Bliss Dealtrade Private Limited Vs ITO (ITAT Kolkata)
leged transactions with National Spot Exchange Limited (NSEL) was unsustainable where the assessee’s NSEL account had been opened after the relevant financial year.
The Tribunal found that the account was opened on 24.05.2012, whereas the disputed assessment concerned financial year 2011-12, ending on 31.03.2012. The supporting bank statement also showed no transactions and an unchanged balance matching the audited financial statements.
Accordingly, the Tribunal directed deletion of the ₹37,14,150 addition under Section 68 and allowed the assessee’s appeal.
Background of the Reassessment
The assessee, Bliss Dealtrade Private Limited, filed its return on 22.08.2012, declaring nil total income. The return was processed under Section 143(1) of the Income Tax Act, 1961.
Subsequently, information concerning alleged NSEL-related transactions reached the tax authorities through the investigation offices in Mumbai and Kolkata.
The Assessing Officer proceeded on the basis that an amount of ₹37,14,150 related to financial year 2011-12 and had not been disclosed in the return for assessment year 2012-13.
Considering this amount to represent escaped income, the Assessing Officer issued a notice under Section 148 on 30.03.2019. The assessee requested that its original return be treated as the return furnished in response.
Addition Made Under Section 68
During reassessment, the Assessing Officer sought documentary evidence regarding the disputed transaction.
The assessment order recorded that the assessee had failed to produce the required evidence concerning ₹37,14,150. The amount was consequently added to total income under Section 68.
The assessment was completed under Sections 147 and 143(3) on 13.12.2019.
The assessee challenged both the reassessment proceedings and the addition. Its grounds included objections to the jurisdiction of the officers issuing notices and the factual basis of the alleged NSEL transactions.
The decisive issue before the Tribunal, however, concerned whether such transactions could have occurred during the relevant financial year.
Documents Furnished Before CIT(A)
Before the first appellate authority, the assessee submitted that it maintained only one bank account during the relevant year, with Bank of India, Mission Row Branch, and that the disputed receipt was not credited there.
It furnished the bank statement, audited financial statements, additional banking documents and a copy of the NSEL party master.
The party master showed that the NSEL account was opened on 24.05.2012, falling in financial year 2012-13, relevant to assessment year 2013-14.
Despite these submissions, the CIT(A) upheld the addition. The appellate order treated the explanation as insufficient and recorded that a bank credit had not been explained.
The assessee appealed against the CIT(A)’s order dated 10.12.2025.
Assessee Challenges the Factual Foundation
Before the Tribunal, the assessee filed a 65-page paper book, certifying that the documents had already been furnished before the authorities below.
Its representative argued that the CIT(A) had rejected the explanation without properly examining the evidence.
Particular reliance was placed on the party master, the bank statement and the audited balance sheet. The assessee submitted that these records disproved the alleged transactions during financial year 2011-12.
The bank statement reflected a balance of ₹4,840, corresponding with the amount disclosed in the audited financial statements.
The assessee therefore contended that the information underlying the reopening was incorrect and that no income from the alleged transactions had escaped assessment for the year concerned.
Revenue Supports the Reassessment
The Revenue relied on the orders of the Assessing Officer and the CIT(A).
Its representative submitted that the reopening followed information received from the investigation authorities regarding NSEL transactions of ₹37,14,150.
The Revenue also maintained that the Assessing Officer had followed the prescribed procedure for reopening and issuing the Section 148 notice.
The Tribunal nevertheless examined whether the information was consistent with the documentary evidence relating to the relevant year.
Tribunal Finds No Transactions Before 31.03.2012
The Tribunal found that the NSEL party master clearly recorded 24.05.2012 as the account-opening date.
It also examined the Bank of India statement and found no transactions, with identical opening and closing balances of ₹4,840. This figure tallied with the audited financial statements.
The Revenue could not controvert these documents or the assessee’s objection. The Tribunal specifically noted that the evidence had also been furnished during the first appellate proceedings.
On this basis, it held that there were no transactions with NSEL before 31.03.2012, since the account itself was opened subsequently.
Final Decision
The Tribunal held that the reopening on this factual basis was not sustainable and directed the Assessing Officer to delete the ₹37,14,150 addition.
The appeal was allowed.
