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Judgment
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
This is a batch of two appeals of the same assessee. Both these appeals are reportedly delayed by 61 days (as per the ITAT Registry). The assessee has filed identically worded condonation petitions in both the cases. For the sake of convenience, the petition in ITA No.1076 (AY 2017-18) is extracted as under:
Date: 22.01.2026 The Registrar Hon'ble Income Tax Appellate Tribunal, New Delhi Sub: APPLICATION FOR CONDONATION OF DELAY IN FILING APPEAL AGAINST ORDER PASSED U/S 250 R.W.S. 147 OF THE INCOME-TAX ACT, 1961 FOR ASSESSMENT YEAR 2017-18 IN THE CASE OF SMT MUKESH GUPTA -AFCPG7890R Sir, In connection with the above, the Appellant, most respectfully, submits as under-
1.That the order dated 24.09.2025 passed u/s 250 r.ws. 147 of the Income-tax Act 1961 by the Ld. Commissioner of Income Tax (Appeals), NFAC was served upon the Appellant on 24.09.2025.
2.That the appeal against the same was due to be filed before Hon'ble Income Tax Appellate Tribunal, New Delhi in accordance with the provisions of the Income-tax Act, 1961 on or before 23.11.2025.
3.That the appeal against the afore said order is being filed late whereas the same was due to be filed on 23.11.2025 resulting in a delay of 60 days.
4.That the reason for not filing the appeal is on account of illness and severe health issues of the Spouse of Appellant.
5.After recovery from illness of her spouse, the Appellant contacted his Counsel, got the appeal prepared, paid filing fees, signed the appeal papers and deposited the appeal immediately thereafter. An affidavit narrating and affirming these facts is enclosed.
6.Consequently, he was prevented by sufficient cause for not filing the appeal within the statutory time and the same occurred only because of the ill health of the Spouse of Appellant.
7.That Your Honour is empowered u/s 249(3) of the Act to condone delay in filing appeal.
PRAYER
8.In the circumstances it is respectfully prayed that the delay in filing the appeal may very kindly be condoned and the appeal be kindly admitted for adjudication.
Thanking you, Yours faithfully, Sd/-(MUKESH GUPTA)
Considering the reasons given in the said petition, the delay in both the appeals is hereby condoned and the appeals are admitted for adjudication.
The Appeal for AY 2017-18 arises from order dated 24.09.2025, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by Ld. CIT(A)-NFAC, Delhi. The Appeal for AY 2018-19 arises from order dated 24.09.2025, passed u/s 250 of the Act, by NFAC, Delhi. In both these appeals the issues are similar and hence these matters are being disposed of through a single order.
For the sake of convenience the appeal for AY 2018-19 is being taken as the lead case. The assessee was found to have entered into a transaction with one M/s Shri Renuka Mata Multi State Urban Cooperative Credit Society Limited. There was an allegation that the assessee was involved in providing bogus entries for purchases and sales. The Ld. AO disbelieved the claim of the assessee that he was a commission agent who was routinely depositing and withdrawing cash from the said bank account on behalf of others. Thereafter, the Ld. AO added the total credit amount in the said bank account totaling to Rs.78,07,167/- u/s 69A of the Act.
Aggrieved with this action, the assessee approached the Ld. CIT(A) where also he could not succeed mainly on the ground that there was no representation before the first appellate authority.
Further aggrieved, the assessee has approached the ITAT with grounds which challenge the proceedings initiated through notice u/s 148 of the Act and has also challenged the addition on merit.
Before us the Ld. AR filed a calculation of peak balance for both the years and requested that since the bank accounts showed continuous deposits and withdrawals by the assessee, hence, it would be fair and proper to add the peak balances only. For the sake of capturing the details of deposits and withdrawals the calculation sheets filed by the Ld. AR deserve to be extracted as under: -
Sh. Mukesh Gupta
ITA No. 1076/Del/2026
AY 2017-18
Calculation of Peak Balance
(Period 01.04.2016 to 31.03.2017)
Date of Deposit Amount Deposited Withdrawal amount Balance Opening balance 3,61,172 3,61,172 03.04.2016 3,60,000 1,172 04.04.2016 30,000 31,172 04.04.2016 60,000 91,172 06.04.2016 70,000 21,172 09.04.2016 75,000 96,172 09.04.2016 1,00,000 1,96,172 09.04.2016 1,00,000 2,95,000 1,172 11.04.2016 1,41,800 1,42,972 12.04.2016 50,000 1,92,972 13.04.2016 1,90,000 2,972 15.04.2016 43,000 45,972 16.04.2016 1,80,000 2,25,972 16.04.2016 20,000 2,45,972 20.04.2016 3,00,000 5,45,972 21.04.2016 49,820 5,95,792 22.04.2016 20,000 6,15,792 24.04.2016 1,93,000 4,22,792 25.04.2016 99,500 4,80,000 42,292 26.04.2016 1,00,000 1,42,292 26.04.2016 2,00,000 3,42,292 27.04.2016 3,39,000 3,292 28.04.2016 25,000 28,292 29.04.2016 35,000 63,292 29.04.2016 20,000 83,292 03.05.2016 68,300 1,51,592 05.05.2016 41,730 1,93,322 06.05.2016 1,90,000 3,322 07.05.2016 34,000 37,322 07.05.2016 50,000 87,322 11.05.2016 40,000 1,80,000 -52,678 11.05.2016 60,000 7,322 14.05.2016 59,910 67,232 14.05.2016 63,000 4,232 16.05.2016 24,000 28,232 16.05.2016 52,340 80,572 16.05.2016 59,800 1,40,372 17.05.2016 30,000 1,70,372 17.05.2016 16,500 1,86,872 19.05.2016 50,000 2,36,872 20.05.2016 2,70,000 5,06,872 24.05.2016 5,00,000 6,872 25.05.2016 41,500 48,372 26.05.2016 1,70,000 2,18,372 27.05.2016 57,840 2,76,212
28.05.2016 75,000 3,51,212 28.05.2016 1,00,000 4,51,212 29.05.2016 2,80,000 1,71,212 30.05.2016 40,000 2,11,212 30.05.2016 23,000 2,34,212 30.05.2016 1,60,160 74,052 31.05.2016 50,000 1,24,052 01.06.2016 53,900 1,70,000 7,952 03.06.2016 1,00,000 1,07,952 06.06.2016 40,000 1,47,952 09.06.2016 48,750 1,96,702 14.06.2016 1,90,000 6,702 18.06.2016 10,000 16,702 23.06.2016 43,090 59,792 28.06.2016 40,000 99,792 29.06.2016 48,311 1,48,103 29.06.2016 42,000 1,90,103 30.06.2016 58,000 2,48,103 01.07.2016 25,000 2,73,103 01.07.2016 20,000 2,93,103 05.07.2016 2,85,000 8,103 08.07.2016 45,000 53,103 08.07.2016 20,000 73,103 11.07.2016 66,000 7,103 14.07.2016 1,00,000 1,07,103 14.07.2016 50,000 1,57,103 15.07.2016 1,50,000 7,103 21.07.2016 1,60,200 1,67,303 22.07.2016 95,000 2,62,303 25.07.2016 1,30,000 1,32,303 25.07.2016 1,24,124 8,179 26.07.2016 50,000 58,179 27.07.2016 20,000 78,179 27.07.2016 60,000 1,38,179 30.07.2016 1,30,000 8,179 05.08.2016 62,000 70,179 13.08.2016 13,000 83,179 18.08.2016 50,000 1,33,179 23.08.2016 4,80,000 6,13,179 25.08.2016 2,00,000 5,10,000 3,03,179 25.08.2016 92,092 2,11,087 26.08.2016 67,200 2,78,287 26.08.2016 32,800 3,11,087 27.08.2016 3,00,000 11,087 30.08.2016 1,50,000 1,61,087 03.09.2016 30,000 1,80,000 11,087 06.09.2016 1,25,000 1,36,087 07.09.2016 50,000 1,86,087 08.09.2016 1,75,000 11,087 12.09.2016 1,80,000 1,91,087 14.09.2016 60,000 2,51,087 14.09.2016 40,000 2,91,087
