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Facts
The assessee appealed against an order confirming the addition of Rs. 12,86,500/- representing cash deposits during demonetization. The assessee argued that the source of the cash was business receipts from various activities, and that the entire deposits were gross collection, not income.
Held
The Tribunal found that the CIT(A) had failed to consider the submissions made by the assessee despite being provided with an opportunity. The order of the CIT(A) was set aside for de novo adjudication, and the grounds of appeal were allowed for statistical purposes.
Key Issues
Whether the CIT(A) properly adjudicated the appeal by considering the assessee's submissions regarding the source of cash deposits during demonetization.
Sections Cited
250, 69A, 115BBE
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Income Tax Appellate Tribunal, PUNE BENCHES “SMC” :: PUNE
Before: DR.DIPAK P. RIPOTE & SHRI VINAY BHAMORE
ORDER
PER DR. DIPAK P. RIPOTE, AM:
This is an appeal filed by the assessee against the order of ld.Commissioner of Income Tax(Appeal)[NFAC] under section 250 of the Income Tax Act, 1961 for A.Y.2017-18, dated 24.10.2024. The assessee has raised the following grounds of appeal :
1. On the facts and circumstances of the case and in law the CITINFAC) erred in confirming the addition made by the ITO of Rs.12,86,500/-representing the total of cash deposits during demonetization period not accepting submission of the appellant that:
[A] a. The source of the cash deposit being out of business receipts from goods vehicle transport and trading in khair wood and agricultural activities Le. from realization of business debtors and agricultural receipts, no addition is called for in respect of such cash deposits. b. The entire deposits representing only the gross collection, the addition of the whole amount is incorrect. c. At the most the addition ought to have been of the income component of the appellant in the cash deposit. The appellant prays that the ITO be directed to delete the addition The appellant craves leave to add to, amend, alter, delete or modify all or any of the above ground of appeal or raise a new ground of appeal before or at the time of hearing.” Submission of ld.AR :
2. Ld.AR submitted that though assessee had made an elaborate submission during the appellate proceedings before the ld.CIT(A), the ld.CIT(A) dismissed the appeal without considering the submission. Ld.AR read out the relevant paragraph of the ld.CIT(A)’s order. Ld.AR filed a paper book. Ld.AR took us through the e-proceeding Acknowledgment No.550648631300924 to demonstrate that Assessee had made elaborate submission in response to the notice issued by ld.CIT(A).
Submission of ld.DR : 3. Ld.DR relied on the order of the Assessment Order. However, when we asked a specific question with reference to the e- proceeding acknowledgment submitted by ld.AR, ld.DR accepted [A] that Assessee had made submission as appearing in the e- proceedings acknowledgment.
Findings & Analysis : 4. We have heard both the parties and perused the records. The relevant paragraph of the ld.CIT(A)’s order is reproduced as under : “In view of that considering the entire conspectus of the case I am of opinion that despite availing adequate opportunity the appellant is unable to give satisfactory explanation with corroborating evidence regarding specific source of cash deposit of Rs.12,86,500/-. Accordingly I do not find any infirmity in the order of the AO and find the same is justified in as much as the addition being made in accordance with law. Accordingly addition of Rs.12,86,500/- invoking provision of section 69A read with section 115BBE of the I.T Act stand confirmed and the grounds relating to these issues are dismissed.” 4.1 Thus, it is observed from the order of ld.CIT(A) that ld.CIT(A) has not discussed the submission filed by assessee, rather ld.CIT(A) has alleged that assessee has not made any submission. On perusal of the e-proceeding acknowledgment receipt filed by the ld.AR, it is noted that assessee has made an elaborate submission. However, ld.CIT(A) failed to consider the submission. Also, as per Section 250(6) of the Act, the ld.CIT(A) has to adjudicate each and every ground raised by the assessee. In this case, the ld.CIT(A) did not adjudicated the grounds raised by the assessee by considering the [A] submission made by the assessee. Therefore, the order of ld.CIT(A) is set-aside to ld.CIT(A) for denovo adjudication. The ld.CIT(A) shall provide opportunity to the assessee. Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose.
In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 22nd April, 2025.