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Facts
The assessee appealed against an order upholding the disallowance of expenditure related to change in inventories and additions for cash deposits made from earlier sales. The appeal was filed for assessment year 2017-18.
Held
The Tribunal noted that the assessee did not appear for the hearing and that a similar appeal with identical grounds was already pending. Considering the present appeal to be a duplicate, it was rendered infructuous.
Key Issues
Whether the appeal is a duplicate of a previously filed appeal and therefore infructuous, and whether the disallowance of inventory change and additions for cash deposits were justified.
Sections Cited
69A, 115BBE
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Income Tax Appellate Tribunal, MUMBAI BENCH “F” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI RAJ KUMAR CHAUHAN
ORDER
PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated 06.06.2025 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2017-18, raising following grounds:
Ground No. 1 - Disallowance of expenditure on account of change in inventories: Rs. 8,53,84,479/-
1.1 On the facts and in circumstances of the case and in law, the 1.1 On the facts and in circumstances of the case and in law, the 1.1 On the facts and in circumstances of the case and in law, the learned CIT(A) erred in upholding learned CIT(A) erred in upholding the action of the learned AO in the action of the learned AO in disallowance of expenditure on account of change in inventories on disallowance of expenditure on account of change in inventories on disallowance of expenditure on account of change in inventories on the alleged ground of lack of satisfactory justification inasmuch all the alleged ground of lack of satisfactory justification inasmuch all the alleged ground of lack of satisfactory justification inasmuch all the requisite details pertaining to the inventory valuation was duly the requisite details pertaining to the inventory valuation was duly the requisite details pertaining to the inventory valuation was duly submitted and thus submitted and thus, the entire disallowance ought to be deleted; , the entire disallowance ought to be deleted; 1.2 The learned CIT(A) failed to appreciate and ought to have that 1.2 The learned CIT(A) failed to appreciate and ought to have that 1.2 The learned CIT(A) failed to appreciate and ought to have that method of inventory valuation was based on settled principles of method of inventory valuation was based on settled principles of method of inventory valuation was based on settled principles of accounting, i.e. Accounting Standard accounting, i.e. Accounting Standard - 2 ('AS-2') issued by the 2') issued by the Institute of Chartered Accountants of India ('ICAI') and is duly Chartered Accountants of India ('ICAI') and is duly Chartered Accountants of India ('ICAI') and is duly accepted by law and thus, any change in inventory valuation as per accepted by law and thus, any change in inventory valuation as per accepted by law and thus, any change in inventory valuation as per AS-2 is allowable as business expenditure. 2 is allowable as business expenditure. 1.3 Without prejudice to the above, the learned CIT(A) ought to have 1.3 Without prejudice to the above, the learned CIT(A) ought to have 1.3 Without prejudice to the above, the learned CIT(A) ought to have appreciated that if the d appreciated that if the disallowance made by the learned AO with isallowance made by the learned AO with respect to closing stock value is upheld then the opening stock of respect to closing stock value is upheld then the opening stock of respect to closing stock value is upheld then the opening stock of immediate subsequent year, i.e. AY 2018 immediate subsequent year, i.e. AY 2018-19 will consequently 19 will consequently increase Ground No. 2 increase Ground No. 2 – Addition u/s, 69A rws 115BBE of the Act Addition u/s, 69A rws 115BBE of the Act of cash deposits made ou of cash deposits made out of earlier year sales: Rs. 12,88,221/ t of earlier year sales: Rs. 12,88,221/- 2.1 On the facts and in circumstances of the case and in law, the 2.1 On the facts and in circumstances of the case and in law, the 2.1 On the facts and in circumstances of the case and in law, the learned CIT(A) erred in upholding the action of the learned AO in learned CIT(A) erred in upholding the action of the learned AO in learned CIT(A) erred in upholding the action of the learned AO in making addition of cash deposited during demonetization period making addition of cash deposited during demonetization period making addition of cash deposited during demonetization period pertaining to the sa pertaining to the sales made in earlier years inasmuch as appellant les made in earlier years inasmuch as appellant has duly discharged its onus to prove that the cash deposited were has duly discharged its onus to prove that the cash deposited were has duly discharged its onus to prove that the cash deposited were out of sales made in earlier years and thus, the entire addition of out of sales made in earlier years and thus, the entire addition of out of sales made in earlier years and thus, the entire addition of unexplained made on surmises and