Nitin Naryan Keskar Vs ITO (ITAT Pune)
Unexplained Capital Spike Stands: ITAT Pune Upholds ₹1.70 Cr Addition u/s 68
Capital Can’t Grow in a Vacuum: ₹1.70 Cr Addition Sustained- No Returns, No Proof, No Relief: ITAT Backs 68 Addition- Afterthought Ledgers Don’t Save Unexplained Capital
In Nitin Narayan Keskar vs. ITO (ITA No.1000/PUN/2025, AY 2014-15; order dated 29-12-2025), the Pune Bench “A” of the ITAT dismissed the Assessee’s appeal and confirmed addition of ₹1,70,64,449 u/s 68 on account of unexplained increase in proprietor’s capital. The Assessee, a contractor with MES, had shown proprietor’s capital of ₹2.31 crore in AY 2014-15, whereas the last available balance sheet (AY 2011-12) reflected capital of only ₹54.57 lakh. Crucially, no returns were filed for AYs 2012-13 & 2013-14.
The AO held that the Assessee failed to explain the source of the sharp capital accretion, especially when the disclosed income for AY 2014-15 was only ₹6.44 lakh. Although the matter had earlier been remanded by ITAT for admission of additional evidence, the Ld. CIT(A)/NFAC—after considering remand reports and voluminous balance sheets/capital accounts produced belatedly—found the evidences unreliable, unvouched and an afterthought, noting a complete shift in stand by the Assessee and the time-barred nature of alleged past receipts.
The Tribunal observed that, in the absence of returns for intervening years and credible contemporaneous evidence, the Assessee failed to discharge the onus to explain the capital increase. Finding no infirmity in the detailed findings of the Ld. CIT(A)/NFAC, the ITAT upheld the addition and dismissed the appeal.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal filed by the assessee is directed against the order dated 20.02.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2014-15.
