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Facts
The assessee, Nandan Live Stock Development Cooperative Society, filed a NIL return for AY 2017-18, claiming exemption under Section 80P(2)(19). During scrutiny, the AO found a cash deposit of Rs.15,27,000/- during the demonetization period and proposed an addition under Section 68 for unexplained cash credit. The AO made the addition, which was subsequently upheld by the ld. CIT(Appeals).
Held
The Tribunal observed that the assessee was not provided sufficient opportunity to substantiate its claim before the lower authorities. Citing the principle of natural justice, the Tribunal remitted the case back to the Assessing Officer to re-examine the documents submitted by the assessee and afford a fresh opportunity of hearing. The appeal was allowed for statistical purposes.
Key Issues
Whether the revenue authorities erred by not providing sufficient opportunity to the assessee to substantiate its claims regarding cash deposits made during demonetization, leading to an addition under Section 68 of the Income Tax Act.
Sections Cited
80P(2)(19), 143(2), 142(1), 68
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Assessment Year: 2017-2018 Nandan Live Stock Development Cooperative Society Limited,………………………….……..……Appellant C/o. Jain Vinod K & Associates, 41A, A.J.C. Bose Road, Diamond Prestige Nirman, 6th Floor, Suite No. 613, Kolkata-700017 [PAN:AAAAN5417B] -Vs.- Assistant Commissioner of Income Tax,...Respondent Circle-1, Durgapur, Aayakar Bhawan, City Centre, Durgapur-734101, West Bengal Appearances by: Shri Vinod Jain, A.R., appeared on behalf of the assessee Ms. Madhumita Das, Addl. CIT, appeared on behalf of the Revenue Date of concluding the hearing: February 24, 2025 Date of pronouncing the order: May 06, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 6th August, 2024 passed for Assessment Year 2017-18.
(A.Y. 2017-2018) Nandan Live Stock Development Cooperative Society Limited 2. Brief facts of the case are that the assessee-Society is engaged in the business of Poultry Firming on cooperative basis. The assessee filed its return of income electronically on 11.12.2019 for the assessment year 2017-18 after claiming of exemption under section 80P(2)(19) of the Income Tax Act, 1961 declaring total income at ‘NIL’ The case was selected for scrutiny under CASS. Accordingly, notice under section 143(2) of the Act was issued to the assessee by the ld. Assessing Officer on 21.09.2018 fixing the date of hearing on 28.09.2018. Thereafter notice under section 142(1) along with questionnaire was issued on 24.05.2019, which was duly served upon the assessee. Thereafter the case was re- fixed for submitting requisite information/documents on 21.08.2019, 11.11.2019 and 25.11.2019. In response, the assessee submitted its reply through e-filing portal in ITBA. On 25.06.2019 and 28.11.2019, the assessee uploaded copy of balance-sheet, profit & loss account, supporting documents related for party-wise cash received during demonetization period. Not being satisfied, the ld. Assessing Officer issued a show-cause notice dated 10.12.2019 asking the assessee why the cash deposit during demonetization period of demonetized currency of Rs.15,27,000/- should not be added back to the total income on account of unexplained cash credit under section 68 of the Income Tax Act. Not getting satisfactory reply from the assessee, the ld. Assessing Officer passed the assessment order assessing the total income at Rs.15,27,000/-.
(A.Y. 2017-2018) Nandan Live Stock Development Cooperative Society Limited 3. On being aggrieved, the assessee preferred an appeal before the ld. CT(Appeals). The ld. CIT(Appeals) uphold the order passed by the ld. Assessing Officer.
The ld. Counsel for the assessee at the time of hearing argued that the revenue authorities have not given sufficient opportunity to the assessee to substantiate its claim. Therefore, he pleaded to set aside the order passed by the ld. CIT(Appeals) and remit the issue back to the file of ld. Assessing Officer to examine the issues afresh.
On the other hand, ld. Departmental Representative submitted that sufficient opportunity was being provided to the assessee to substantiate its claim but the assessee failed to produce the supporting evidences towards cash deposited in the Bank during demonetization period and the source thereof. Therefore, the ld. CIT(Appeals) has no other option except dismissing the appeal and he pleaded to uphold the order passed by the ld. CIT(Appeals).
I have heard both the sides and perused the material available on record. It was the submission of the assessee that the revenue authorities have not given sufficient opportunity to the assessee to substantiate its claim. The ld. Counsel for the assessee further submitted that the assessee filed all the relevant documents by way of paper book especially pages no.119 to 143. Therefore, he pleaded before me that one more opportunity to be given before the ld. Assessing Officer to examine the documents (A.Y. 2017-2018) Nandan Live Stock Development Cooperative Society Limited and dispose of the case afresh. The ld. D.R. has not raised any objection if the matter is remitted back to the file of ld. Assessing Officer to examine it afresh.
Considering the facts and circumstances of the case, I am inclined to set aside the order passed by the ld. CIT(Appeals) in order to meet the principle of natural justice, and remit the matter back to the file of ld. Assessing Officer to examine the documents afresh, which were filed by way of paper book especially from pages no. 119 to 143 with a direction to provide one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. Assessing Officer failing which the Ld. Assessing Officer shall be at liberty to pass appropriate order in accordance with law and merits based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 06/05/2025.
Sd/- (Duvvuru RL Reddy) Vice-President (KZ) Kolkata, the 6th day of May, 2025 Copies to :(1) Nandan Live Stock Development Cooperative Society Limited, C/o. Jain Vinod K & Associates, 4 (A.Y. 2017-2018) Nandan Live Stock Development Cooperative Society Limited 41A, A.J.C. Bose Road, Diamond Prestige Nirman, 6th Floor, Suite No. 613, Kolkata-700017 (2) Assistant Commissioner of Income Tax, Circle-1, Durgapur, Aayakar Bhawan, City Centre, Durgapur-734101, West Bengal