ITAT Ahmedabad Remands ₹7.71 Crore Addition Over Possible Duplication In Bank Credits

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April 2026 held that additions based on bank credits, accommodation entries and interest income must be properly reconciled to avoid duplication while determining taxable income.

A Bench comprising Judicial Member TR Senthil Kumar and Accountant Member Narendra Prasad Sinha partly allowed the appeal filed by Money Assurance Services for assessment year 2014–15, observing:

“The AO should have excluded the interest income and accommodation entry credited to the HDFC bank account and thereafter considered only the balance amount for making the addition.”

The Assessing Officer had added Rs. 3.41 crore towards HDFC Bank credits, Rs. 50 lakh towards cash deposits, Rs. 2.35 crore towards alleged accommodation entries, and Rs. 1.44 crore towards interest income after the taxpayer failed to file returns or respond to statutory notices.

The Tribunal found a possible overlap among these components and held that the Assessing Officer must verify the figures to prevent double addition of the same income. It also held that taxing entire bank credits without considering corresponding debit entries could not be justified.

Accordingly, the ITAT remanded the matter to the Assessing Officer for fresh verification and recomputation in accordance with law.