conjectures ought to be deleted; unexplained made on surmises and conjectures ought to be deleted; unexplained made on surmises and conjectures ought to be deleted; 2.2 The CIT(A) failed to appreciate and ought to have held that CIT(A) failed to appreciate and ought to have held that CIT(A) failed to appreciate and ought to have held that provisions of section 69A of the Act could be invoked in case of provisions of section 69A of the Act could be invoked in case of provisions of section 69A of the Act could be invoked in case of violation of cumulative conditions, viz. failure to record money in violation of cumulative conditions, viz. failure to record money in violation of cumulative conditions, viz. failure to record money in books of accounts and offer no explanation/ unsatisfactory books of accounts and offer no explanation/ unsatisfactory books of accounts and offer no explanation/ unsatisfactory explanation inasmuch as since the fact that appellant has recorded tion inasmuch as since the fact that appellant has recorded tion inasmuch as since the fact that appellant has recorded money in books of accounts, the provisions of section 69A of the Act money in books of accounts, the provisions of section 69A of the Act money in books of accounts, the provisions of section 69A of the Act is not applicable and entire unlawful addition made u/s. 69A of the is not applicable and entire unlawful addition made u/s. 69A of the is not applicable and entire unlawful addition made u/s. 69A of the Act is liable to be deleted; Act is liable to be deleted; 2.3 The CIT(A) failed to appre 2.3 The CIT(A) failed to appreciate and ought to have held that once ciate and ought to have held that once sales are recognized in a particular year as per the audited books of sales are recognized in a particular year as per the audited books of sales are recognized in a particular year as per the audited books of account and offered to tax in respective year then the action of account and offered to tax in respective year then the action of account and offered to tax in respective year then the action of making addition of the said sales again in the year in which cash is making addition of the said sales again in the year in which cash is making addition of the said sales again in the year in which cash is received and received and deposited in bank account amounts to double taxation deposited in bank account amounts to double taxation in in in the the the hands hands hands of appellant of appellant of appellant which which which is is legally is legally legally invalid invalid invalid and and and liable to be deleted.
Despite due service of notice, none appeared on behalf of the Despite due service of notice, none appeared on behalf of the Despite due service of notice, none appeared on behalf of the assessee at the time of hearing, nor was any application seeking assessee at the time of hearing, nor was any application seek assessee at the time of hearing, nor was any application seek adjournment placed on record. adjournment placed on record.
The learned Departmental Representative (DR) brought to our The learned Departmental Representative (DR) brought to our The learned Departmental Representative (DR) brought to our notice that another appeal arising from the very same impugned notice that another appeal arising from the very same impugned notice that another appeal arising from the very same impugned order of the learned CIT(A), involving identical grounds, has already order of the learned CIT(A), involving identical grounds, has already order of the learned CIT(A), involving identical grounds, has already been registered as registered as ITA No. 4897/Mum/2025. It was pointed out 4897/Mum/2025. It was pointed out that the said appeal was listed for hearing on 17.09.2025 and, upon that the said appeal was listed for hearing on 17.09.2025 and, upon that the said appeal was listed for hearing on 17.09.2025 and, upon request of the assessee, has been adjourned to 29.10.2025. The request of the assessee, has been adjourned to 29.10.2025. The request of the assessee, has been adjourned to 29.10.2025. The learned DR submitted that the present appeal, being a duplicate learned DR submitted that the present appeal, being a duplicate learned DR submitted that the present appeal, being a duplicate appeal against the same or appeal against the same order, does not call for separate der, does not call for separate adjudication.
Having considered the factual position brought to our notice, Having considered the factual position brought to our notice, Having considered the factual position brought to our notice, we are of the view that the present appeal is indeed a duplicate of we are of the view that the present appeal is indeed a duplicate of we are of the view that the present appeal is indeed a duplicate of ITA No. 4897/Mum/2025. Accordingly, the present appeal is ITA No. 4897/Mum/2025. Accordingly, the present appeal is ITA No. 4897/Mum/2025. Accordingly, the present appeal is rendered infructuous and is dismissed as such. s and is dismissed as such.
In the result, the appeal of the assessee is dismissed. In the result, the appeal of the assessee is dismissed. In the result, the appeal of the assessee is dismissed.