24.01.2017 42,423 50,341 24.01.2017 34,000 16,341 28.01.2017 40,000 56,341 01.02.2017 1,00,000 1,56,341 04.02.2017 1,40,000 16,341 06.02.2017 50,000 66,341 07.02.2017 18,972 85,313 10.02.2017 2,37,630 3,22,943 11.02.2017 1,50,000 1,72,943 13.02.2017 1,50,000 22,943 14.02.2017 1,00,600 1,23,543 16.02.2017 1,00,000 2,23,543 16.02.2016 2,00,000 23,543 18.02.2017 50,000 73,543 18.02.2017 99,500 1,73,043 20.02.2017 1,00,000 2,73,043 20.02.2017 10,140 2,83,183 20.02.2017 34,600 3,17,783 21.02.2017 2,45,000 72,783 21.02.2017 1,13,914 -41,131 21.02.2017 59,910 18,779 22.02.2017 1,00,000 1,18,779 27.02.2017 1,00,000 18,779 28.02.2017 1,00,000 1,18,779 01.03.2017 90,000 1,00,000 1,08,779 01.03.2017 1,00,000 2,08,779 02.03.2017 1,90,000 18,779 02.03.2017 14,036 32,815 03.03.2017 24,000 56,815 04.03.2017 80,000 1,36,815 06.03.2017 65,000 2,01,815 07.03.2017 40,000 1,84,000 57,815 08.03.2017 57,000 1,14,815 08.03.2017 14,370 1,29,185 09.03.2017 40,000 1,69,185 10.03.2017 1,50,000 19,185 15.03.2017 23,270 42,455 16.03.2017 43,800 86,255 18.03.2017 50,000 1,36,255 22.03.2017 50,000 1,86,255 22.03.2017 3,50,000 5,36,255 22.03.2017 35,770 5,72,025 23.03.2017 24,675 6,00,000 -3,300 23.03.2017 64,980 61,680 27.03.2017 22,232 83,912 29.03.2017 80,000 1,63,912 30.03.2017 15,660 1,48,252 31.03.2017 1,00,000 2,48,252 Total 1,31,89,533 1,33,02,453 Sh. Mukesh Gupta
ITA No. 1077/Del/2026
AY 2018-19
Calculation of Peak Balance
(Period 01.04.2017 to 31.03.2018)
Date of Deposit Amount Deposited Withdrawal amount Balance Opening Balance 2,29,078 2,29,078 03.04.2017 50,000 2,79,078 03.04.2017 8,760 2,87,838 03.04.2017 50,000 3,37,838 05.04.2017 3,00,000 6,37,838 05.04.2017 33,200 6,71,038 05.04.2017 4,80,000 1,91,038 07.04.2017 1,90,000 1,038 07.04.2017 51,975 53,013 10.04.2017 14,365 67,378 11.04.2017 20,000 87,378 13.04.2017 51,310 1,38,688 15.04.2017 1,37,000 1,688 16.04.2017 14,466 16,154 20.04.2017 1,85,000 2,01,154 24.04.2017 24,000 2,25,154 25.04.2017 35,500 2,00,000 60,654 25.04.2017 2,03,925 2,64,579 26.04.2017 1,00,000 2,23,000 1,41,579 26.04.2017 1,00,000 2,41,579 27.04.2017 2,39,600 1,979 03.05.2017 4,00,000 4,01,979 05.05.2017 1,00,000 5,01,979 05.05.2017 4,50,000 51,979 12.05.2017 1,60,900 2,12,879 15.05.2017 1,00,000 3,12,879 17.05.2017 3,10,000 2,879 22.05.2017 1,00,000 1,02,879 24.05.2017 30,000 1,32,879 24.05.2017 1,00,000 2,32,879 26.05.2017 66,900 2,99,779 26.05.2017 1,00,000 3,99,779 29.05.2017 60,000 4,59,779 29.05.2017 40,000 4,99,779 30.05.2017 1,00,000 3,99,779 30.05.2017 2,91,137 1,08,642 31.05.2017 30,000 1,38,642 31.05.2017 1,30,900 2,69,542 01.06.2017 65,000 3,34,542 02.06.2017 2,21,800 5,56,342 02.06.2017 60,000 6,16,342 02.06.2017 70,000 6,86,342 03.06.2017 30,000 7,16,342 03.06.2017 6,80,000 36,342 10.06.2017 50,000 86,342