The decision rests on the documentary mismatch between the alleged transaction year and the account-opening date, supported by bank records and audited statements that the Revenue could not rebut.
FULL TEXT OF THE ORIGINAL JUDGMENT/ORDER
This is an Appeal filed by the Assessee against the order of the Commissioner of Income Tax (Appeal), Addl/JCIT (A), Panaji [“the Ld. CIT(A)”, for short], dated 10.12.2025 with DIN & Order No. ITBA/ALP/S/250/2025-26/1083509560(1), passed u/s 250 of the Income Tax Act, 1961 (“the Act”, for short) for the Assessment Year 2012-13, arising out of the Assessment order dated 13.12.2019 passed u/s 147/143(3) of the Act on the following Grounds of Appeal:-
“1. For that the notices issued u/s 148 and 143(2) of the Income Tax Act, 1961 (“Act”) by the Ld. Assistant Commissioner of Income Tax Circle-1(1), International Taxation, Kolkata is bad in law being without jurisdiction.
2. For that the notices issued u/s 148 and 143(2) of the Act by the Ld. Assistant Commissioner of Income Tax Circle-1(1), International Taxation, Kolkata is also bad in law being without jurisdiction considering the returned income of the assessee company.
3. For that the assessment made by the Ld. ITO, Ward 9(2), Kolkata without himself issuing notice u/s 143(2) is bad in law.
4. The reassessment proceedings are invalid as the ‘reason to believe’ is based on information from the Director of Income Tax (Investigation), Mumbai, which is vague, indefinite, and does not establish a direct nexus to escaped income for A.Y. 2012-13. The assumption that as receivable outstanding in F.Y. 2013-14 must constitute undisclosed income from F.Y. 2011-12 is speculative, far-fetched, and lacks any tangible basis, rendering the initiation legally unsustainable.
5. For that even otherwise, the assessee company had no transaction with NSEL during the FY 2011-12, therefore the reasons recorded as factually incorrect in as much as non est that vitiates the entire reassessment proceedings.
6. For that in fact the assessee was registered with NSEL as constituent on 24.05.2012, therefore question of doing any transaction with NSEL in the FY 2011-12 did not arise.
7. For that the Ld. CIT(A) erred in confirming the addition of Rs.37,14,150/- as unexplained cash credit despite the assessee stating that it has no transaction with NSEL during the year and submitted copy of its bank statements and P[arty Master with NSEL showing its registration with NSEL on 24.05.2012 i.e. FY 2012-13 (AY 2013-14).
8. For that under the facts and circumstances of the case, the reassessment proceeding is unsustainable in the eyes of law and the addition made by the Ld. Assessing Officer needs to be deleted.
9. For that the appellant craves leave to add, alter or withdraw any ground (s) of appeal on or before hearing of the appeal.”
2. Briefly stated, the facts of the case are that the assessee filed a return of income on 22.08.2012, showing total income of Rs. 0/-, and the return was processed u/s 143(1) of the Act. As per the information received from the Office of the DIT (I&CI), Mumbai, through the Office of the Principal CCIT, WB & Sikkim, Kolkata, the receivable outstanding during F.Y. 2011-12, amounting to Rs. 37,14,150/-, was received in the Amilnald Mercantile Banking Ltd. As per the information of the Principal DIT Investigation-2, Mumbai, the transactions relate to F.Y. 2011-12. As per the return for A.Y. 2012-13, no income with regard to this transaction has been shown, and the due amount of Rs. 37,14,150/- was not disclosed. It appears that the assessee has suppressed its income and has further not shown profit from the transaction with NSEL in its return. Hence, the income of Rs. 37,14,150/- is chargeable to tax as escaped income. Accordingly, notice u/s 148 of the Act was issued to the assessee on 30.03.2019. In response to the notice, the assessee furnished a reply stating that the return filed u/s 139 of the Act may be treated as a return in response to the notice u/s 148 of the Act. Subsequently, other statutory notices were issued to the assessee. The assessee furnished a reply, and, on examination of the documents, it was found that the assessee failed to produce the documentary evidence as required during the course of assessment proceedings. The assessee furnished a reply, and it was found that the assessee failed to produce the documentary evidence as required during the course of assessment proceedings in regard to the transaction of Rs. 37,14,150/-. The assessment was completed, and the same amount was disallowed and added back to the total income of the assessee u/s 68 of the Act.
