MURALEEDHARAN PILLAI ARUNKUMAR,KOLLAM vs. ITO WARD 1 & TPS, ALAPPUZHA
What did the Tribunal hold?
The Tribunal found that the AO had passed a best judgment assessment due to the appellant's failure to comply with a notice under Section 142(1). Acknowledging the reasons for non-compliance, the Tribunal decided to remand the case back to the AO for a de novo assessment after providing the appellant a reasonable opportunity of being heard.
What were the facts?
An individual appellant did not file an income tax return for AY 2017-18. Information regarding significant cash deposits led the AO to issue a notice under Section 148, subsequently completing an assessment under Section 147 read with Section 144B, making additions for unexplained cash deposits and vendor commission, which were confirmed by the CIT(A).
What were the issues?
The key issues were the justification of additions made by the AO for cash deposits and vendor commission, and the appropriateness of the best judgment assessment when the appellant claimed to be a stamp vendor with cash from stamp sales. The central procedural issue was the non-compliance with Section 142(1) notice and whether the case should be remanded.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
Assessment Year: 2017-18 Muraleedharan Pillai Arunkumar .......... Appellant Karuvazhathu House, Thevalakara P.O. Palickal, Karunagappally 690524 [PAN: AVJPA3922F] vs. The Income Tax Officer, WD-1&TPS, Alappuzha.......... Respondent Assessee by: Shri R. Krishnan, CA Revenue by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 29.10.2025 Date of Pronouncement: 20.11.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 30.07.2025 for Assessment Year (AY) 2017-18.
Brief facts of the case are that the appellant is an individual. No regular return of income for AY 2017-18 was filed by the appellant. Based on the information that the appellant made cash deposits of Rs. 1,65,98,650/- National Faceless Assessment Centre, Delhi (hereinafter called "the AO") formed an opinion that income escaped assessment to tax. Accordingly, a notice u/s. 148 of the Income Tax Act, 1961 (the Act) was issued on 30.03.2021. In Muraleedharan Pillai Arunkumar response to the notice u/s. 148, the appellant filed return of income on 29.11.2021 disclosing income of Rs. 3,00,990/-. Against the said return of income, the assessment was completed by the AO vide order dated 29.03.2022 passes u/s. 147 r.w.s. 144B of the Act at total income of Rs. 30,70,746/-. While doing so, the AO made addition of cash deposits of Rs. 20,11,631/- s unexplained money of the appellant. The AO also made addition on account of vendor commission of Rs. 7,58,125/-.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO.
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
The learned counsel for the assessee contending that the appellant is merely a stamp vendor and the cash deposits were made out of sale proceedings of stamps, therefore, no addition on account of cash deposits is required to be made.
On the other hand, the learned Sr. DR supporting the orders of the learned lower authorities submits that no interference is called for.
I heard the rival contentions and perused the material available on record. I find that the AO bas passed the best judgement assessment as the appellant had failed to comply with the notice Muraleedharan Pillai Arunkumar issued u/s. 142(1) of the Act. Since I am satisfied with the reasons for non compliance with the notice, I am of the considered opinion that the matter requires remand to the file of the AO for de novo assessment in accordance with law after affording reasonable opportunity of hearing to the appellant.
In the result, the appeal filed by the assessee stands partly allowed for statistical purposes.
Order pronounced in the open court on 20th November, 2025.
More judgments on Section 148
- ACIT Central Bilaspur, Bilaspur vs Arun Kumar Agrawal, SaktiITSSA 26/RPR/2025[2018-19]Status: Disposed21 Oct 2026AY 2018-19
- Vinod Agrawal, Kawardha vs Assisstant Commissioner of Income Tax…ITA 666/RPR/2026[2019-20]Status: Heard21 Oct 2026AY 2019-20
- Sar Business Tradelink Private Limited… vs Income Tax Officer, Ward - 1(2), RaipurITA 599/RPR/2026[2014-15]Status: Heard21 Oct 2026AY 2014-15
- Neo Incorporation, Rajkot vs DCIT Circle- 1(2), RajkotITA 471/RJT/2026[2012-2013]Status: Disposed21 Oct 2026AY 2012-2013
- Adj Agri International LLP, Rajkot vs The Income Tax Officer, Ward-1(1)(1), RajkotITA 1198/RJT/2026[2018-19]Status: Disposed21 Oct 2026AY 2018-19
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