SINGAL PIPE FITTINGS (P) LTD.,HOWRAH vs. I.T.O., WARD - 13(1),, KOLKATA

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ITA 2999/KOL/2025Status: DisposedITAT Kolkata30 June 2026AY 2017-20186 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal noted that the assessee had withdrawn money from its bank account earlier. Considering the facts and in the interest of justice, the Tribunal confirmed Rs. 5,00,000/- out of the total addition and granted relief of Rs. 26,00,000/-.

What were the facts?

The assessee deposited Rs. 31,00,000/- in cash during the demonetization period, claiming it was withdrawn earlier and held as cash. The Assessing Officer (AO) made an addition of Rs. 31,00,000/- under Section 69A as the explanation for holding cash was not satisfactory.

What were the issues?

Whether the addition made by the AO on account of unexplained cash deposits under Section 69A was justified, and whether the assessment was valid based on the notice issued under Section 143(2).

Which sections of the Income-tax Act were involved?

Section 69A,Section 143(2),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, KOLKATA

Hearing: 16.06.2026Pronounced: 30.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA No. 2999/KOL/2025 Assessment Year : 2017-2018

Single Pipe Fittings (P) Ltd., Vs. ITO, Ward 13(1), Tirupati Apartment, 322, G.T. Kolkata, Road, Belur, Howrah - 711202 110, Santipally, Aayakar [PAN: AAMCS1508C] Bhawan (Poorva), Kolkata - 700107 APPELLANT RESPONDENT

Assessee by : Manoj Kataruka, AR Revenue by : Sanjit Kumar Das, CIT-DR

Date of hearing : 16.06.2026 Date of Pronouncement : 30.06.2026

O R D E R This is an appeal filed by the assessee against the order passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “the Ld. CIT(A)] dated 18.02.2025, DIN & order No. ITBA/NFAC/S/250/2024- 25/1073423873(1) on the following grounds of appeal:

“1. That on the facts and in the circumstances of the case the action of the Ld. CIT(A) lo uphold the action of the AO in making addition of Rs. 31.00.000/-on account of cash deposit u/s 69A of the Act is contrary to the material evidences on record is erroneous arbitrary, excessive and illegal

2 ITA No. 2999/KOL/2025 Singal Pipe Fittings (P) Ltd. 2) That the order passed by the A. O and upheld by the CIT(A) was arbitrary excessive and illegal 3) That the above grounds of appeal will be argued in detail at the time of hearing and the appellant crave leave to submit additional grounds of appeal if any and/or alter verify, modify or rectify any grounds of appeal at or before the time of hearing Additional Ground of Appeal: - 1) That on the facts and in the circumstances of the case the action of the AO to frame assessment on basis of an invalid notice issued u/s 143(2) renders the assessment framed as invalid and bad in law. 2) The aforesaid ground of appeal raised is purely legal issue which goes to the root of the matter and the same does not require any fresh investigation into the fact facts already being on record Further the omission to raise the additional grounds is neither willful nor intentional In view of the above, the aforesaid additional grounds may kindly be admitted and adjudicated while hearing the appeal filed by the assessee. 2. Briefly stated the facts of the case are that the assessee filed return of income on 01.09.2017 declaring income at Rs. 2,71,452/-. The case was selected for scrutiny under CASS with the ‘Complete Category’. Accordingly, notice u/s 143(2) and 142(1) of the Act was issued to the assessee. Subsequently, other statutory notice issued to the assessee. On perusal of the record, it was noted that in the month of April, 2016, the assessee deposited cash of Rs. 30,00,000/- in its bank account and it was claimed by the assessee that Rs. 30,00,000/- withdrawn from bank in the month of April, 2016 and the assessee re-deposited which were laying as cash in hand amounting to Rs. 31,00,000/- during the month of November, 2016 in different dates. But the assessee failed to explain the reason for withdrawal and holding the same till the month of November and the business activity does not support the cash withdrawal. The AO further noted that the assessee does not have any

3 ITA No. 2999/KOL/2025 Singal Pipe Fittings (P) Ltd. explanation in respect of the deposit in SBN’s (Specified Bank Notes) and he doubted on the explanation submitted by the assessee. Accordingly, he made addition of Rs. 31,00,000/- observing that the cash withdrawal in the month of April 2016 cannot be kept up to November, 2016 in physical form and made addition u/s 69A of the Act.

3.

Aggrieved from the above order, the assessee filed appeal before the Ld. CIT(A) observed that it is settled law that where the assessee fails to discharge the onus by producing with cogent evidences and explanation, the AO would be justified in making the addition back to the income of the assessee as held in Kalekhan Mohammad Hanif Vs. CIT (1963) 50 ITR (SC) and Roshan D Hatti Vs. CIT (1997) 107 ITR 93 (SC) and dismissed the appeal of the assessee.

4.

Aggrieved from the above order, the assessee filed appeal before ITAT.

5.

The Ld. Counsel reiterated the submission made before the lower authorities and submitted that the assessee withdrawn money in the month of April 2016 which was kept and re-deposited therefore, he has accepted that assessee withdrawn cash from bank in the Month of April 2016. He furnished cash summary and he also referred that there is no doubt that the case was withdrawn in the month of April, 2016 and there is no any huge expenditure incurred by the assessee therefore, the case

4 ITA No. 2999/KOL/2025 Singal Pipe Fittings (P) Ltd. was lying ideal which were re-deposited. The Ld. Dr supported the order of the lower authorities.

6.

Considering the rival submission, I noted that the case was selected for the reason that the assessee deposited cash of Rs. 31,00,000/- during demonetisation period. In fact, the assessee has withdrawn money from its bank account of Rs. 30,00,000/- in the month of April, 2016. On perusal of the financial statement, it is noted that the total revenue from operation is Rs. 9,77,510/- and the total expenditure is Rs. 706,058/- and which is a complete cash expenditure. Accordingly, there is surplus of Rs. 2,71,452/- and no any cash expenditure incurred by the assessee, the financial result shown by the assessee has been accepted by the revenue. It is also noted that in the month of December, the assessee has withdrawn of Rs. 1,00,000/- and in the month of March there is cash withdrawal of Rs. 50,000/- on 28.03.2017 the cash was deposited by the assessee.

Date Rs.

19.11.2016 8,00,000/-

21.11.2016 2,00,000/-

21.11.2016 7,00,000

22.11.2016 5,00,000/-

5 ITA No. 2999/KOL/2025 Singal Pipe Fittings (P) Ltd.

22.11.2016 3,00,000/-

23.11.2016 6,00,000/-

7.

There is a cash withdrawal on 01.12.2016 of Rs. 50,000/- and on 07.11.2016 Rs. 50,000/-. I also noted after the cash deposit during demonetisation there is no substantial withdrawal are transferred into any other bank account after deposit in SBN’S except the withdrawal of Rs. 1,00,000/- in cash in the month of December it proved that the money withdrawal earlier was allowing with the money belongs to the assessee.

8.

Considering the facts of the case and in the interest of justice and to meet the end of justice with the consent of both the parties a sum of Rs. 5,00,000/- is confirmed out of the total addition of Rs. 31,00,000/- made by the AO and assessee gets relief of Rs. 26,00,000/-.

9.

In the result, appeal of the assessee is partly allowed.

Order pronounced on 30.06.2026.

Sd/- (Laxmi Prasad Sahu) Accountant Member Dated: 30.06.2026 AK, Sr. P.S.

6 ITA No. 2999/KOL/2025 Singal Pipe Fittings (P) Ltd. Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR)

//True copy// By order

Assistant Registrar, Kolkata Benches

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