SMV BEVERAGES PVT LTD,NEW DELHI vs. ACIT, CC-7, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI BENCH ‘A’: NEW DELHI BEFORE SHRI M BALAGANESH, ACCOUNTANT MEMBER AND MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER ITA No.1824/Del/2026 (Assessment Year: 2017-18) M/s SMV Beverages Pvt.Ltd. Assistant Commissioner of Income S-25, Main Market, Green Park, Tax, Central Circle-7, ARA Building, Vs. New Delhi Jhandewalan Extension, Delhi- 110055 PAN: AADCS8973L (Appellant) : (Respondent) Assessee by : Ms. Kanika Jain, Adv Respondent by : Shri Ajay Kumar Arora, Sr. DR Date of Hearing : 01.06.2026 Date of Pronouncement : 30.06.2026 O R D E R Per Kavitha Rajagopal, JM: This appeal is filed by the assessee, challenging the order of the Learned

Commissioner of Income Tax (Appeals) [‘Ld. CIT(A)’ for short], passed u/s. 250 of the

Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short)

2017-18.

“1. The order passed by the Ld. CIT(A) dismissing the appeal of the appellant is bad in law and on the facts and circumstances of the case.

ITA No. 1824/Del/2026 SMV Beverages (P.) Ltd. 2. The Ld. CIT(A) has erred in law and on facts in confirming the action of the Assessing Officer in assessing the income at Rs. 1,66,84,150/- invoking the provisions of Section 115BBE of the Income Tax Act, 1961 by failing to appreciate that the Appellant had provided sufficient explanation regarding the source of funds/credits. 3. The Ld. CIT(A) has erred in law and on facts in not adjudicating the appeal based on the additional evidence filed by the Appellant under Rule 46A. In that the Ld. CIT(A) failed to appreciate that once the additional evidence was forwarded to the Assessing Officer for a Remand Report, the said evidence is deemed to have been admitted and ignoring such evidence, which goes to the root of the matter, while passing the impugned order is contrary to the settled principles of judicial precedent and natural justice. 4. The Ld. CIT(A) erred in dismissing the appeal without providing a proper and meaningful opportunity of being heard and advancing oral arguments, thereby violating the principles of natural justice. 5. The Ld. CIT(A) has gravely erred in disposing off the appeal of the Appellant summarily, mechanically and without any application of mind. 6. The Ld. CIT(A) erred in confirming the initiation of penalty proceedings, which is unwarranted given the facts of the case. 7. The above grounds of appeals are independent and without prejudice to one another. 8. The appellant may be allowed to add / withdraw or amend any ground of appeal at the time of hearing.”

manufacturing of beverages and had filed its original return of income dated

26/10/2017 with a loss of Rs. 14,51,39,386/- under the normal provision where the

turnover of the company was declared at Rs. 1,96,43,84,600/- on which gross profit of

Rs. 58,44,17,476/- which was shown @ 29.75% and net profit of Rs. 15,75,49, 406/- was

ITA No. 1824/Del/2026 SMV Beverages (P.) Ltd. shown @ -8.02%. The assessee’s case was selected for scrutiny and notices u/s 143(2)

and 142(1) were duly issued and served upon the assessee. The Ld. A.O. then passed

the assessment order u/s 143(3) of the Act dated 30/12/2019 determining total loss of

Rs. 14,51,39,386/- after making an addition of Rs. 1,66,84,150/- as unexplained cash u/s

68 of the Act chargeable to tax u/ s 115BBE @ 60%.

vide order dated 17/02/2026 upheld the addition made by the A.O. by rejecting the

assessees’ additional evidences filed under Rule 46A of the Rules.

the Ld. CIT(A).

record. It is observed that the assessee has made a cash deposit during demonization

period aggregating to Rs. 3,05,34,500/- out of which Rs. 2,38,34,500/- was made in

specified bank notes (SBN). The Ld. A.O. after duly considering the assessee’s

submission held that 30% of the said deposit was from sales during the period of September 2016 to 08th November, 2016 to the extent of Rs. 71,50,350/- and treated

the balance amount of Rs. 1,66,84,150/- to be unexplained cash credit as bogus sales

and bogus cash deposits credited to the books of account of the assessee during the

said period. Before the Ld. CIT(A), the assessee filed an application for admission of

ITA No. 1824/Del/2026 SMV Beverages (P.) Ltd. additional evidence under Rule 46A of the Income Tax Rules, 1962, where the assessee

intended to furnish Business Transfer Agreements and the addresses of all retailers from

whom deposits were received. The assessee stated that the said documents were not

produced before the Ld. A.O. as no sufficient opportunity was provided. The Ld. CIT(A)

rejected the admission of additional evidence filed under Rule 46A of the Rule on the

ground that thought the assessee had sufficient opportunity to adduce the said

evidence before the Ld. A.O. the same was not produced and the assessee has failed

to explain that there was sufficient cause for non prosecution of the evidences before

the Ld. A.O. The Ld. CIT(A) upheld the addition made by the Ld. A.O.

the assessee has got a good case on the merits and due to unavoidable circumstances

the assessee was unable to produce the additional evidence before the Ld. A.O.

of the Ld. CIT(A). On the above factual matrix of the case, it is observed that the Ld.

CIT(A) has denied the additional evidences filed by the assessee and had also not

adjudicated the issue on the merits. As the basis of the said evidences, though the Ld.

CIT(A) had the power of co-terminus as that of the Ld. A.O. In order to extend, the

assessee one more opportunity to adduce all documentary evidences, we deem it fit to

remand this issue back to the file of Ld. A.O. by adhering to the principles of natural

justice and in the interest of justice dispensation. The assessee is directed to strictly

ITA No. 1824/Del/2026 SMV Beverages (P.) Ltd.

comply with the proceeding before the Ld. A.O. and to furnish all relevant documentary

evidences in support of its claim and the Ld. A.O. is directed to pass a de-novo

assessment order on the basis of the submissions and evidences filed by the assessee

along with admitting the additional evidences proposed to be filed by the assessee.

statistical purpose.

statistical purpose.

Order pronounced in the open court on 30 .06.2026

Sd/- Sd/- (M BALAGANESH) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Date:- 30 .06.2026 Reshma Naheed, Sr.P.S Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT

ASSISTANT REGISTRAR ITAT, NEW DELHI

ITA No. 1824/Del/2026 SMV Beverages (P.) Ltd.