Sunita Bhardwaj Vs ITO (ITAT Delhi)
Bank Deposits & Notional Rent Can’t Be Estimated Blindly: Delhi ITAT Orders Extensive Remand in Multi-Year Case
Delhi ITAT ‘G’ Bench in Sunita Bhardwaj Vs. ITO [ITA Nos. 1431/Del/2024 (AY 2016-17), 1430/Del/2024 (AY 2017-18) & 1429/Del/2024 (AY 2018-19), order dated 31.12.2025] partly allowed Assessee’s appeals holding that additions made on presumptions and estimates could not be sustained without proper verification. Tribunal upheld validity of reassessment for AY 2016-17 to AY 2018-19, holding that approval u/s 151 by Addl. CIT was valid as reopening was within four years under pre-amended law.
On merits, Tribunal found that additions of substantial bank deposits u/s 69A were made without examining Assessee’s consistent explanation that deposits represented earlier cash withdrawals, third-party accounts and loans duly supported by bank statements and sanction letters. Matter was restored to AO for fresh verification with direction to allow telescoping wherever applicable.
With respect to notional rental income from multiple properties, Tribunal held that properties used for professional purposes or already sold could not be subjected to notional rent and that rent already offered to tax could not be re-assessed. For remaining properties, AO was directed to compute annual value based on municipal circle rates and not on ad-hoc fair market value, following CIT Vs. Moni Kumar Subba (Delhi HC). Additions on LTCG were also remanded for verification of cost of acquisition and improvement. Appeals for all three years were thus partly allowed for statistical purposes with comprehensive remand directions
FULL TEXT OF THE ORDER OF ITAT DELHI
