VELLAIKANNU RAJAGOUNDER SUBRAMANIAM,VELLORE vs. ITO, WARD-3,, VELLORE

This appeal filed by the assessee is directed against the order dated 21.06.2024 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi for the assessment year 2017-18.

We find that this appeal is filed with a delay of 248 days. The assessee filed an affidavit for condonation of delay stating the reasons. Upon hearing both the parties and on examination of the said affidavit, we find the reasons stated by the assessee are bonafide, which really prevented in filing the appeal in time. Thus, the delay is condoned and admitted the appeal for adjudication.

The assessee raised 4 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the ld. CIT(A) is justified in confirming the addition made under section 69A of the Income Tax Act, 1961 [“Act” in short] in the facts and circumstances of the case.

We note that according to the Assessing Officer, the assessee made cash deposits of ₹.4,75,000/- in State Bank of India, SME Branch and ₹.12,71,000/- in HDFC Bank Gandhi Nagar Branch during demonetization period and did not file return of income for AY 2017-18. Thus, the Assessing Officer issued notice under section 142(1) of the Act dated 17.01.2018 requiring the assessee to file return of income, but, however, the assessee did not comply with the same. However, in response to the notice under section 142(1) of the Act, the assessee filed return of income on 22.08.2018 after the expiry of time stipulated in the notice and thus, the Assessing Officer treated the ROI as invalid. After examining the bank statement obtained under section 133(6) of the Act, the Assessing Officer extracted the details of cash deposit made by the assessee at page 3 & 4 of the assessment order. The Assessing Officer issued summon under section 131 of the Act on 06.08.2019 and recorded sworn statement. In the sworn statement, the assessee explained the source for cash deposits of ₹.17,46,000/- made during demonetization period and the same is extracted at page 5 of the assessment order. In the absence of documentary evidence for the source of cash deposits made by the assessee, production of sales bills, etc., the Assessing Officer treated the entire cash deposits of ₹.17,96,000/- unexplained cash deposits under section 69A r.w.s. 115BBE of the Act and added to the total income of the assessee and completed the assessment under section 144 of the Act dated 26.11.2019. On appeal, the ld. CIT(A) dismissed the appeal of the assessee since the assessee did not comply with the hearing notices or filed any documentary evidences in support of grounds of appeal.