ARJUN VIJAYNARYAN UPADHYAY ,MUMBAI vs. DCIT, CIRCLE 41(1)(1), MUMBAI

The impugned order emanated from the order of Ld. ACIT-26(1), Mumbai (for brevity ‘Ld. AO’), order passed under section 143(3) of the Act date of order 11.12.2019.

Grounds of appeal read as under :-

Brief facts of the case are that the assessee filed return by declaring total income at Rs. 35,10,160/-. The assessee’s case was selected for scrutiny under CASS. The assessee is proprietor of M/s Amravati Petroleum. The assessee is a dealer in petrol, diesel, oil and lubricants and holding the dealership of HPCL. During the assessment, Ld. AO noticed that the assessee had deposited a cash amounting to Rs. 2,59,73,330/- into the bank account bearing account No. 012620110000282, Bank of India during demonetization period. The Ld. AO had added back 20% cash deposited in the bank which comes to Rs. 51,94,666/- and was added back under section 69A of the Act. Aggrieved, the assessee filed an appeal before Ld. CIT(A). Ld. CIT(A) rejected the appeal of the assessee on the ground that the assessee was unable to explain source for depositing the cash into the bank account. The assessee had deposited cash in SCN during demonetization period. Ld. CIT(A) rejected the appeal of the assessee. Being aggrieved, the assessee filed an appeal before us.

The Ld. AR argued and contended that the assessee had filed an application under Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963 seeking admission of additional evidence. It was submitted that the details of the additional evidence, along with the reasons for its admission, have been duly furnished in the application. The same are reproduced below:

The Ld. DR supported the orders of the revenue authorities. However, with regard to the assessee's application for admission of additional evidence, the Ld. DR did not raise any serious objection.

We have heard the rival submissions and perused the material available on record. The assessee filed the return of income and is engaged in the business of trading in petroleum products under the trade name M/s Amravati Petroleum. During the relevant assessment year, the assessee deposited cash amounting to Rs. 2,59,73,330/- in its bank account during the demonetisation period. During the course of assessment proceedings, the Ld. AO observed that the assessee had failed to satisfactorily explain the source of the cash deposits and, accordingly, treated 20% of the total cash deposits, amounting to Rs. 51,94,666/-, as unexplained money under Section 69 of the Act. Before us, the Ld. AR submitted that the assessee is an authorised dealer in petroleum products of HPCL and was entitled to receive cash during the demonetisation period in accordance with the applicable notifications and exemptions. It was further submitted that, owing to certain circumstances, the relevant supporting documents could not be produced before the revenue authorities during the assessment or appellate proceedings. The assessee has now filed additional evidence, including a certificate issued by HPCL in support of its status as a petroleum dealer and the relevant bank statement pertaining to Account No. 012620110000282 of Indian Bank Ltd. Upon consideration of the additional evidence, we find that the documents are material and go to the root of the controversy. In the interest of justice, the additional evidence deserves to be admitted under Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963. Since these documents require factual verification, we deem it appropriate to restore the matter to the file of the Ld. AO for de novo adjudication. The Ld. AO shall examine the additional evidence, verify its authenticity and relevance, and thereafter decide the issue afresh in accordance with law after affording the assessee a reasonable opportunity of being heard. Needless to say, the assessee shall extend full cooperation and furnish all requisite details and documents called for by the Ld. AO to facilitate the expeditious disposal of the remanded proceedings.

In the result, appeal of the assessee bearing ITA No. 255/Mum/2026 is allowed for statistical purposes.

अपीलाथ�/The Appellant , 2. �ितवादी/ The Respondent. 3. आयकरआयु� CIT 4. िवभागीय�ितिनिध, आय.अपी.अिध., मुंबई/DR, ITAT, Mumbai 5. गाड�फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, MUMBAI