2025 (7) TMI 1363 - AT - Income Tax

Reopening of assessment - reasons to believe - unsecured loans representing unexplained cash credits had escaped assessment - HELD THAT - The Revenue could hardly dispute the clinching fact that the assessment herein is an unabated one wherein any addition could be made specifically qua the seized material only in light of PCIT vs. Abhisar Buildwell Pvt. Ltd. 2023 (4) TMI 1056 - SUPREME COURT A perusal of assessment discussion suggests that no such details were available with the AO so far as the impugned unsecured loans are concerned. Faced with this situation find no merit in the Revenue s vehement arguments seeking to add the impugned unsecured loans in the assessee s hands since not represent the incriminating material as per their lordships above landmark decision. The same is directed to be deleted. Assessee s appeal is allowed.

Summary

The Appellate Tribunal (ITAT Delhi) in the appeal for AY 2013-14 against the CIT(A)-3, Noida's order under sections 143(3) read with 147 of the Income Tax Act, 1961, proceeded ex-parte due to the assessee's non-appearance. The reopening under sections 148/147 was based on "reasons to believe" that unsecured loans of Rs. 30,00,000 constituted unexplained cash credits escaping assessment. However, the Tribunal relied on the Supreme Court ruling in PCIT vs. Abhisar Buildwell Pvt. Ltd. (2023) 454 ITR 212 (SC), noting that the assessment was "unabated" and additions could only be made based on "seized material." Since no such incriminating details were available regarding the unsecured loans, the Tribunal held there was "no merit" in the Revenue's claim and directed deletion of the addition. The appeal was allowed.