ACIT, Circle 34 (1), vs. Vishakha Builders LLP

Parties Involved

Facts Summary

The assessee, Vishakha Builders LLP, filed its return of income declaring a total income of Rs.17,52,270/- for the assessment year 2022-23. The case was selected for scrutiny under CASS, primarily to verify large deductions claimed under Chapter VI-A. The assessee claimed a deduction of Rs.3.25 crores under section 80GGB for contributions made to a political party. The Assessing Officer (AO) rejected the assessee's submissions and proposed an addition of Rs.3,25,00,000/- under section 69A of the Income-tax Act, 1961, citing unexplained money. The assessee appealed this decision before the Learned Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, who deleted the addition, finding that the transactions were recorded in the books of account. The revenue then appealed to the Income Tax Appellate Tribunal (ITAT).…

Legal Issues

• 1. Whether the Ld. CIT(A) erred in deleting the addition of Rs.3,25,00,000/- made on account of unexplained money under the provisions of section 69A read with section 115BBE of the Act.
• 2. Whether the Ld. CIT(A) erred in deleting the addition despite the AO's observation that 95% of the assessee's gross income was donated to a political party without a satisfactory explanation of the source.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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