PADMAVATHI,COIMBATORE vs. ITO, NCW-3(2), COIMBATORE

PDF · subscribers
ITA 3863/CHNY/2025Status: DisposedITAT Chennai02 June 2026AY 2017-185 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that since the assessee has now produced the cash book and other supporting documents before it, the matter requires fresh verification by the AO. The orders of the lower authorities were set aside.

What were the facts?

The assessee, a stamp vendor, deposited a significant amount of cash into her bank accounts during the demonetisation period. The Assessing Officer (AO) made an addition to her income as she failed to produce her cash book for verification.

What were the issues?

Whether the addition made by the AO on account of unexplained cash deposits is justified without verifying the cash book and other supporting documents now produced by the assessee.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI S.S. VISWANETHRA RAVI & SHRI S. R. RAGHUNATHA

Hearing: 16.04.2026Pronounced: 02.06.2026

Heard together (2 matters)

ITA No.3863/CHNY/2025
SA No.10/Chny/2026

Read from the judgment's own cause title. This page is filed under one of them.

आयकर अपीलीय अधिकरण, ‘ बी’ न्यायपीठ, चेन्नई IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI श्री एस एस विश्वनेत्र रवि, न्याविक सदस्य एिं श्री एस. आर. रघुनाथा, लेखा सदस्य के समक्ष BEFORE SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI S. R. RAGHUNATHA, ACCOUNTANT MEMBER आयकर अपीलसं./ITA No.3863/CHNY/2025 ननिाारण वर्ा / Assessment Year: 2017-18 & SA No.10/Chny/2026 (Arising out of ITA No.3863/Chny/2025) (ननिाारण वर्ा / Assessment Year: 2017-18 Padmavathi, The Income Tax Officer 11, Rathina Vinayagar Koil Street, vs. Non-Corp Ward-3(2) T N Palayam, Jothi, Coimbatore. Jothipuram S.O, Coimbatore North Coimbatore – 641 047. [PAN: BDDPP-8051-M] (प्रत्यर्थी/Respondent) (Applicant) अपीलार्थी की ओर से/ Appellant by : Shri. S. Bhupendran, Advocate प्रत्यर्थी की ओर से/Respondent by : Ms. Gouthami Manivasagam, Addl.CIT सुनवाई की तारीख/Date of Hearing : 16.04.2026 घोर्णा की तारीख/Date of Pronouncement : 02.06.2026 आदेश/ O R D E R PER S. R. RAGHUNATHA, AM : This appeal by the assessee is arising out of the order dated 26.11.2025, passed by the Learned Commissioner of Income Tax (Appeal), NFAC, Delhi (in short “ld.CIT(A)”) for the assessment year (A.Y) 2017-18 against the assessment order u/s.143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) passed by the AO, dated 31.12.2019.

ITA No.3863/Chny/2025 & :-2-: SA. No.10/Chny/2026 2. Brief facts of the case are that the assessee is an individual, a registered stamp vendor under the Tamil Nadu State and has filed her return of income on 23.08.2017 for AY 2017-18, declaring total income of Rs.2,73,081/-. The case was selected for scrutiny under CASS for ‘Complete Scrutiny category’ for verification of cash deposited to the tune of Rs.27,63,000/- to her bank account with SBI and amount of Rs.8,32,500/- to her bank account with Bank of Baroda. The AO was issued statutory notices to the assessee by calling for details. In response, the assessee filed her reply along with supporting documents except cash book for consideration. In the meanwhile, the AO issued notices u/s.133(6) of the Act to obtain statement of accounts from the banks including particulars of denomination cash deposited to the bank during the period. On verification of the ROI and reply submitted by the assessee and statement of account received from Bank of Baroda, the AO noticed that the total stamp paper purchased and sold from 01.04.2016 to 10.11.2016 nullifies the cash balance and hence the closing cash in hand was Rs.NIL and the assessee had deposited Rs.12,04,000/- on 10.11.2016, since the assessee had not produced the cash book for verification, the source for the above could not be ascertained. Further, the AO issued notice to the assessee to furnish the cash book for the relevant period for verification. Since, the assessee failed to respond the notice, the AO completed the assessment by passing an order u/s.143(3) of the Act dated 31.12.2019 by making an addition of Rs.30,69,950/- as income from other sources u/s.69A of the Act.

3.

Aggrieved by the order of the AO, the assessee preferred an appeal before the ld.CIT(A) on 20.01.2020.

4.

