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Facts
The assessee, an individual engaged in gold and silver trading and gold loans, failed to file his return of income. Information revealed a cash deposit of Rs. 63,23,651/- in his bank account, which remained unexplained. The Assessing Officer (AO) made an addition of this amount as unexplained money, initiated penalty proceedings, and charged interest.
Held
The Tribunal noted that the appeal was filed belatedly. While the assessee's non-compliance in prior proceedings was acknowledged, the Tribunal decided to give the assessee one more opportunity to present his case before the first appellate authority for de novo adjudication, adhering to the principles of natural justice.
Key Issues
Whether the assessee should be granted another opportunity to present their case before the first appellate authority despite prior non-compliance, and whether the addition of unexplained cash deposits is justified.
Sections Cited
250, 147, 69A, 115BBE, 139(1), 148, 143(2), 142(1), 144B, 271AAC(T), 234A, 234IJ, 234F
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, MUMBAI
(Assessment Year: 2018-19) Anup Ajay Dandapat ITO Ward 4(1), Thane Flat No. 5/2, New Arihant Society, Ashar IT Park, Neheru Nagar, Wagle Panchal Nagar, Near Olympic Hotel, Industrial Estate, Thane West – Vs. Nallasopara West, Maharashtra – 400604. 401203. PAN/GIR No. AGPPD2112H (Appellant) : (Respondent) Assessee by : Shri. Bhupendra Shah Respondent by : Shri. Ram Krishn Kedia, (SR. DR.) Date of Hearing : 13.03.2025 Date of Pronouncement : 30.04.2025 O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) Delhi (‘ld. CIT(A)’ for short), National Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2018-19.
It is observed that this appeal has been filed belatedly with a delay of 117 days beyond the period of limitation for which the assessee had filed an affidavit for condoning the said delay. On perusal of the same, we deem it fit to hold that the assessee had ‘sufficient cause’ for the delay and we therefore condone the delay caused in filing the present appeal.
(A.Y. 2018 -19) Anup Ajay Dandapat 3. The assessee has raised the following grounds of appeal:
1. In the facts and the circumstances of the case and in law, the learned A.O. erred in passing the order u/s 147 without attending personal hearing through video conferencing and only relying on the information available without making any inquiry thereby not following the principles of natural justice
2. In the facts of the case and in Law, the learned AO erred in making addition of Rs. 63,23,651/-by arbitrarily adding cash deposit made in bank account as unexplained money u/s 69A r.w.s 115BBE thereby a. Disregarding the fact that the cash deposit were out of the sums received from his customers to whom loan were given by the Appellant against their gold ornaments. b. Without appreciating the fact that business of lending loan against gold can be carried out by the Appellant without any license. c. Disregarding the fact that the Appellant is not liable to maintain books of accounts and therefore section 69A is not applicable. d. Arbitrarily rejecting details of cash deposits even though each and every details was submitted about the source and nature of receipt including confirmation of accounts of 3 parties and the applicable income is duly shown in the return of income.
3. In the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (A) erred in confirming the same additions.
4. In the facts and circumstances of the case and in law, the learned A.O. erred in levying interest u/s 234A, B, C and D & initiating penalty u/s 271AAC[1]. [B] Relief Prayed: The Appellant therefore prays follows,
1. To quash the order passed u/s 147.
2. To delete the addition of Rs. 63,23,651/- made u/s 69A r.w.s 115BBE under the head income from other sources without appreciating the details filed.
3. To delete the disallowance interest u/s 234A, B, C and D & initiation of penalty u/s 271AAC(1) [C] General
1. The appellant reserves rights to add alter or delete any portion of this appeal before its conclusion.
(A.Y. 2018 -19) Anup Ajay Dandapat 2. This appeal is filed late and an application for condonation of delay is filed along with the appeal.
A Detailed paper book along with case laws will be submitted at the time of hearing.”
Brief facts of the case are that the assessee an individual doing business in trade name of Somen Sonakar and engaged in retail trading of gold and silver & business of gold loan. The assessee had not filed his return of income u/s. 139(1) of the Act, for the year under consideration. The assessee’s case was selected for scrutiny based on the information available with the department, where it was found that the assessee had deposited cash of Rs. 63,23,651/- in his bank account maintained with The Catholic Syrian Bank Ltd. during the F.Y. 2017-18 relevant to A.Y. 2018-19, where the nature and source of above cash deposit remained unexplained. The assessee was served with notice u/s. 148, dated 05.04.2022 and in response to the same, the assessee had filed his return of income dated 13.04.2022, declaring total income at Rs. 4,01,011/-, after claiming deduction under Chapter VI-A at Rs. 40,599/-. Notices u/s. 143(2) and 142(1) of the Act were duly issued and served upon the assessee. As the assessee failed to furnish the complete details/information as required vide statutory notices issued by the ld. AO, inspite of several opportunities, the ld. AO passed the assessment order u/s. 147 r.w.s. 144B of the Act, dated 01.03.2024, determining the total income at Rs. 66,84,061/- after making an addition of Rs. 63,23,651 as unexplained money u/s. 69A of the Act, under the normal provisions as well as u/s. 115BBE of the Act. The ld. AO also initiated penalty u/s 271AAC(T) and charged interest u/s 234A, 234IJ and 234F.
Aggrieved the assessee was in appeal before the first appellate authority, challenging the assessment order.
(A.Y. 2018 -19) Anup Ajay Dandapat 6. The ld. CIT(A) vide an ex parte order dated 29.07.2024, upheld the order of the ld. A.O. for the reason that inspite of several opportunities, the assessee has failed to substantiate his claim and has been non-compliant throughout the appellate proceedings.
The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A).
The learned Authorised Representative ('ld. AR' for short) for the assessee contended that the assessee has already taken on record the fact that the said amount was received from his customers to whom loan were given by the assessee against their gold ornaments. The ld. AR further contended that the assessee has got a good case on the merits and prayed that the assessee may be given one more opportunity to present his case before the ld. CIT(A).
The learned Departmental Representative ('ld. DR' for short) vehemently opposed to setting aside the issue to the file of the ld. CIT(A) for the reason that the assessee was given several opportunities by the ld. CIT(A) which was not availed by the assessee. The ld. DR relied on the order of the lower authorities.
We have heard the rival submissions and perused the materials available on record. It is observed that the assessee has challenged the addition made by the ld. A.O. before the first appellate authority but has been non-compliant throughout the appellate proceeding.