NAHAR FINANCE & LEASING LTD ,CHENNAI vs. CORPORATE WARD 4(2), CHENNAI

Brief facts of the case are that the assessee filed its return of income for the assessment year 2017-18 on 19.01.2018 admitting total income of ₹.57,570/-. As per the information with the Department, the assessee company had huge cash deposits in various bank accounts during the demonetization period of financial year 2016-17 relevant to the assessment year 2017-18. On perusal of the return of income, the Assessing Officer has noticed that the cash deposits made of ₹.29,71,000/- exceeds the total turnover of ₹.14,65,886/- which was shown in ITR. Accordingly, after issuing various notices and obtaining bank statement from Indian Bank under section 133(6) of the Act, the Assessing Officer has completed the assessment under section 143(3) r.w.s. 147 of the Act dated 21.11.2019 by making addition of unexplained deposit in the bank account of ₹.29,71,000/- under section 69A of the Act. On appeal, since the assessee failed to offer any explanation about the nature and source of the cash deposit amounting to ₹.29,71,000/-, the ld. CIT(A) confirmed the addition made by the Assessing Officer.

On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the ld. CIT(A) has failed to provide an opportunity to the assessee before passing the order. It was further submission that the appeal was suddenly converted to faceless and no communication was received by the assessee besides raising grounds on merits, the ld. Counsel has submitted that the assessee the assessee may be given one more opportunity to present its case before the ld. CIT(A) on merits.

On the other hand, the ld. DR supported the orders of authorities below.

We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. On perusal of the appellate order at para 4.1, wherein, the ld. CIT(A) has mentioned that notices under section 250 of the Act were issued through ITBA portal to the assessee on five occasions. However, the contention of the assessee is that the appeal was suddenly converted to Faceless and no communication was received by it. Under the above facts and circumstances of the case, we are of the considered opinion that to meet the ends of natural justice, assessee may be given one more opportunity of being heard to present its case before the ld. CIT(A). Accordingly, we set aside the appellate order and remit the matter back to the file of the ld. CIT(A) to afford one more opportunity of being heard to the assessee to present its case on merits.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on the 30th August, 2022 in Chennai.