Dilipbhai Ranchhodbhai Patel Vs ITO (ITAT Ahmedabad)
Capital Introduced in Firm Not Automatically Unexplained Income: ITAT Deletes Entire Section 69A Addition
The Ahmedabad ITAT deleted the entire addition made under Section 69A in respect of capital introduced by the assessee into a partnership firm, holding that once the assessee had furnished confirmations, bank statements and source details of the lenders, the addition could not survive merely on suspicion.
The Assessing Officer had treated ₹29 lakh introduced as capital in the partnership firm as unexplained money and framed an ex parte assessment. Though the CIT(A) granted partial relief, sustaining ₹15 lakh, the Tribunal found that the documentary evidences relating to the loans had been ignored. The Tribunal noted that one of the loans was repaid within five months, another was received through a transport proprietorship concern with supporting evidence, and complete details including confirmations and bank statements were available for the remaining lender as well. Accordingly, the Tribunal held that no addition was warranted and allowed the assessee’s appeal in full.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
The captioned appeal has been filed by the assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (in short “NFAC”), Delhi order dated 09.12.2025 relevant to Assessment Year 2020-21.