3. Aggrieved by the order, the assessee filed an appeal before the Ld. CIT(A), raising various grounds. During the course of appellate proceedings, notice was given to the assessee at the registered email ID, and the assessee complied with the notices, submitted documentary evidence in support of its contention, and submitted that, in A.Y. 2012-13, the assessee had maintained only one bank account with Bank of India, Mission Row Branch. No such receipt was credited therein. In compliance, a copy of the bank statement was annexed. Further, a copy of Tamil Nadu Mercantile Bank Limited and a copy of the audited financial report were furnished. It was further submitted that the NSEL account was opened only on 24.05.2012, and a copy of the “party master” was enclosed. The assessee also relied on various judgments. The complete details of the submission were incorporated by the Ld. CIT(A), who noted that the appellant had not discharged anything on the test. A mere claim that the transaction did not belong to it was not accepted without supporting evidence. It was found from the bank statement that it showed a credit, but no explanation was provided for the entry. Relying on various judgments, the Ld. CIT(A) upheld the order of the Assessing Officer and dismissed the appeal of the assessee. Against the order of the Ld. CIT(A), the assessee filed an appeal before this Tribunal.
4. The Learned Counsel reiterated the submissions made before the lower authorities and filed a paper book containing pages 1 to 65, with certification that the documents had been furnished to the Assessing Officer and the Ld. CIT(A). The Learned Counsel submitted that all the documents were furnished before the Ld. CIT(A) to prove that, in the impugned assessment year, there were no transactions with the said parties, as observed by the DIT Investigation. The Ld. CIT(A) summarily rejected the submission of the assessee without examining the documents furnished by the assessee. The Ld. AR referred to Page No. 32 of the paper book, wherein the bank balance is placed. The Ld. AR also referred to Page No. 36, wherein the closing balance of the bank account of Rs. 4,840/- is appearing in the balance sheet at Page No. 32. The Ld. AR also referred to Page No. 37, which is a copy of the party master, wherein it is clearly mentioned that the account was opened on 24.05.2012. The Ld. Counsel strongly objected that the information received was completely wrong and that the case of the assessee was reopened without application of mind and without examining the facts of the case. Accordingly, the notice issued u/s 148 of the Act and the reasons recorded were completely wrong. Therefore, the addition made by the Assessing Officer was wrong. There was no escapement of income for the impugned assessment year.
5. On the other hand, the Ld. DR relied on the orders of the lower authorities and submitted that the Assessing Officer reopened the case on the basis of information received from the DIT (Inv.), Mumbai, who passed the information to the DIT, Kolkata, that the assessee had transactions with NSEL of Rs. 37,14,150/-. After following the due procedure to reopen the case, the notice was issued u/s 148 of the Act, and the assessment was completed.
6. Considering the rival submissions and perusing the entire materials available on record, and examining the orders of the authorities below, I noted that the case of the assessee was reopened as per the investigation report and information received from the Office of the DIT (Inv.), Mumbai, through the Office of the Principal CCIT, West Bengal and Sikkim, Kolkata, after following the due procedure to reopen the case. However, I further noted from the submissions made before the Ld. CIT(A) that the assessee furnished documents, and the same documents were produced before me, wherein it is clearly mentioned that the account with National Spot Exchange Limited (NSEL) was opened on 24.05.2012, which is clear from the party master placed at Page No. 37 of the Paper Book. As per the bank statement placed at Page No. 36 of the Paper Book, there were no transactions noted. The opening and closing balances shown in the said Bank of India bank statement for Account Number 401420110000978 are the same, at Rs. 4,840/-, and this is tallies with the audited financial statement. The Ld. DR could not controvert the above objection or the documents furnished by the assessee’s counsel, which were also furnished during the course of the first appellate proceedings. Accordingly, I hold that, before 31.03.2012, there were no transactions with NSEL, since the account was opened on 24.05.2012. Accordingly, the reopening made by the Assessing Officer on this point is not sustainable, and the Assessing Officer is directed to delete the addition.
7. In the result, the appeal of the assessee is allowed.
Order pronounced on 21.10.2026.
