ITO Vs Tatiparti Satyanarayana (ITAT Visakhapatnam)
In ITO vs Tatiparti Satyanarayana, the Income Tax Appellate Tribunal Visakhapatnam considered an appeal filed by the Revenue against the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for Assessment Year 2017–18, along with cross objections by the assessee. The assessee, engaged in civil construction and jewellery business, had filed a return declaring income of ₹13,62,040. The case was selected for scrutiny, and due to inadequate response from the assessee, the Assessing Officer (AO) assessed total income at ₹1,51,26,623.
On appeal, the CIT(A) deleted the additions made by the AO based on evidence produced by the assessee. The Revenue challenged this decision on multiple grounds, including applicability of Section 69 to share transactions, treatment of cash sales during demonetisation, and admission of additional evidence without giving the AO an opportunity under Rule 46A.
The Tribunal examined whether Section 69 could be invoked. It held that Section 69 applies only to investments not recorded in the books. Since the assessee had disclosed the investment in the books of accounts, reflected it in the balance sheet, and offered income for taxation, the provision was not applicable. The Tribunal upheld the CIT(A)’s findings on this issue.
