M/S SHIVA ENTERPRISES,,BALLIA vs. INCOME TAX OFFICER, WARD - 2(5), BALLIA

The assessee has filed this appeal challenging the order dated 26.12.2017 passed by Ld CIT(A), Varanasi and it relates to the assessment year 2014-15.

The assessee is aggrieved by the decision of the ld. CIT(A) in confirming the addition of Rs.7,90,254/- relating to bank deposits.

None appeared on behalf of the assessee. Hence, we proceed to dispose of the appeal ex parte without the presence of the assessee. The assessee is engaged in the business of providing recharge voucher and ‘e’ top of telecom industries. During the course of assessment proceedings, the AO noticed that the assessee has deposited a sum of Rs.71.75 lakhs in his bank account on 02.04.2013. Regarding the source of deposits, the assessee explained that they represented sale proceeds of the relevant year. The AO noticed that the deposits made into the bank account was excessive vis-à-vis the actual sales of Rs.8,82,880/-. The AO assessed the same as income of the assessee. It appears that the above-said addition was reduced to Rs.7,90,254/- in the order passed u/s 154 of the Act. Before the ld. CIT(A), the assessee did not press this ground and, hence, the ld.CIT(A) confirmed the addition made by the AO.

Before us, the assessee is in appeal stating that the addition was wrongly agreed before the ld.CIT(A). The assessee has submitted that he was constrained to make deposits on 2nd April, 2013 due to continuous holidays from 29th March 20 13to 1st April, 2013. It was also submitted in the written submission that there is no difference between sales and bank deposits. Thus, it appears that the assessee is in a position to explain the difference now. Accordingly, we are of the view that, in the interest of natural justice, this issue requires fresh examination at the end of the AO. The Ld D.R submitted that the assessee cannot agitate the additions, which have been agreed to by him. In our view, the same will not bar the assessee if new facts have come to his notice later.

Accordingly, we set aside the order passed by the ld.CIT(A) on this issue and restore the matter to the file of the AO for examining it afresh. After affording adequate opportunity of being heard to the assessee, the AO may take appropriate decision in accordance with the law.

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes.