Loading judgment…
Facts
The assessee filed its return of income at Nil for Assessment Year 2020-21. The case was selected for limited scrutiny to examine unsecured loans. The Assessing Officer made an addition of Rs. 62,75,386/- under Section 68 as unexplained cash credit, as the assessee failed to provide explanations and documentary evidence for a loan from M/s. Ezeego One Travels and Tours Limited. The assessee's appeal before the CIT(A) was dismissed for non-prosecution.
Held
The Tribunal condoned the delay in filing the appeal and noted that the assessee had submitted a paper book with documentary evidence. Considering the facts, the Tribunal decided to remit the matter back to the CIT(A) for a fresh adjudication.
Key Issues
Whether the addition of an unsecured loan as unexplained cash credit under Section 68 was justified when the assessee claimed to have provided details, and whether the appeal should be remitted to the CIT(A) for a de novo adjudication after dismissing the first appeal for non-prosecution.
Sections Cited
143(3), 144B, 68, 133(6), 234A, 234B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH MUMBAI
Before: SHRI SAKTIJIT DEY, HONBLE & SHRI GIRISH AGRAWAL
O R D E R
PER GIRISH AGRAWAL, ACCOUNTANT MEMBER:
This appeal filed by the assessee is against the order of Ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, vide order no. ITBA/NFAC/S/250/2024-25/1071546520(1), dated 24.12.2024, passed against the assessment order by Assessment Unit, Income Tax Department, Mumbai u/s. 143(3) r.w.s.144B of the Income-tax Act, 1961 (hereinafter referred to as the “Act”), dated 22.08.2022, for Assessment Year 2020-21.
Grounds taken by the assessee are reproduced as under: (1) The Learned Assessing Officer erred in making an addition of Rs.62,75,386 under Section 68 considering the Loan as Unexplained cash credit despite the Appellant providing all the available details necessary for the matter and overlooking the request made by the Appellant for Video Conferencing for explaining the matter.
Allknown Marketers Pvt. Ltd. Assessment Year 2020-21 (2) On the facts and in the circumstances of the case and in law, the AO erred in charging of Interest of Rs.1,41,606/- u/s.234A. (3) On the facts and in the circumstances of the case and in law, the AO erred in charging of Interest of Rs.13,68,858/- u/s. 234B. (4) On the facts and in the circumstances of the case and in law, the AO erred in charging of Interest of Rs.14,833/- u/s.234B.
There is a delay of 35 days in filing the present appeal before the Tribunal for which petition for condonation of delay along with affidavit is placed on record. In the affidavit Assessee has given the reason for this delay that its director was in the process of shifting out of India for professional/personal reasons because of which order received on email remained to be accessed. We have perused the material placed on record and having considered the same, find it appropriate to condone the delay and take up the matter for adjudication.
From the perusal of the impugned assessment order, it is noted that assessee filed its return of income on 06.01.2021 reporting total income at Nil. The reason for selection of the case for limited scrutiny was to examine unsecured loans received by the assessee. Assessee had taken unsecured loan of Rs.62,75,386/- from M/s. Ezeego One Travels and Tours Limited for which learned Assessing Officer called for relevant explanation and documentary evidence. There was no submission by the assessee on this account. Learned AO also issued notice u/s.133(6) of the Act to the loan creditor for which also there was no response. Since, the assessee failed to furnish the confirmation letter from the creditors and other documentary evidence despite several opportunities provided by the Learned AO, assessment was completed by treating the said loan as unexplained cash credit u/s.68 of the Act to make the addition. Assessee preferred appeal before the CIT(A), before whom also no compliances were made. The first appeal was dismissed for non- prosecution. Aggrieved, assessee is in appeal before the Tribunal.
Before us, learned Counsel for the assessee reiterated the above stated facts and took us through the affidavit explaining non-appearance Allknown Marketers Pvt. Ltd. Assessment Year 2020-21 before the learned CIT(A) placed in the paper book. He also referred to the paper book containing 158 pages whereby all the documentary evidences in respect of unsecured loan from the said lender are placed on record.
We have heard both the parties and perused the material on record. Considering the factual matrix, in the interest of justice and fair play, we find it appropriate to remit the matter back to the file of ld. CIT(A) for denovo adjudication of the grounds raised at the first appellate stage by the assessee after considering submissions of the assessee for which necessary opportunities may be given. Also, assessee be given reasonable opportunity of being heard to make any further submissions, if so required. We also direct the assessee to be diligent in attending the hearing fixed for adjudication of the appeal and make necessary compliance to substantiate the claim so made. Assessee should not seek adjournment unless warranted by compelling reasons. Accordingly, grounds raised by the assessee are allowed for statistical purposes
In the result, appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open court on 26 August, 2025