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Judgment
PER KRINWANT SAHAY, AM:
Appeal in this case has been filed by the revenue against the order dated 12.12.2025 passed by the ld. CIT(A) NFAC, Delhi for Assessment Year: 2017-18.
Grounds of appeal taken by the revenue are as under:
“1.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding that the assessment order passed u/s 143(3) is vitiated due to alleged violation of principles of natural justice, ignoring the fact that sufficient statutory opportunities were provided to the assessee during assessment proceedings. Ground of Appeal
2.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 89,98,000 /- made u/s 68 of the Income-tax Act on account of unexplained cash deposits during demonetization period, without appreciating that the assessee failed to discharge the primary onus of proving the nature and source of such deposits with cogent evidence.
3.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) wrongly accepted that the cash deposits were from business receipts without properly verifying the facts and without considering that the pattern of cash deposits was unusual compared to earlier years' business activity.
4.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of Rs. 29,16,919/- on account of commission expenses made u/s 37 of the Act, ignoring the failure of the assessee to substantiate the genuineness of services rendered, identity of recipients and business expediency of the expenditure.
5.On the facts and in the circumstances of the case and in law, the CIT(A) erred in deleting the addition of Rs. 1,30,30,761/- made u/s 69C of the Act on account of unexplained investment in property, without calling for a remand report and without verifying the claim that the amount represented an opening balance pertaining to earlier years.
6.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of Rs. 31,25,127/- on account of interest expenditure, ignoring that the assessee failed to establish the nexus between borrowed funds and business purposes with supporting evidence.
7.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the consequential levy of tax under section 115BBE and interest charged under sections 234A, 234B, 234C and 234D, without appreciating that the same are mandatory and consequential in nature.
8.The appellant craves leave to add, amend, alter or withdraw any ground of appeal at the time of hearing.”
During proceedings before us, the ld. DR argued that despite the fact that adequate opportunities were given to the assessee during assessment proceedings but the assessee did not file all relevant documents and details. During the appellate proceedings, the assessee filed additional evidence which was accepted by the ld. CIT(A) without getting remand report from the AO. Accordingly, the ld. DR argued that the additions deleted by the ld. CIT(A) should be rejected.
Per contra, the ld. counsel of the assessee relied on the order of the ld. CIT(A).
We have considered the findings given by the authorities below and we find that the additional evidence filed by the assessee has been accepted by the ld. CIT(A) without getting any remand report from the AO. We have also considered the case law filed by the revenue in the case of CIT, Central-1 v. Manish Buildwell Pvt. Ltd. [2011] 16 taxmann.com 27 (Delhi) passed by the Hon’ble jurisdictional High Court, Delhi. In this case law, it has been clearly held by the jurisdictional High Court that where additional evidences was admitted and accepted as genuine at first appellate stage without Assessing Officer furnishing his comments and without verification, required under Rule 46A(3) were not satisfied and therefore order of Commissioner of Income Tax (Appeals) could not be sustained.
Keeping in view, the case law in the case of Manish Buildwell (supra). We are of this considered view that the order passed by the ld. CIT(A) cannot be sustained. Accordingly, we remand this case back to the file of the AO for de-novo assessment after giving adequate opportunity to the assessee. The assessee is also directed to file all relevant details and papers before the AO in time.
In the result, the appeal filed by the revenue is allowed for statistical purposes.