Krishna Priya Parvathaneni Vs ITO (ITAT Visakhapatnam)
Summary: The assessee filed her return for AY 2017-18 declaring income of ₹7.71 lakh, while the assessment under Section 143(3) determined total income at ₹23.90 lakh after additions towards unexplained money under Section 69A and long-term capital gains. Although the assessee had challenged the additions before the lower authorities, before the Tribunal she confined her arguments to the application of the enhanced 60% tax rate under Section 115BBE to the unexplained-money addition. Relying on the decision of the Rajasthan High Court in Deepak Maratha v. Pr. CIT-II, Jodhpur, Civil Writ Petition No. 3625/2020 dated 27.05.2026, the Visakhapatnam ITAT noted that the amendment to Section 115BBE enhancing the rate of tax came into force from 01.04.2017, i.e. from FY 2017-18, and therefore the rate of 60% could apply only from AY 2018-19 onwards. Since the assessment year involved was AY 2017-18, the Tribunal held that the applicable rate under Section 115BBE was 30% and directed the Assessing Officer to compute tax at 30% on the addition made towards unexplained money under Section 69A. The appeal was accordingly partly allowed.
Enhanced 60% Tax Rate Under Section 115BBE Inapplicable to AY 2017-18; Visakhapatnam ITAT Directs Taxation at 30%
The assessee filed her return for AY 2017-18 declaring income of ₹7.71 lakh. The AO completed the assessment under Section 143(3) at ₹23.90 lakh after adding ₹14.09 lakh as unexplained money under Section 69A and ₹2.10 lakh as long-term capital gains. The CIT(A) upheld both additions.
Before the Tribunal, the assessee did not press her challenge to the additions and confined her arguments to the application of the enhanced 60% tax rate under Section 115BBE to the unexplained-money addition.
The Visakhapatnam ITAT, following the Rajasthan High Court ruling in Deepak Maratha v. Pr. CIT, held that the Finance Act, 2016 amendment enhancing the Section 115BBE rate from 30% to 60% came into force on 1 April 2017. Therefore, the enhanced rate applied only from FY 2017-18, corresponding to AY 2018-19, and could not be applied retrospectively to FY 2016-17 relevant to AY 2017-18.
Accordingly, the Tribunal directed the AO to levy tax at 30%, instead of 60%, on the addition made under Section 69A. The appeal was partly allowed.
List of Cases Discussed / Relied Upon
- Deepak Maratha v. Pr. CIT- II, Jodhpur,Civil Writ Petition No. 3625/2020, dated 27.05.2026 — relied upon for the proposition that the amendment to Section 115BBE enhancing the tax rate to 60% came into force from 01.04.2017 and therefore did not apply to FY 2016-17 relevant to AY 2017-18.
FULL TEXT OF THE ORDER OF ITAT VISAKHAPATNAM
This appeal is filed by the Assessee against the order Learned Commissioner of Income Tax (Appeals)/ Ld.ADDL/JCIT(A)-2, Lucknow [hereinafter in short “Ld. CIT(A)”] vide DIN: ITBA/APL/S/250/2025 -26/1086964867(1) dated 06-Mar-2026 for the Assessment Year 2017-18.
