EVEXIA LIFECARE LIMITED,VADODARA vs. THE ITO, WARD-1(1)(1), VADODARA
Income Tax Appellate Tribunal, AHMEDABAD “D” BENCH, AHMEDABAD
Before: SHRI T.R. SENTHIL KUMAR & SHRI NARENDRA PRASAD SINHAAssessment Year: 2018-19
PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER: This appeal is filed by the assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi (in short “the CIT(A)”) dated 07.02.2025 for the Assessment Year (A.Y.) 2018-19 in the proceedings under Section 147 r.w.s. 144B of the Income Tax Act, 1961(hereinafter referred to as ‘the Act’). 2. The brief facts of the case are that the assessee filed its return of income for the A.Y. 2018-19 on 31.03.2019 declaring income of Rs.1,22,38,750/-. The Assessing Officer had received an information that Evexia Lifecare Limited vs. ITO Page 2 of 5
the assessee had entered into certain transactions which were in the nature of accommodation entries. It transpired that there were rapid movement of funds with total credit amount of Rs.15,65,84,396/-, in only
23 transactions, in the company’s account. On the basis of this information, the case of the assessee was reopened under Section 147
of the Act to examine these transactions and a notice under Section 148
of the Act was issued on 31.03.2022. In the course of assessment, the assessee had explained that these transactions were on account of sales, purchases and repayment of loans and certain copies of invoices of sales and purchases were also filed. However, the Assessing Officer was not satisfied with the explanation of the assessee. He found that the amount received from one party was transferred to another party on the same day, the rationale of which was not explained. The Assessing Officer, therefore, treated the entire transactions as accommodation entries and estimated the commission at the rate of 5% on the total credit of Rs.15,65,84,396/- as appearing in the bank account. Accordingly, an addition of Rs.78,29,220/- was made on account of commission income and the assessment was completed under Section 147 r.w.s. 144(B) of the Act on 09.03.2023 at a total income of Rs.2,00,67,970/-.
3. Aggrieved with the order of the Assessing Officer, the assessee filed an appeal before the First Appellate Authority which was decided vide the impugned order and the appeal of the assessee was dismissed.
4. Now, the assessee is in second appeal before us. The following grounds have been taken in this appeal: -
“1. The order passed by the Commissioner of Income Tax (Appeals)
National Faceless Appeal Centre (hereinafter referred to as "CIT(A)") is legally unsustainable and should be set aside.
2. The learned CIT(A) erred in both law and fact in confirming the addition of Rs.78,29,220/- made by the National Faceless Assessment Unit
(hereinafter referred to as "the AO"), treating the same as unexplained money and considering it as commission income at 5% on credit transactions in the bank account of Equitas Small Finance Bank, having account number 200000522243. This was done without duly considering the material facts and circumstances of the case.
3. Your Appellant craves the right to add to or alter, amend, substitute, delete or modify all or any of the above grounds of appeal.
Shri Prashant Upadhyay, the Ld. AR of the assessee, submitted at the outset, that no compliance could be made before the Ld. CIT(A) and he had decided the matter ex-parte confirming the addition as made by the Assessing Officer. He submitted that the assessee was a registered company and no irregularity on the financial aspect of the company was found by the statutory Auditor or by any other authorities. He contended that the addition was made by the Assessing Officer on mere suspicion and without any concrete evidence that the assessee had entered into accommodation entry transactions. He submitted that all the credits appearing in the assessee’s bank account were regular business transactions. The Ld. AR further submitted that the assessee may be allowed another opportunity to explain the matter before the Ld. CIT(A) and for this purpose the matter may be set aside to the file of the Ld. CIT(A). 6. Per contra, Shri Sudhakar Verma, the Ld. SR.-DR supported the orders of the Assessing Officer and the Ld. CIT(A). However, he had no objection, if the matter was set aside to the file of the Ld. CIT(A) for allowing one more opportunity to the assessee. 7. We have considered the request of the assessee. It is found that the Ld. CIT(A) had allowed six opportunities but no compliance was made by the assessee on any of the dates. Neither the assessee had filed adjournment application on any of the occasions nor the assessee has explained the reasons for non-compliance before the Ld. CIT(A). Under the circumstances, we deem it appropriate to impose a cost of Rs.10,000/- (Rupees Ten Thousand only) on the assessee which should be deposited to the Prime Minister’s National Relief Fund within a period of 15 days of receipt of this order. Subject to payment of cost, we deem it proper to set aside the matter to the file of the Ld. CIT(A) with a direction to allow one more opportunity to the assessee, as the matter was not adjudicated by the Ld. CIT(A) on merits. The assessee is also directed to make compliance before the Ld. CIT(A) and provide necessary documents and details in support of the grounds as taken in its appeal. If the assessee does not make any compliance in the course of set aside proceedings, the Ld. CIT(A) will be free to decide the matter on merits on the basis of the facts and materials available on record. 8. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on this 3rd September, 2025. (T.R. SENTHIL KUMAR) (NARENDRA PRASAD SINHA) Judicial Member
Accountant Member
Ahmedabad, the 3rd September, 2025
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(2)
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(3)
The PCIT
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The CIT(A)
(5)
Departmental Representative
(6)
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