Bank Account Opened Fraudulently in Assessee’s Company, AO adds Rs. 15 cr as Protective Addition: ITAT Deletes Addition

The Income Tax Appellate Tribunal (ITAT) has deleted a ₹1.5 crore protective addition made by the Assessing Officer (AO), which was based on a bank account opened fraudulently in the assessee's company name. The ITAT recognized that the assessee was a victim of fraud and not genuinely involved in the transactions. A protective addition is typically made when there's uncertainty about the actual taxpayer. This ruling provides crucial relief, ensuring that taxpayers are not penalized for fraudulent activities perpetrated against them, especially when they can prove lack of involvement and the fraudulent nature of the account.