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Facts
The assessee, Saroja Gouru, filed her ROI for A.Y. 2017-18, which was selected for scrutiny due to a cash deposit of Rs. 9.25 lakhs in her bank account during the demonetisation period. The AO made an addition under Section 69A for lack of supporting evidence, and this addition was upheld by the CIT(A).
Held
The Tribunal noted the assessee's claim that the deposit was from a loan and her readiness to furnish evidence. Considering the principle of natural justice, the Tribunal set aside the CIT(A)'s order and remanded the issue back to the AO for fresh examination, granting the assessee an opportunity to present all necessary information and documents.
Key Issues
Whether the lower authorities were justified in making and upholding an addition under Section 69A without providing sufficient opportunity to the assessee to substantiate the source and genuineness of the cash deposit.
Sections Cited
143(3), 69A
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Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad
Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA
आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M.: This appeal is filed by Saroja Gouru (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 11.11.2024 for the A.Y. 2017-18.
The brief facts of the case are that, the assessee is an individual deriving income from house property, income from partnership firms and other sources, filed her Return of Income (“ROI”) for the A.Y. 2017-18 on 02.03.2018 declaring a total income of Rs.6,69,319/-. The return was selected for scrutiny under CASS in ‘Limited’ category to examine “Large value cash deposits during the demonetisation period as compared to the returned income’. During the assessment proceedings, the Learned Assessing Officer (“Ld. AO”) found that the assessee has deposited cash of Rs.9.25 lakhs in her S.B. Account with State Bank of India during demonetisation period. The Ld. AO completed the assessment u/s.143(3) on 13.12.2019 by making addition of Rs.9.25 lakhs u/s.69A of the Act in the hands of the assessee, contending that sufficient supporting evidences in support of cash deposit were not produced by the assessee.
Aggrieved with the order of Ld. AO, the assessee filed appeal before the Ld. CIT(A). The Ld. CIT(A) upholding the addition made by the Ld. AO, dismissed the appeal of the assessee.
Aggrieved with the order of Ld. CIT(A), the assessee is in appeal before us. The Learned Authorised Representative (“Ld. AR”) submitted that, the assessee explained before the Ld. AO that, she had deposited cash in bank out of loan received from Mr. Gouru Sumanth and filed a confirmation letter from Mr. Gouru Sumanth in support of the loan so taken. However, the Ld. AO without calling for any additional evidence, made the addition in the hands of the assessee contending that sufficient evidences were not provided by the assessee. The Ld. AR further submitted that, the Ld. AO has made the addition without providing sufficient opportunity to prove the genuineness of the transaction. He also submitted that, if an opportunity be granted, the assessee is ready to file further evidence, as required by the Ld. AO, to substantiate the genuineness of the transaction. Accordingly, the Ld. AR prayed before the bench to set aside the issue to the file of Ld. AO for fresh examination.
Per contra, Ld. DR placed heavy reliance on the orders of the Revenue authorities and submitted that, sufficient opportunity has already been given by the Revenue authorities, but the assessee failed to avail the same. He opposed the grant of further opportunity to the assessee.
We have heard the rival contentions and also gone through the record in the light of the submissions made by either side. It could be seen from the orders of Ld. AO that, the addition has been caused due to lack of sufficient supporting evidences in support of the sources of deposit of cash of Rs. 9,25,000/- in the bank account of the assessee. It is a fact that the assessee does not stand to gain by not producing the necessary information/documents and prosecute her case on merits. Be that as it may, now the assessee is ready to produce all information/documents and get the matter disposed of on merits. The highest that would happen by allowing an opportunity to the assessee is that a cause would be decided on merits. With this view of the matter and considering the principle of natural justice, we are of the view that fresh opportunity should be given to the assessee. Accordingly, we set aside the impugned order and restore the issue to the file of the Ld. AO for passing a fresh order on merits after affording the opportunity of hearing to the assessee. Grounds of appeal are answered accordingly.