INCOME TAX OFFICER, BALURGHAT vs. PRAKASH CHANDRA SAHA, KUSHMANDI

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ITA 1585/KOL/2024Status: DisposedITAT Kolkata25 March 2025AY 2018-196 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal dismissed the Revenue's appeal. Regarding the issue of admitting fresh evidence, while not explicitly addressed as a separate point, the Tribunal noted that the Ld. CIT(A) had given detailed findings of fact based on the documents provided by the assessee. The Tribunal observed that the assessee acted as a CSP agent for the State Bank of India through Save Solutions Pvt. Ltd. The credits in the assessee's account were from Save Solutions Pvt. Ltd., and the withdrawals were made on behalf of the bank for customer transactions. The Tribunal agreed with the Ld. CIT(A) that the AO incorrectly treated these withdrawals as unexplained money under Section 69A, as the source of money was not disputed and the withdrawals were handled as per the bank's directions. Consequently, the addition of ₹1,93,26,069/- as unexplained money and ₹1,90,269/- as contractual receipt was not maintainable. The Tribunal upheld the CIT(A)'s deletion of both additions.

What were the facts?

The Revenue appealed the order of the National Faceless Appeal Centre (NFAC), Delhi, dated 05.06.2024, for Assessment Year 2018-19. The assessee, Prakash Chandra Saha, was a non-filer. Following a Section 148A(d) order, the Assessing Officer (AO) noted financial transactions of ₹1,95,16,338/-. These included cash withdrawals of ₹1,93,26,069/- and contract receipts of ₹1,90,269/- from Save Solutions Pvt. Ltd. A notice under Section 148 was issued, and the assessee filed a return declaring ₹2,23,660/-. The AO assessed income at ₹1,97,40,000/-, adding the cash withdrawals as unexplained money and the contractual receipts. The CIT(A) allowed the assessee's appeal, deleting both additions.

What were the issues?

1. Whether the Ld. CIT(A) erred in admitting fresh evidences without calling for a remand report, in contravention of Rule 46A(3) of the Income Tax Rules, 1963? Assessee's Contention: The assessee argued that he was appointed as a Customer Service Point (CSP) Agent by Save Solutions Pvt. Ltd. on behalf of the State Bank of India, and all credits and debits pertained to customer transactions. He provided a certificate of appointment, bank statements, commission details, and Profit and Loss Account. Revenue's Contention: The Revenue's sole ground of appeal was that the Ld. CIT(A) admitted fresh evidence without a remand report, violating Rule 46A(3).

Which sections of the Income-tax Act were involved?

Section 148A,Section 148,Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, KOLKATA

Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM

For Appellant: Shri Prakash Chandra Saha, Self
For Respondent: Shri Ranu Biswas, DR
Hearing: 18.03.2025Pronounced: 25.03.2025

This is an appeal preferred by the Revenue against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 05.06.2024 for the AY 2018-19.

2.

The only issue raised by the Revenue in various grounds of appeal is against admitting fresh evidences by ld CIT(A) without calling for the remand report which are in contravention of Rule 46A(3) of the Income Tax Rules, 1963 (‘the Rules’).

3.

The facts in brief are that the assessee is a non-filer of return and as per order u/s 148A(d) of the Act dated 26.03.2022, there were financial transactions of ₹1,95,16,338/- by the assessee and a. Cash withdrawals through bearers cheque amounting to ₹1,93,26,069/-

b. Contract receipts from Save Solutions Pvt. Ltd. amounting to ₹1,90,269/-.

4.

Accordingly, notice u/s 148 of the Act was issued on 26.02.2022, which was complied with by the assessee by filing the return of income on 19.04.2022, declaring total income of ₹2,23,660/-. Thereafter, the statutory notices were duly served upon the assessee. However, there was no response from the assessee and finally, the ld. AO assessed the income at ₹1,97,40,000/- by making an addition of (i) cash withdrawals of ₹1,93,26,069/- as unexplained money and (2) ₹1,90,269/- in respect of contractual receipt.

5.

In the appellate proceedings, the ld. CIT (A) allowed the appeal of the assessee by observing and holding as under:-

“4. During the course of appeal proceedings, hearing notices were sent. In response, the appellant stated that he was appointed as Customer Service Point Agent (CSP Agent) by Save Solution Pvt. Ltd. on behalf of State Bank of India and all the credits and debits were pertaining to the customers. The appellant provided the certificate, Copy of the Bank Statement, Details of Commission Earned, Profit and Loss Account and Computation of Income. The details are as under:

From the details filed by the appellant it is noticed that the AO added a sum ofRs. 1,93,26,069/- as unexplained money u/s 69A of the IT Act without conducting anyenquiries. When the appellant withdraw money from the bank account it cannot betreated as unexplained money u/s 69 A of the IT Act. Bank withdrawal cannot beunexplained money. The AO ought to have verified the sources of credits into thebank accounts. In this case, the source was transfer entries credited into his bankaccount as the appellant acted as CSP agent on behalf of Save Solutions Pvt Ltd.This sum only withdrawn and given to the respective customers. Hence, addition ofunexplained money of Rs.1,93,26,029/- is not maintainable as it was not unexplained money.

7.

In the result, the appeal of the Revenue is dismissed.

Order pronounced in the open court on 25.03.2025.

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