Anurodh Sahu Vs ITO (ITAT Jabalpur)
NRI’s Crypto Transactions Alleged at ₹1.31 Cr — Tribunal Says ‘Confront Evidence First’- ITAT Holds AO Cannot Add Unexplained Investment Without Sharing Exchange Records
Assessee, an NRI serving on a foreign vessel, did not file ROI for AY 2018-19. Based on information from Koinex crypto exchange alleging purchases of ₹1,31,31,481 & sales of ₹1,28,58,585, reassessment was initiated u/s 147. Assessee stated that crypto transactions were only to the extent of ₹11 lakhs, entirely routed through his SBI NRO account; further asserted that Koinex app had shut down, hence no transaction statements could be retrieved. AO, relying solely on Koinex-sourced figures, treated ₹1,20,31,481 as unexplained investment u/s 69 while allowing capital loss of ₹2,72,896.
Before DRP, Assessee denied the alleged volume of trading & filed an affidavit. DRP nevertheless sustained the addition citing Sumati Dayal & Durga Prasad More. Assessee appealed.
Tribunal observed that once Assessee denied the alleged transactions & furnished his bank accounts, burden shifted to Department to confront him with the exact Koinex transaction data forming basis of addition. Since no such details were ever shared, principles of natural justice were violated. ITAT held that AO must first provide complete Koinex-based records & then pass a fresh order after considering Assessee’s response.
