Medical Admission Agent Declared Rs. 18.63 Lakh Income but Faced Rs. 1.01 Crore Tax Addition After Search; ITAT Dismisses Revenue’s Appeal as Infructuous

The Bengaluru Bench “A” of the Income Tax Appellate Tribunal (ITAT) has dismissed the appeal filed by the Income Tax Department against taxpayer Jasmin Gopala Krishan for AY 2021-22, observing that the appeal has become infructuous on account of a subsequent rectification order passed by the CIT(A).

The case was registered on the basis of search conducted under Section 132 of the Income Tax Act, 1961 on 17 February 2021 in the case of M/s Srinivasa Educational and Charitable Trust. In the search proceedings, name of the assessee was incorrectly mentioned as “Jasmine Kumar” instead of “Jasmin Gopala Krishan” in the search warrant.

The assessee had filed his income tax return for AY 2021-22 declaring an income of Rs. 18,63,470 which was initially processed without any adjustments. The case was subsequently chosen for scrutiny. The AO issued notices under Sections 143(2) and 142(1) on several occasions but the department said there was no response from the assessee. Accordingly, the AO made the best judgement assessment u/s 144 and made an addition of Rs. 1,01,94,532 approximately to the income of the assessee.

Aggrieved by the order of assessment, assessee filed an appeal before CIT(A). The CIT(A) during the course of hearing of the appeal noted that the additions were made on the basis of unexplained credits and cash deposits and no incriminating material was found during the course of search in support of additions. Relying on the Supreme Court judgment in PCIT Central-3 vs Abhisar Buildwell (P.) Ltd., the CIT(A) deleted the additions.

This order was challenged by the Income Tax Department before the ITAT. However, at the time of hearing, the counsel for the assessee drew attention that the CIT(A) later realised that AY 2021-22 was actually an abated assessment year. So the previous determination of it being an unabated assessment was wrong.

To rectify the same CIT(A) initiated rectification proceedings under section 154 of the Income Tax Act. The CIT(A) passed rectification order on January 28, 2026 after issuing notice, getting response from assessee and considering the remand report of AO. In that order, the additions were deleted on merits rather than on the ground that there was no incriminating material.

The Tribunal noted that once the original appellate order had been rectified, the Revenue should have challenged the rectification order under Section 154 instead of continuing with its appeal against the original order passed under Section 250.

Accordingly, the ITAT held that the Revenue’s appeal against the original CIT(A) order had become infructuous and not maintainable and therefore dismissed the appeal.