ITAT Orders Fresh Probe into Rs.50 Lakh Cash Robbery Case, Asks Department to Verify Farmers’ Claims [Read Order]

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has sent back the case involving an addition of Rs.50 lakh under Section 69A of the Income Tax Act to the Assessing Officer for a fresh review. The Tribunal has directed the tax department to thoroughly examine claims that the cash, allegedly seized from the appellant Kishan Lal, did not belong to him but to a group of farmers.

Kishan Lal, the appellant in the matter, had approached the Tribunal against the order of the Commissioner of Income Tax (Appeals) dated 23 November 2023, which had confirmed the addition of Rs.50 lakh as unexplained cash under Section 69A and also upheld the consequential tax charged under Section 115BBE and interest under Sections 234A and 234B.

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According to the appellant’s submissions, the cash in question was stolen from him during a highway robbery. The police had recovered Rs.30.38 lakh from the accused, who admitted to robbing Rs.50 lakh. Kishan Lal clarified that only Rs.5 lakh of the looted money belonged to him, while the rest was the property of 26 farmers from whom he had collected sale proceeds in Delhi as part of his work as a commission agent. He supported this claim with affidavits from the farmers and a report from the local police confirming the same. The appellant also cited a judicial order dated 1 May 2018 from the Judicial Magistrate, Court No. 4, Aligarh, which had accepted the position that the money belonged to the farmers and directed that it be returned to them.

The Tribunal observed that the Commissioner of Income Tax (Appeals) had passed an ex parte order without properly considering the documents and submissions of the appellant. The ITAT noted that the appellant, being a small farmer and commission agent, might not have been well-versed with the technicalities of online proceedings and should have been granted a proper hearing.

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Referring to the submissions and documents including the FIR, police report, affidavits of farmers, and the judicial order, the Tribunal held that a deeper examination of the claims was necessary. The Bench restored the matter to the file of the Assessing Officer with directions to verify the authenticity of the evidence provided and to reconsider the entire issue after granting a fair hearing.

The order was passed by a division bench comprising Challa Nagendra Prasad, Judicial Member, and Naveen Chandra, Accountant Member, on 7 February 2025. The appeal has been allowed for statistical purposes.

To Read the full text of the Order CLICK HERE

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