IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘E’: NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER&

SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER [Assessment Year: 2016-17]

DCIT Rakesh Arora Central Circle 3 C4-4123, Vasant Kunj, Room No.333, E-2, ARA Vs Delhi-110070 Centre, Jhandewalan PAN No.AAEPA7287P Extension, New Delhi-110055 Appellant Respondent Revenue by Ms. Ankush Kalra, Sr. DR Assessee by Sh. Ankit Kumar, Advocate Date of Hearing 29.10.2025 Date of Pronouncement 10.12.2025

ORDER

PER AMITABH SHUKLA, AM, The captioned appeal has been preferred by the Revenue against order dated 06.02.2025 of the Commissioner of Income Tax (Appeals)- 25, Delhi [hereinafter referred to as ‘ld. CIT(A)’] arising out of assessment order dated 30.12.2018 passed u/s 143(3) of the Income Tax Act, 1961pertaining to Assessment Year 2016-17. The word ‘Act’

herein in this order would mean Income Tax Act, 1961.

2. The Revenue has raised following grounds of appeal:-

“1. Whether the Ld. CIT(A) erred in deleting the addition of Rs. 1,69,69,770/- u/s 2(22)(e) of the Act and the addition of Rs. 4,65,85,000/- u/s 69A on technical ground that the additions were beyond the scope of limited scrutiny, ignoring the fact that the addition was clearly within the scope of the reason for limited scrutiny which stated: -"(i) Whether the investment and income relating to securities transactions are duly disclosed. (ii) Whether the investment and income relating to securities (derivative) transactions are duly disclosed"; and the undisclosed income assessed is related to the investment in securities.

2. Whether Ld. CIT(A) erred in not appreciating that the AO had examined the source of investments and found that credits in the 2 form of unsecured loan from M/s Rajdhani Nursuries Ltd. and other credits in bank account are amenable to addition u/s

2(22)(e) and section 69A of the Act respectively.

3. Whether on the facts and circumstances the Ld. CIT(A) erred in not deciding the addition u/s 2(22)(e) and section 69A on merits.

3. The first issue raised by the Revenue through its grounds of appeal number 1 and 2 are regarding the deletion of addition of Rs.1,69,69,770/- u/s 2(22)(e) and Rs.4,65,85,000/- under section 69A of the Act by the ld. AO. The ld. CIT(A) has given relief on the premises that the ld. AO ought to have converted the limited scrutiny case to complete scrutiny category by taking prior approval of supervisory authority. Before proceeding further, we deem it appropriate to briefly examine the brief factual matrix of the case. As per facts recorded by ld. AO in para 1 of his order, the assessee has filed Return of Income of Rs.26,65,000/- on 31.03.2017. The case was picket up for limited scrutiny on following grounds:-

i. Whether the investment and income relating to security transactions are duly disclosed and ii. Whether the investment and income relating to securities (derivative) are duly disclosed.

4. The ld. AO after conducting his detailed enquiries and investigation made addition of Rs.1,69,69,770/- u/s 2(22)(e) of the Act as deemed dividend and further another amount of Rs.4,65,85,000/- as unexplained money under section 69A of the Act. While making the latter addition, the ld. AO on page12 of his order noted that the assessee has the onus to prove the impugned crudities in his bank accounts and also that the assessee was deliberately delaying filing of submissions so as to avoid meaningful timely enquiries. Before the ld. CIT(A), the assessee had, inter alia, contended that its case was selected under the category of limited scrutiny but additions were made on other issues which required prior approval of the PCIT and that since the same was not done the addition deserves to be deleted. The Ld. CIT(A) as seen in para-8 of his order concluded as under:-

“…..6. It is submitted that learned Commissioner of Income Tax (Appeals) relied on the CBDT instructions no. 7/2014 dated 26.09.2014, Instruction No. 20/2015dated 29.12.2015 (pages 31-32 of Paper Book),