Ashish Kalra Vs ACIT (ITAT Delhi)
ITAT DELHI deletes addition of alleged cash receipts – no evidence, contradictions in statements, earlier year accepted- Loose Papers & “Kalra Ji” Not Enough! ITAT Quashes ₹1.20 Cr Cash Receipt Addition & Even Deletes ₹5 Lakh Enhancement
Assessee was a faculty member teaching CA students for Bright Professional Pvt. Ltd. A search took place in Bright Group & loose papers (Annexure A-29 & A-30) allegedly showed cash paid to “Kalra ji”. On this basis, AO reopened u/s 147 & added ₹1.20 crore as undisclosed cash receipts. CIT(A) not only confirmed the addition but also enhanced ₹5 lakh received by cheque.
Assessee’s defence:
- No direct evidence of receiving any cash.
- His name not in seized papers; only “Kalra Ji” is mentioned.
- Statement of Bright Group Director (u/s 132(4)) did not name assessee.
- Director admitted no evidence of cash payments maintained.
- Faculty stopped teaching in Feb/March 2008 – yet additions made even beyond that.
- Bright Group claimed large batches of 500-600 students in auditoriums, but could not give any auditorium name, rent details, attendance registers, or proof of rent.
- Affidavits of students & study material showed actual batches of only 100-110 students at Laxmi Nagar premises, not auditoriums.
- In AY 2007-08, CIT(A) deleted similar addition on same documents, accepted by Revenue.
- In other faculty cases, additions deleted or ITAT also deleted (e.g., Vikas Kapoor case).
Tribunal’s Findings:
- Seized papers only say “Kalra Ji”, no proof it refers to assessee.
- Initial statements of directors do not support Revenue’s case.
- Revenue failed to show where classes were held or how 400-500 students attended.
- Huge contradiction between statements of different directors.
- No corroborative evidence – only loose papers = “dumb document”.
- Past year’s similar addition already deleted & accepted by department.
- Principle of consistency + absence of evidence = addition unsustainable.
Regarding ₹5 lakh cheque:
- Assessee received ₹5 lakh by cheque from Bright Star.
- He returned same amount by cheque after 6 months.
- No TDS deducted – proves it was loan, not income.
- Hence, enhancement also unjustified.
Result:
- Reopening u/s 147 upheld (in view of jurisdictional HC),
- BUT entire addition of ₹1.20 crore deleted,
- Enhancement of ₹5 lakh also deleted.
Key Reason:
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