SHAFIULLAH SIDDIQUI,AZAMGARH vs. INCOME TAX OFFICER, WARD - 3(2), AZAMGARH

IN THE INCOME TAX APPELLATE TRIBUNAL CIRCUIT BENCH (SMC), VARANASI BEFORE SHRI. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA No.47/VNS/2025 Assessment Year: 2012-13 Shafiullah Siddiqui v. The Income Tax Officer 108-A, Sadawari Ward 3(2) Athwariya Sadar Azamgarh Azamgarh (U.P) TAN/PAN:HQDPS8899M (Applicant) (Respondent) Applicant by: None Respondent by: Shri Sudipta Paul, D.R. O R D E R This appeal has been preferred by the Assessee against the order dated 17.01.2025, passed by the Addl/JCIT(A)-11, Delhi for Assessment Year 2012-13.

2.0 The brief facts of the case are that the assessee had not filed the return of income for the year under consideration. The Income Tax Department was in possession of the information that during the year under consideration, the assessee had made cash deposits amounting to Rs.16,00,000/- in his Saving Bank Account. The AO initiated reassessment proceedings under Section 147 of the Income Tax Act, 1961 (hereinafter called 'the Act’) upon issuance of notice under Section 148 of the Act. In response to notice under section 148 of the Act, no return of income was, however, filed by the assessee. However, he

ITA No.47/VNS/2025 Page 2 of 6 submitted that the cash deposits in the Bank Account were from sale of ancestral property, but no evidence of sale of property was furnished before the AO. Thereafter, the AO issued statutory notices under section 142(1) of the Act, requiring the assessee to furnish the details of sale of ancestral property, etc. However, the assessee did not respond to the notices issued by the AO. The AO, therefore, proceeded to complete the assessment on the basis of Best Judgment Assessment. Since the assessee could not offer any satisfactory explanation about the nature and source of the cash deposits made by him in his Bank Account, the AO treated the same as unexplained money and added Rs.16,25,000/- to the total income of the assessee under section 69A of the Act.

2.1 The AO further noticed that there was a credit of Rs.11,503/- in his Saving Bank Account being interest, which was also added to the total income of the assessee.

2.2 The AO completed the assessment under section 144 read with section 147 of the Act, assessing the total income of the assessee at Rs.16,36,500/-.

2.3 The AO also initiated penalty proceedings under section 271(1)(b) and 271(1)(c) of the Act, separately.

2.4 Aggrieved, the Assessee preferred an appeal before the NFAC, which dismissed the appeal of the assessee in limine for

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the reason of there being a delay in filing the appeal before the Ld. First Appellate Authority and confirmed the order of the AO.

2.5 Now the assessee has approached this Tribunal challenging the order of the NFAC, by raising the following grounds of appeal:

10.1 On the Basis of facts and circumstances of the case, the learned Assessing Officer has grossly erred in making addition of Cash taken Against Sales of Agricultural Land as Unexplained Money u/s 69A. 10.2 On the Basis of facts and under the circumstances of the case and in law the learned AO erred in making addition of Rs.16,25,000/- u/s 69A without appreciating the fact that the appellant had deposited cash in the bank account was out of the sale proceeds of agricultural land, which is exempt from capital gains tax under Section 10(37) of the Income Tax Act, 1961. 10.3 That the Ld. AO has wrongly treated the cash deposit as unexplained income under Section 69A, despite the fact that the transaction was related to the sale of agricultural land, which is not taxable under the Act. 10.4 That the Ld. AO erred in not granting sufficient opportunity to the assessee to submit the required documentary evidence and passed the order in violation of the principles of natural justice. 10.5 That the Ld. AO erred in making an addition merely based on assumptions and surmises without conducting proper verification or inquiry into the genuineness of the source of cash deposits.

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10.6 That the Ld. AO erred in rejecting the assessee's claim without duly considering the evidences available, such as the sale deed of agricultural land and the corresponding bank deposit records.

10.7 That the Ld. AO ought to have considered the fact that agricultural land, being outside the definition of capital assets under Section 2(14) of the Act, does not attract capital gains tax, and therefore, the cash deposit from such sale cannot be considered as undisclosed income. 10.8 That without prejudice to the above, the Ld. AO has made an arbitrary and excessive addition, which is not in accordance with the provisions of the Income Tax Act, 1961. 10.9 That the appellant craves leave to add, amend, alter, or modify any of the above grounds of appeal before or at the time of hearing. 3.0 None was present on behalf of the assessee when the appeal was called out for hearing nor was any adjournment application moved in this regard. However, looking into the facts of the case, I proceed to adjudicate the appeal based on record before us.

4.0 The Ld. Sr. D.R. placed reliance on the orders of the authorities below and submitted that the appeal of the assessee may be dismissed.

5.0 I have heard the Ld. Sr. D.R. and have also perused the material on record. Looking into the facts of this case, I am of the

ITA No.47/VNS/2025 Page 5 of 6 considered view that the assessee deserves one more opportunity to present his case and, therefore, in the interest of substantial justice, I restore this file to the Office of the ld. Addl/JCIT(A)-11, Delhi with the direction to give an opportunity to the assessee to explain the initial delay in filing the first appeal and thereafter, if deemed appropriate, condone the delay and admit the appeal to be heard on merits and adjudicate in accordance with law after providing an opportunity of hearing to the assessee to present his case. I also caution the assessee to fully comply with the directions of the ld. Addl/JCIT(A)-11, Delhi in the set-aside proceedings when called upon to do so, failing which, the ld. Addl/JCIT(A)-11, Delhi would be at complete liberty to pass the order in accordance with law, based on material available on record even if it is ex-parte qua the assessee.

6.0 In the result, the appeal of the assessee stands allowed for statistical purposes.

Order pronounced in the open Court on 21/08/2026.

Sd/- [SUDHANSHU SRIVASTAVA] JUDICIAL MEMBER DATED:21/08/2026 JJ:

ITA No.47/VNS/2025 Page 6 of 6 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR By order

Assistant Registrar/DDO