At the outset, we observed that ld.CIT(A) has issued various notices to the assessee to appear for hearings order to support the appeal of the assessee. However, the assessee chose to be silent and did not submit cash book for verification before the ld.CIT(A) also and hence the ld.CIT(A) dismissed the appeal filed by the assessee by confirming the order of the AO by passing

ITA No.3863/Chny/2025 & :-3-: SA. No.10/Chny/2026 an order dated 26.11.2025. Aggrieved by the order of the ld.CIT(A), the assessee preferred an appeal before us.

5.

The ld.AR submitted that the ld.CIT(A) erred in not considering the facts and grounds raised by the assessee and the submissions filed during the course of the assessment proceedings. Further ld.AR filed a paper book consisting of 346 pages containing replies filed before the authorities, stock details of stamp papers and commission earned, written submissions, Chart showing the receipts during the demonetisation period, Cash book, bank statements along with the judicial precedents relied on in support of the grounds of appeal filed. Further, the ld.AR brought to our attention that the authorities have not considered the cash book filed during the proceedings. In view of the above, the ld.AR prayed to set aside the order of ld.CIT(A) and remit the issues back to the file of AO for verification of cash book and bank book furnished and decided the issue afresh. Further, ld.AR assured the bench that the ld.AR will represent on behalf of the assessee before the AO to complete the assessment proceedings effectively.

6.

Per contra, the ld.DR submitted the ld.CIT(A) provided sufficient opportunity to appear before them. However, the assessee has submitted only partial details and hence there is no errors / faults in the orders of the authorities and prayed for confirming the order of the ld.CIT(A).

7.

We have heard the rival submissions and perused the material available on record including the paper book filed by the assessee. We find that the assessee is a registered stamp vendor and had deposited cash in her bank accounts during the demonetisation period. The AO made addition u/s.69A of the Act mainly on the ground that the assessee failed to produce the cash book for verification during the course of assessment proceedings. We further observe that though the ld.CIT(A) had granted sufficient opportunities to the

ITA No.3863/Chny/2025 & :-4-: SA. No.10/Chny/2026 assessee, the assessee did not effectively prosecute the appeal and consequently the ld.CIT(A) confirmed the addition made by the AO.

8.

Before us, the ld.AR has filed a detailed paper book containing, inter alia, the cash book, bank statements, stock details of stamp papers purchased and sold, commission details and written submissions. The ld.AR submitted that the cash deposits were out of business receipts generated from stamp vending activity and pleaded that the cash book and bank book now furnished may be verified by the AO. The ld.AR also undertook to fully cooperate in the remand proceedings and ensure proper representation before the AO.

9.

Considering the facts and circumstances of the case, and in the interest of substantial justice, we are of the considered opinion that the issue requires fresh verification at the end of the AO. Since the additions have been made primarily for non-production of the cash book and related records, and the assessee has now placed the relevant books and supporting documents before the Tribunal, we deem it fit and proper to set aside the orders of the lower authorities on this issue and remit the matter back to the file of the AO for de novo examination. 10. Accordingly, the AO is directed to verify the cash book, bank book, bank statements and other supporting records furnished by the assessee, examine the source of cash deposits made during the relevant period and thereafter decide the issue afresh in accordance with law after affording adequate opportunity of being heard to the assessee. The assessee is also directed to promptly furnish all details and cooperate with the assessment proceedings without seeking unnecessary adjournments.

11.

Since we have already adjudicated the appeal of the assessee on merits, nothing survives in the stay application. Accordingly, the stay application stands dismissed as infructuous.

ITA No.3863/Chny/2025 & :-5-: SA. No.10/Chny/2026 12. In the result, appeal filed by the assessee is allowed for statistical purposes and stay application of the assessee is dismissed.

Order pronounced in the open court on 02nd June, 2026 at Chennai.

Sd/- Sd/- (एस एस विश्वनेत्र रवि) (एस. आर. रघुनाथा) (S. R. RAGHUNATHA) (S.S. VISWANETHRA RAVI) लेखा सदस्य/Accountant Member न्याविक सदस्य/Judicial Member

चेन्नई/Chennai, वदनांक/Dated, the 02nd June, 2026. *Devadas आदेश की प्रतिलिपि अग्रेपिि/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3.आयकर आयुक्त/CIT– Chennai/Coimbatore/Madurai/Salem 4. ववभागीय प्रनतननधि/DR 5. गार्ा फाईल/GF DEVADAS Digitally signed by DEVADAS GOPALANACHARY GOPALANACHARY Date: 2026.06.08 15:57:24 +05'30'

More judgments on Section 69A

All 15,297 judgments and leading authorities on Section 69A →

Recent GST High Court judgments

Search GST case law →