ANNIE BEASENT CONVENT HIGH SCHOOL,BANGALORE vs. ITOWARD-2(1)(3), BLR/, BANGALORE

The present appeal is delayed by 110 days. Along with the appeal, the assessee has filed an application seeking condonation of the delay. Having considered the submissions made in the said application, we are of the considered view that there was sufficient cause which prevented the assessee from filing the present appeal within the prescribed limitation period. Accordingly, the delay in filing the present appeal is condoned, and we proceed to decide the appeal on the merits.

In this appeal, the assessee has raised the following grounds: - 1. The order of the learned Commissioner of Income-tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), is erroneous both on facts and in law. 2. The learned CIT(A) grossly erred in stating that the Appellant failed to provide documentary evidence such as bank statements, balance sheets, and audit reports. 3. The Appellant had explicitly submitted the Audited Balance Sheet, Profit and Loss Account, and the Corporation Bank Statement (Account No. 077200101001533) for FY 2013-14 during the proceedings. 4. The authorities failed to consider the Bank Statement which clearly shows that the total cash deposits made by the school amounted to Rs. 49,38,000, directly contradicting the alleged unexplained credit of Rs. 38,98,93,000. 5. The learned CIT(A) erred in confirming an addition of Rs. 38,98,93,000 u/s 69A, which is entirely unrelated to the Appellant's educational activities and bank accounts. 6. The authorities failed to discharge their primary onus of proving that the disputed "Multiyear NMS" transactions actually pertained to the Appellant's bank account before calling upon the Appellant to explain them.

The solitary grievance of the assessee is against the addition of Rs. 38,98,93,000/- on account of cash deposit.

The brief facts of the case pertaining to this issue as emanating from this record, are: The assessee is a trust and is running a school in the name of Annie Beasant Convent High School imparting education to primary and secondary school students. On the basis of the information received from the AIMS Module, it was noticed that the assessee has deposited a large amount of cash and did not file its return of income for the year under consideration. Accordingly, proceedings under section 147 of the Act were initiated and notice under section 148 of the Act was issued on 31.03.2021. In response to the statutory notices issued under section 142(1), the assessee furnished its audited balance sheet and Profit and Loss account. The assessee also submitted that for the financial year 2013-14, it had wrongly obtained the PAN under the partnership firm category vide PAN No.: AAQFA0891B in the name of the school, and hence did not file any income tax return and audit reports for the financial year 2013-14. Subsequently, a new PAN Card was obtained vide PAN No.: AAPAA1639E under the AOP category, and it has been filing the return of income under the new PAN. It was further submitted that the assessee intimated about the wrong PAN allotment and requested the cancellation of the erstwhile PAN. As regards the cash deposits, the assessee requested more details. It was also submitted that, under the new PAN, the assessee has filed the return of income for the assessment year 2014- 15, and the bank transactions reflected in the old PAN have been accounted for under the new PAN. Further, the return filed includes these transactions, and the same has also been processed. During the assessment proceedings, only a cash deposit of Rs. 48,38,000/- could be verified from the financial statements furnished by the assessee, and as the assessee could not establish that the remaining transactions were also accounted in the return filed, the Assessing Officer (“AO”) vide order dated 31.03.2023 passed under section 147 r.w.s. 144 of the Act, proceeded to consider the balance cash deposits of Rs. 38,98,93,000/- in the assessee’s bank account as unexplained money under section 69A of the Act and added the same to the total income of the assessee.

The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee and upheld the addition made by the AO under section 69A of the Act, in the absence of any documentary evidence substantiating the claim of the assessee. Being aggrieved, the assessee is in appeal before us.

During the hearing, the learned Authorised Representative (“learned AR”) submitted that the assessee has only one bank account maintained with Cooperation Bank, which is now merged with Union Bank of India, and its transactions are through the said bank account, which has been duly disclosed in the income tax return filed by the assessee for the year under consideration. The learned AR submitted that thus all the transactions of the erstwhile PAN have also been disclosed by the assessee in the return of income filed for the year under consideration on 08.03.2016. It was further submitted that the amount of Rs. 38,98,93,000/-, which is considered as unexplained money of the assessee under section 69A of the Act, does not belong to the assessee. In this regard, the learned AR also referred to the copy of the bank statement of the assessee’s account maintained with the Cooperation Bank, which is placed on record before us as additional evidence.

We have considered the submission of both sides and perused the materials available on record. In the present case, there is no dispute regarding the fact that the assessee held two PANs, and the erstwhile PAN, being obtained under the wrong category, was subsequently surrendered by the assessee, and the assessee now holds a PAN under the correct category as AOP. As certain cash deposits were noticed through information on the AIMS Module, proceedings under section 147 of the Act were initiated in the case of the assessee, during which the assessee submitted that all its transactions are conducted through a single bank account maintained with Cooperation Bank and the same have been duly disclosed in the income tax return filed under the new PAN. Further, the assessee submitted that even the transactions under the old PAN have also been disclosed by the assessee in the return of income filed under the new and valid PAN.

From the perusal of the record, we find that only to an extent of cash deposits of Rs. 48,38,000/- the transactions could be verified from the financial statements and the remaining cash deposit of Rs. 38,98,93,000/- remained unsubstantiated. It is the consistent plea of the assessee that the said amount does not belong to the assessee and all its transactions in the bank account maintained with the Cooperation Bank, which has now merged with the Union Bank of India, have already been disclosed. In support of its contention, the assessee has placed on record the bank statement of its account for the year under consideration, maintained with the Cooperation Bank. It is undisputed that the said bank statement has been furnished by the assessee for the first time and therefore requires detailed verification of the transactions recorded therein. Since the sole dispute concerns cash deposits in the assessee’s bank account, we are of the considered view that the said bank statement is a necessary document and, accordingly, the same is admitted as additional evidence.

Therefore, in view of the facts and circumstances of the present case as noted above, we restore this issue to the file of the Jurisdictional AO for de novo adjudication after detailed verification of the transactions recorded in the assessee’s bank statement furnished before us. Needless to mention, no order shall be passed without affording reasonable opportunity of hearing to the assessee. With the above directions, the impugned order is set aside, and the grounds raised by the assessee are allowed for statistical purposes.

In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open court on 23rd July, 2026. Sd/- Sd/- WASEEM AHMED SANDEEP SINGH KARHAIL ACCOUNTANT MEMBER JUDICIAL MEMBER Bangalore, Dated, the 23-July-2026. *VM* Copy to: ANNIE BEASENT CONVENT HIGH SCHOOL, NO 90/91, 12TH MAIN ROAD SRINIVASANAGAR SRIGANDHAKAVAL PIPELINE, 1 VISWANEEDAM S.O, MACHOHALLI, BANGALORE, 560091, KARNATAKA, INDIA, BENGALURU-560091, KARNATAKA