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Facts
The Revenue appealed against an NFAC order for A.Y. 2017-18, arising from an assessment made under Section 144. The assessee failed to appear before lower authorities and the Tribunal. The case involved large cash deposits during the demonetization period, leading to an addition under Section 69A read with Section 115BBE, which the CIT(A) upheld by estimating profits at 12% on alleged cash deposits.
Held
The Tribunal observed a lack of evidence regarding the assessee's business operations, books of account, and details of cash deposits. It also found the 12% profit estimation by the CIT(A) to be unrealistic. Therefore, the Tribunal remitted the matter back to the Jurisdictional Assessing Officer for a de novo assessment, instructing the assessee to provide necessary details and cooperate.
Key Issues
Whether the addition on cash deposits during demonetization was justified without proper evidence of business operations and books of account, and the validity of the profit estimation by the CIT(A) under such circumstances.
Sections Cited
250, 144, 143(2), 142(1), 69A, 115BBE
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Income Tax Appellate Tribunal, PUNE BENCHES “A”, PUNE
Before: DR.MANISH BORAD & SHRI VINAY BHAMORE
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of Revenue pertaining to A.Y. 2017-18 is directed against the order dated 17.09.2024 of National Faceless Appeal Centre (NFAC) Delhi passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of Assessment Order dated 18.12.2019 passed u/s.144 of the Act.
When the case was called for, none appeared on behalf the respondent-assessee. In the past when the appeal was fixed for hearing on 17.02.2025, 15.04.2025, 19.06.2025 and 04.08.2025 there was no representation on behalf of the respondent-assessee. Respondent-assessee was served with the notice of hearing fixing the case on 19.08.2025 but there is no representation. Therefore, it seems that the respondent- Aslam Badshah Shaikh assessee is not interested in appearing before this Tribunal. We therefore proceed to adjudicate the appeal of the Revenue exparte qua respondent with the assistance of ld. Departmental Representative and the available records.
Ld. DR at the outset submitted that respondent-assessee failed to appear before both the lower authorities. Therefore, the matter deserves to be restored to the file of ld. Jurisdictional Assessing officer for necessary adjudication.
We have heard the ld. DR and perused the record placed before us. We notice that the assessee is an individual and return of income for A.Y. 2017-18 e filed on 12.09.2018 declaring income of Rs.18,96,980/-. Case selected for scrutiny through CASS for the reasons large value cash deposit during demonetization period and abnormal increase in cash deposit during demonetization period as compared to pre- demonetization period. Valid notices u/s.143(2) and 142(1) of the Act served upon the assessee. However, on the subsequent dates of hearing, assessee failed to respond. Ld. Assessing Office made addition of the total cash deposit of Rs.4,17,18,810/-. u/s.69A r.w.s.115BBE of the Act assessing the income at Rs.4,46,15,790/-. Thereafter, assessee preferred appeal before ld.CIT(A) but after filing the appeal and furnishing the statement of acts along with appeal there was no further compliance. Ld.CIT(A) based on the statement of facts accepted that the assessee is carrying on the business of sale of Petroleum products and accordingly estimated the profits @12% of the alleged cash deposit and sustained the addition of Rs.56,56,260/-.
Aslam Badshah Shaikh 5. We however notice that there is no evidence placed on record about the assessee running petrol pump nor any information about the books of account and the details of cash deposits have been filed. Also the Tax Audit Report furnished on line is not placed before us. Ld. CIT(A) has only estimated the profit @12% inspite of the fact that such huge net profit rate is not possible in the business of running a petrol pump. Considering all these aspects and also in the larger interest of justice and being fair to both the parties, we deem it proper to remit back the issues raised in the instant appeal to the file of ld. Jurisdictional Assessing Officer for denovo assessment which has to be carried out after providing reasonable opportunity to the respondent-assessee. Respondent-assessee is directed to furnish the requisite details to explain the source of alleged cash deposit during the denovo assessment proceedings. Respondent-assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Impugned order is set aside and the effective grounds of appeal raised by the Revenue are allowed for statistical purposes.
In the result, appeal of the Revenue is allowed for statistical purposes.
Order pronounced on this 12th day of September, 2025.