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Facts
The assessee, a Cooperative Society, filed its return for AY 2015-16 declaring a loss. During scrutiny, the Assessing Officer made various additions, including an ad-hoc government grant, cash credits, unrecorded creditors, cash payments, donations, and other expenses, assessing the income at Rs. 32,97,920/-. The CIT(Appeals) dismissed the assessee's appeal due to non-submission of documents and non-appearance.
Held
The ITAT, noting the CIT(A)'s dismissal without considering merits, set aside the order and remitted the matter back to the CIT(Appeals). This was done to ensure natural justice, providing the assessee one final opportunity to present its case, with a caution to cooperate. The appeal was allowed for statistical purposes.
Key Issues
Whether the additions made by the Assessing Officer were justified given the assessee's non-cooperation, and if the CIT(Appeals) was right in dismissing the appeal without merit-based consideration.
Sections Cited
139(1), 143(1), 143(2)
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: 2015-2016 Tehatta Thana Cooperative Agricultural Marketing Society Limited,……………..……Appellant Sahebnagar, Sahebnagar Tehatta, Nadia-741160, W.B. [PAN:AABAT4934G] -Vs.- Income Tax Officer,…………………………...Respondent Ward-41(4), Kolkata, Anantahari Mitra Road, Nadierpara, Nadia, Krishnanagar, W.B. Appearances by: Shri Anil Kumar Kochar, Advocate, appeared on behalf of the assessee Shri Subhro Das, Addl. CIT, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: December 31, 2025 Date of pronouncing the order: January 31, 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 4th September, 2023 passed for Assessment Year 2015-16.
(A.Y. 2015-2016) Tehatta Thana Cooperative Agricultural Marketing Society Limited 2. Brief facts of the case are that the assessee, a Cooperative Society, filed its return of income on 30.09.2015 declaring total loss of Rs.9,45,476/- under section 139(1) of the Income Tax Act, 1961. The return of income was processed under section 143(1) of the Act on 17.10.2015 by the CPC. The case was selected for scrutiny under CASS and accordingly notice under section 143(2) dated 05.08.2016 was issued and duly served on the assessee. The ld. A.R. on behalf of the assessee appeared and produced books of account. On verification of books of account, it was found that an amount of Rs.1,43,400/- as adhoc grant from the government was received on behalf of the assessee-Society, but the assessee’ Cooperative Society failed to explain the nature of adhoc grant, whether grant was in the nature of revenue or capital. Ld. Assessing Officer issued show-cause notice to the assessee dated 22.11.2017 asking as to why the amount of Rs.1,43,400/- should not be taken as revenue receipt and added to the total income of the assessee-Society. Thereafter various additions, i.e. cash credit amounting to Rs.1,55,000/- in respect of West Bengal State Cooperative Marketing Federation (BENFED), Rs.63,000/- in respect of non-recording of creditors in the nature of credit purchase, Rs.32,26,191/- in respect of amount of Rs.32,26,191/- paid in cash to one Shri Jagadish Prosad Agarwalla, Rs.24,905/- on account of donation paid, Rs.8,607/- on account of payments made towards infringement of statue, Rs.55,000/- on account of Gift for Puja, Rs.9,265/- shown as outstanding balances, Rs.5,72,363/- towards remained unpaid as shown debited in the profit & loss account, were made by the ld. Assessing Officer. The ld. Counsel for the assessee-Society did not furnish any supporting (A.Y. 2015-2016) Tehatta Thana Cooperative Agricultural Marketing Society Limited documents. Since the assessee failed to do so, therefore, after considering the submission of the assessee and material facts available on the record, ld. Assessing Officer assessed income at Rs.32,97,920/- and added back to the total income of the assessee. On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals).
The ld. CIT(Appeals) has given several opportunities to the assessee to substantiate its claim, but the appellant did not file the written submissions and did not represent the case before the ld. CIT(Appeals). Thereafter the ld. CIT(Appeals) dismissed the appeal of assessee on 4th September, 2023.
On being aggrieved, the assessee preferred an appeal before the ITAT.
At the time of hearing, it was the submission of the ld. Counsel for the assessee that ld. CIT(Appeals) did not consider the case on merit, rather passed the order by upholding the order of ld. Assessing Officer. Therefore, he pleaded to delete the addition made by the ld. Assessing Officer as confirmed by the ld. CIT(Appeals).
At the outset, ld. D.R. brought to my notice that the assessee did not produce the relevant documents as asked by the ld. Assessing Officer during the assessment proceedings. Therefore, the ld. Assessing Officer passed the assessment order assessing the taxable income at Rs.32,97,920/-. Thereafter the assessee (A.Y. 2015-2016) Tehatta Thana Cooperative Agricultural Marketing Society Limited preferred an appeal before the ld. CIT(Appeals). The ld. CIT(Appeals) has given many opportunities to the assessee and the assessee neither filed written submission nor any evidence before the ld. CIT(Appeals). He further submitted that before the ITAT, the ld. Counsel for the assessee did not substantiate its claim. Therefore, he pleaded to uphold the orders passed by the revenue authorities.
I have heard the rival submissions and perused the material available on record. 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. CIT(Appeals) 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. CIT(Appeals) failing which the Ld. CIT(Appeals) 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 31/01/2025.