14.06.2017 50,000 1,36,342 15.06.2017 1,30,000 6,342 17.06.2017 30,000 36,342 20.06.2017 98,000 1,34,342 21.06.2017 90,000 2,24,342 22.06.2017 12,000 2,36,342 23.06.2017 5,00,000 7,36,342 23.06.2017 1,00,000 8,36,342 23.06.2017 50,000 8,86,342 23.06.2017 40,000 9,26,342 24.06.2017 2,25,000 11,51,342 25.06.2017 50,000 12,01,342 27.06.2017 1,20,000 13,21,342 27.06.2017 9,00,000 4,21,342 27.06.2017 3,00,000 1,21,342 28.06.2017 1,14,000 7,342 29.06.2017 40,000 47,342 07.07.2017 11,646 58,988 10.07.2017 2,50,000 3,08,988 10.07.2017 2,99,780 9,208 12.07.2017 7,795 17,003 17.07.2017 19,640 36,643 20.07.2017 19,750 56,393 21.07.2017 50,000 1,06,393 25.07.2017 90,000 1,96,393 27.07.2017 16,560 2,12,953 29.07.2017 30,000 2,42,953 29.07.2017 2,32,232 10,721 29.07.2017 20,000 30,721 03.08.2017 1,00,000 1,30,721 05.08.2017 20,000 1,50,721 05.08.2017 1,00,000 2,50,721 10.08.2017 50,000 3,00,721 10.08.2017 50,000 3,50,721 11.08.2017 2,40,000 1,10,721 17.08.2017 1,00,100 10,621 24.08.2017 1,00,000 1,10,621 28.08.2017 35,000 1,45,621 28.08.2017 1,35,286 10,335 05.09.2017 61,320 71,655 07.09.2017 48,750 1,20,405 12.09.2017 1,10,000 10,405 28.09.2017 1,03,400 1,13,805 03.10.2017 9,400 1,23,205 05.10.2017 1,15,115 8,090 07.10.2017 1,00,000 1,08,090 11.10.2017 80,000 28,090 30.10.2017 15,100 43,190 30.10.2017 5,00,000 5,43,190 01.11.2017 5,00,000 10,43,190 01.11.2017 1,00,000 11,43,190 03.11.2017 9,50,000 1,93,190
The Ld. AR explained that for AY 2017-18 the peak balance was on 5.11.2016 at Rs.6,43,228/-. Similarly for AY 2018-19 the peak balance was on 27.06.2017 at Rs.13,21,342/-. It was the submission that if at all any addition has to be made then it is only these amounts which should justifiably be considered for the same.
The ld. DR supported the orders of authorities below and stated that the assessee should have appeared before the Ld. CIT(A) and proved the deposits and withdrawals so that the impugned additions could have been justifiably addressed.
We have carefully considered the submissions of Ld. AR/DR. We have also perused the documents before us. It is a settled position in accounts that in case where there are running deposits and withdrawals, which have not been explained to the satisfaction of the Ld. AO then the most fair and just approach is to not only consider the deposits but to also consider the withdrawals in a holistic manner. The calculation of peak values in such cases rules out the possibility of excessive additions without considering the fact that deposits could also be from earlier withdrawals made. Accordingly, we set aside the impugned order and remand this matter back to the file of Ld. AO with the direction that the peak balance filed before us and extracted in the body of this order, deserves to be cross verified with the entries in the bank account and thereafter only the peak balance needs to be added in the hands of the assessee.
This decision shall apply mutatis mutandis to AY 2018-19 as well.
In the result, both these appeals are partly allowed.