DINESH SOAPS AND DETERGENTS ,KANPUR vs. THE ASSISTANT COMMISSIONER OF INCOME TAX , KANPUR

ITA 669/LKW/2025Status: DisposedITAT Lucknow24 September 2026AY 2017-1810 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal considered the facts and arguments. It noted that the additions made by the AO were primarily due to the assessee's failure to make proper compliances. The assessee's explanation for this failure was the disorientation caused by multiple family deaths, including the death of their only son, which affected their business and legal compliances. The Tribunal found this to be a fit case for admitting additional evidence to allow the AO to consider all material before deciding on the additions. In the interest of justice, the Tribunal restored the matter to the file of the AO with a direction to the assessee to furnish all necessary documents and books of accounts. The AO was directed to consider the submitted material and pass a fresh assessment order. The appeal was allowed for statistical purposes. The Tribunal did not decide on the specific additions made by the AO, as the matter was remanded.

What were the facts?

The assessee, Dinesh Soaps and Detergents, filed an appeal against the order of the CIT(A), NFAC, which dismissed the assessee's appeal against the Assessing Officer's (AO) order for Assessment Year 2017-18. The AO had passed an order under Section 143(3) on December 6, 2019. The assessee's return declared a total loss of Rs. 3,36,83,327. The case was selected for scrutiny. The AO noted non-compliance with notices and issued a show-cause notice, to which the assessee failed to reply. Subsequently, a reply was received via e-portal regarding cash deposits during demonetization, along with bank statements and VAT returns. However, the stock register was not furnished. The AO proceeded under Section 144, making additions including Rs. 70,64,294 as unexplained cash credit under Section 68, disallowing Rs. 4,69,990 under Section 40(a)(ia) for non-deposit of TDS, and other additions. The CIT(A) dismissed the appeal, upholding the AO's additions.

What were the issues?

1. Whether the CIT(A) erred in not admitting additional evidence filed by the appellant under Rule 46A of the Income-tax Rules, 1962, thereby violating principles of natural justice (Question of law and fact, relying on Rule 46A). 2. Whether the CIT(A) erred in upholding the best judgment assessment passed under Section 144 without judiciously considering available financial information (Question of law and fact). 3. Whether the CIT(A) erred in confirming the addition of Rs. 70,64,294 under Section 68, when the source of capital was explained through banking sources, and further, if warranted, such addition should be in the hands of partners (Question of law and fact, relying on Section 68). 4. Whether the CIT(A) erred in confirming the addition of Rs. 71,44,015 under Section 68, considering the loans were genuine from identifiable parties (Question of law and fact, relying on Section 68). 5. Whether the CIT(A) erred in confirming the addition of Rs. 5,54,90,000 under Section 68, failing to consider the explanation that cash deposited was from business cash-in-hand (Question of law and fact, relying on Section 68). 6. Whether the CIT(A) erred in confirming an addition under Section 68 for cash deposited into a bank account, as a bank account is not 'books of an assessee' (Question of law, relying on Section 68). 7. Whether the CIT(A) erred in confirming the application of Section 115BBE, as conditions for Section 68 were not met (Question of law, relying on Section 115BBE and Section 68). 8. Whether the CIT(A) erred in sustaining the addition of Rs. 22,92,541 for a difference in a creditor's confirmation without providing an opportunity to reconcile or cross-examine (Question of law and fact). 9. Whether the CIT(A) erred in confirming the disallowance under Section 43B of Rs. 1,43,38 relating to TDS payable, as it was a liability and not claimed as expenditure (Question of law, relying on Section 43B). 10. Whether the CIT(A) erred in confirming consequential interest under Sections 234A, 234B, and 234C (Question of law, relying on Sections 234A, 234B, 234C). Assessee's Contentions: The assessee argued that the CIT(A) failed to consider the impact of personal tragedies (death of son and mother/mother-in-law) which prevented them from making compliances. They claimed sufficient cause and that death certificates should not be insisted upon as a procedural formality. The assessee prayed for the matter to be restored to the AO. The assessee relied on the fact that death certificates were now on record. Revenue's Contentions: The revenue argued that the assessee was obliged to file death certificates to prove reasonable cause. They submitted that there was no infirmity in the CIT(A)'s order in refusing additional evidence without them. However, the revenue stated they would not object to the matter being restored if directions were issued for necessary compliances.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144,Section 68,Section 40(a)(ia),Section 43B,Section 115BBE,Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, LUCKNOW ‘B’ BENCH, LUCKNOW

Hearing: 12.08.2026Pronounced: 24.09.2026

PER NIKHIL CHOUDHARY, A.M.: This is an appeal filed by the assessee against the order of the ld. CIT(A), NFAC dated 21.08.2025, wherein the ld. CIT(A) has dismissed the appeal of the assessee against the order passed by the ld. Assessing Officer for the assessment year 2017-18, passed under section 143(3) of the Income Tax Act, 1961 on 6.12.2019. The grounds of appeal are as under:- “A. Because, on the facts and circumstances of the case and in law, the Ld. CIT(A) has passed an order dated 21.08.2025 which is erroneous, bad in law, and contrary to the principles of natural justice. B. Because, on the facts and circumstances of the case and in law, the Ld. CIT[A] has erred by not admitting the additional evidence filed by t

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 68

All 29,931 judgments and leading authorities on Section 68 →

Recent GST High Court judgments

Search GST case law →