash during demonetization, did not file a return, and although they later submitted documents proving business activities, no evidentiary documents for claimed expenditures were furnished. The CIT(A) had rightly estimated the income at 5% on the turnover achieved by the assessee, considering the nature of FMCG trading. Therefore, the appeal of the assessee was dismissed.

The Tribunal noted that the assessee was unrepresented and had not filed an adjournment petition. The Tribunal observed that the Assessing Officer had made additions under Sections 69, 69A, and 56(2)(x), resulting in an assessed income of Rs. 1,20,33,199/-. It was also noted that the assessee had failed to represent their case before the CIT(A). Considering the facts and in the interest of justice, the Tribunal decided to remit the issue back to the file of the CIT(A) for fresh consideration and decision. The assessee was directed to substantiate their case with cogent documents and avoid seeking unnecessary adjournments. The Tribunal stated that no further leniency would be granted if the assessee failed to comply. The appeal was allowed for statistical purposes.

The Tribunal upheld the order of the CIT(A) and dismissed the Revenue's appeal. The Tribunal found that the CIT(A)'s order was well-reasoned. The addition made by the AO was based on a confidential report and incomplete/unauthenticated documents, which were not provided to the assessee despite repeated requests, thus denying a fair opportunity to present their case. The Tribunal noted that the alleged cash receipts were never found in the assessee's possession, and the presumption under Section 132(4A) read with Section 292C would not apply. Furthermore, the Tribunal observed that the department had accepted that there was no material to corroborate the alleged cash payments and that the investigation wing affirmed that such receipts were not available with them. The Tribunal also noted that the Xerox copies relied upon were uncorroborated, inconsistently signed, and unreliable. The Tribunal further emphasized the principle of consistency, stating that the department cannot take contradictory stands on the same facts. The Tribunal concluded that the transactions referred to by the department were either loans that were repaid or for share subscription, thus demolishing the department's stand that these were part of undisclosed consideration. Consequently, the appeal of the Revenue was dismissed.

The Tribunal upheld the order of the CIT(A) and dismissed the Revenue's appeal. The Tribunal found that the CIT(A)'s order was well-reasoned. The addition made by the AO was based on a confidential report and incomplete/unauthenticated documents, which were not provided to the assessee despite repeated requests, thus denying a fair opportunity to present their case. The Tribunal noted that the alleged cash receipts were never found in the assessee's possession, and the presumption under Section 132(4A) read with Section 292C would not apply. Furthermore, the Tribunal observed that the department had accepted that there was no material to corroborate the alleged cash payments and that the investigation wing affirmed that such receipts were not available with them. The Tribunal also noted that the Xerox copies relied upon were uncorroborated, inconsistently signed, and unreliable. The Tribunal further emphasized the principle of consistency, stating that the department cannot take contradictory stands on the same facts. The Tribunal concluded that the transactions referred to by the department were either loans that were repaid or for share subscription, thus demolishing the department's stand that these were part of undisclosed consideration. Consequently, the appeal of the Revenue was dismissed.