Delhi couple gets relief in ₹2.25 crore Black Money Act case after ITAT examines Singapore, BVI bank credits

The Income Tax Appellate Tribunal (ITAT), Delhi, has deleted ₹2.25 crore in additions made under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, giving full relief to a Delhi couple whose names were linked to foreign companies and bank accounts in the British Virgin Islands and Singapore.

The ITAT Delhi H Bench, in an order dated August 6, 2026, dismissed the Income Tax Department’s appeals against Nimit Rai Tiwari and Ankita Rai Tiwari. It also deleted the remaining commission-income addition and consequential penalty against Ankita Tiwari.

Why the Income Tax Department added ₹2.25 crore as undisclosed foreign income

The case concerned two foreign companies—Suncell Holdings SA (SHSA), registered in the British Virgin Islands, and Sino Star Minerals Pte Ltd (SSMPL), incorporated in Singapore.

Nimit Tiwari and his wife Ankita Tiwari were nominee shareholders in SHSA, holding 25,000 shares each. The shares were held at “no par value”, meaning no investment was required to acquire them. SHSA had a bank account with BNP Paribas.

According to the ITAT order, the bank closed SHSA’s account on April 30, 2014, after the company became non-operational and failed to obtain business. The company was subsequently struck off by the local authorities on May 1, 2015.

Nimit Tiwari was also a shareholder in SSMPL, incorporated on December 19, 2014, and held 150,500 shares. The tribunal noted that he had disclosed his shareholding and the company’s bank account in his income-tax return for assessment year 2016-17.

The tax department nevertheless initiated proceedings under Section 10 of the Black Money Act and treated credits in the foreign companies’ bank accounts as undisclosed foreign assets.

The assessing officer made a total addition of ₹2,25,53,976. This included ₹1,27,97,370 in the hands of each spouse, representing 50% of credits in SHSA, and ₹97,56,615 in Nimit Tiwari’s hands for the credit in SSMPL.

How the Delhi couple proved the foreign-company funds were loans

During proceedings before the Commissioner of Income Tax (Appeals), the couple submitted additional evidence explaining the source of the money credited to the foreign companies’ bank accounts.

The SHSA account had received amounts from V.L. Sharma and Sandip Brahmdev Sharma, while SSMPL had received USD 1,50,000 from V.L. Sharma.

The taxpayers submitted documents including the lenders’ income-tax returns and bank statements. The CIT(A) admitted the additional evidence and called for a remand report from the assessing officer.

The AO accepted that the two lenders had the financial capacity to provide the loans. The CIT(A), therefore, deleted the additions relating to the amounts received from V.L. Sharma and Sandip Brahmdev Sharma.

The Revenue challenged this relief before the ITAT.

The tribunal upheld the CIT(A)’s decision, noting that the loans were supported by evidence and that the AO himself had accepted the lenders’ financial capacity. Since the underlying liability was established, the amounts could not be treated as the taxpayers’ undisclosed income.

Why ITAT Delhi deleted the remaining ₹10.59 lakh addition

The CIT(A), however, had sustained an addition of USD 16,283, equivalent to about ₹10.59 lakh, representing 50% of a USD 32,565.19 credit in SHSA’s bank account. The credit had been treated as commission income.

The ITAT took a different view after examining the same bank statement.

The tribunal noted that the tax authorities had considered the USD 32,565 credit but overlooked debit entries totalling about USD 46,354 in the account. After considering both the credits and debits, the account showed a negative balance of USD 13,789.

The tribunal said that the company had therefore incurred a loss rather than generated positive income from the transactions. It consequently deleted the remaining commission-income addition as well.

The ITAT held that there was no financial asset left in SHSA requiring disclosure after the company had been struck off. It also noted that the Revenue had effectively considered only the credit entries while overlooking the corresponding debits in the same bank statement.

Since the couple succeeded on the merits, the tribunal dismissed both appeals filed by the Revenue, allowed the taxpayers’ cross-objections and deleted the consequential penalty. The additional jurisdictional grounds raised by the taxpayers were not adjudicated because they had already obtained relief on merits.