Bharat Bhushan Vs ITO (ITAT Delhi)
Delhi ITAT Remands Reassessment Where Assessee Claimed PAN and Identity Were Fraudulently Misused to Operate Bank Accounts
The Delhi ITAT set aside the reassessment and remanded the matter to the Assessing Officer after the assessee claimed that his PAN and identity had been fraudulently misused to operate multiple bank accounts. Observing that both the assessment and first appellate orders were passed ex parte without proper examination of the facts, the Tribunal directed a fresh assessment after verifying the assessee’s claim.
The assessee sought condonation of delay in filing the appeal, explaining that he became aware of the NFAC order only on 13.01.2026. He contended that no physical order had been served upon him and that his PAN and personal documents had been fraudulently used by another person to undertake the impugned transactions. Accepting the explanation, the Tribunal condoned the delay and admitted the appeal.
The Assessing Officer had reopened the assessment under section 147 and made an ex parte addition of ₹33.77 crore under section 69A, treating cash deposits and other bank transactions as unexplained money. The NFAC partly allowed the appeal by holding that cash withdrawals could not be taxed under section 69A, restricting the addition to ₹27.39 crore, being the unexplained cash deposits.
Before the Tribunal, the assessee filed an affidavit asserting that one Shri Manish Kumar Kwatra had fraudulently used his identity and PAN to open and operate the bank accounts. The Tribunal observed that the authorities below had passed their orders without any effective participation from the assessee and, consequently, the factual issues regarding the ownership of the bank accounts had never been properly investigated.
Accordingly, the ITAT set aside the CIT(A)’s order and restored the matter to the Assessing Officer for a fresh assessment, directing the assessee to extend full cooperation and the Assessing Officer to verify the claim regarding the true ownership of the bank accounts by exercising his statutory powers. Both the assessee’s and the Revenue’s appeals were treated as partly allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT DELHI
