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Judgment
Per Renu Jauhri, Accountant Member:
This appeal by the assessee is directed against the order dated 16/09/2025 of the Ld. Commissioner of Income Tax, (Appeal)-3, ARTO Complex, 2nd floor, Sector-33, Noida, [hereinafter referred to as the ‘Ld. CIT(A)] arising out of the Order dated 26.03.2024 passed under section 153C r.w.s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by Deputy Commissioner of Income Tax, Central Circle, Meerut, (hereinafter referred to as the ‘AO’) pertaining to Assessment Year (A.Y.) 2019-20.
The Assessee has raised the following grounds of appeal:
“ 1. That the Ld. CIT(A) has erred in law and facts of the case in confirming the addition of Rs.2,57,115/-, only on the basis of the books of M/s World Window Impex Group, without considering the submissions made by the appellant in right perspective.
2.That the Ld. CIT(A) has erred in law and facts of the case in confirming the addition of Rs.2,57,115/- made by the Ld. A.O. u/s 68 of the Act, u/s 69A of the Act, as the same cannot be treated as unexplained credit or undisclosed investment in the hands of the appellant.
3.That the appellant respectfully craves leave to add alter omit or substitute any or all of the above grounds of appeal at any time before or at the time of hearing of appeal to enable your good self to decide the appeal in accordance with law.”
Brief facts are that the assessee is a private limited company engaged in the business of manufacturing of M.S. Ingots and M.S. Runner Risers. The assessee filed its ITR for the relevant year on 27.09.2019, declaring nil income and paid taxes under MAT. A search and seizure operation was carried out on the premises of M/s World Window Group on 25.06.2018, wherein some parallel cash book and trial balance was found titled as 'Overseas Commission 04-05' wherein a credit balance of Rs.2,57,115/-, was outstanding in the name of the assessee. On the basis of the said information, a notice u/s 153C of the Act, was issued to the assessee on 25.09.2023. In response to the said notice, the assessee filed its ITR declaring the earlier shown 'Nil' income on 08.11.2023. During the course of the assessment proceedings, the assessee submitted that it had not undertaken any transaction with M/s World Window Group, after 31.03.2013 i.e. after FY 2012-13 and is not aware as to how and why this amount of Rs. 2,57,115/- was outstanding to its credit in the alleged parallel books found during the course of search. The proceedings u/s 153C/143(3) of the Act, were completed vide order dated 26.03.2024 wherein the A.O. made addition of Rs.2,57,115/- holding that the same represented unaccounted income of the assessee.
Aggrieved, the assessee preferred an appeal before the CIT(A), who dismissed the same vide order dated 16.09.2025. Further aggrieved, the assessee is in appeal before the Tribunal.
Before us, Ld. AR has argued that the Ld. CIT(A) was not justified in confirming the addition of Rs. 2,75,115/- made by the AO u/s 68 of the Act, by invoking section 292C to hold that the amount represented the unexplained investment u/s 69A (instead of section 68) of the Act. The addition was made solely on the basis of some trial balance found during the search conducted on M/s World Window Group. The assessee had submitted before the AO that no transaction was undertaken with the searched group after 31.03.2013. A copy of M/s World Window Impex Ltd.’s ledger account for F.Y. 2012-13 in assessee’s books of account was also filed before the lower authorities as per which the assessee had made certain transactions during that year with the searched group. Thereafter, no financial transaction was undertaken by the assessee and it is not understood how an opening balance of Rs. 2,57,115/- as on 1.4.2018 had been shown against the assessee’s name in the trial balance. Further, from the seized documents, it is not clear as to in which year the impugned transaction had taken place. There is no other detail or document made available to the assessee and, therefore, assessee cannot be expected to explain the alleged transaction. Ld. AR has further argued that in the absence of details such as the date of transaction, manner/mode of receipt/ payment etc., the impugned amount cannot be treated as unexplained cash credit or investment merely on the basis of a dumb document found during the course of search conducted on a third party.
On the other hand, Ld. DR has strongly relied on the orders of the lower authorities and has contended that the impugned amount has been found recorded in the seized document which is a trial balance and not any random scribblings which could be disregarded as a dumb document. He has further justified the action of the CIT(A) in invoking the provision of section 292B to confirm the addition u/s 69A of the Act as unexplained investment instead of section 68 of the Act applied by the AO.
We have heard the rival submissions and perused the material available on record. We note that besides the sole entry in the seized document, there are no other details or documentary evidence regarding the nature and date of the alleged transaction undertaken by the assessee with the searched entity during the year under consideration. Even if it is taken as the correct opening balance as on 1.4.2018, there is no justification to add this amount in the year under consideration without ascertaining the nature and actual date of the transaction.
In view of above factual matrix, we are of the considered view that in the absence of relevant details regarding date and nature of the alleged transaction, there is no justification for the AO to make the impugned additions in the hands of the assessee. Accordingly, the addition of Rs. 2,57,411/- made u/s 68 of the Act, by the AO and confirmed by the CIT(A) u/s 69A of the Act is hereby directed to be deleted.
In the result, appeal of the assessee is allowed.