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Facts
The assessee, engaged in the wholesale vegetable business and commission agency, filed an income return for AY 2017-18 declaring Rs. 3,29,700/-. The AO completed the assessment at Rs. 48,27,468/-, making additions for 'income from business' and unexplained cash deposits.
Held
The CIT(A) confirmed the AO's action without a speaking order. The Tribunal held that the NFAC confirmed the addition without addressing the grounds of appeal and submissions. Therefore, the matter requires a de novo disposal by the CIT(A).
Key Issues
Whether the CIT(A)'s order confirming the additions without a speaking order is sustainable? Whether the additions made by the AO on account of business income and cash deposits are justified?
Sections Cited
143(3), Income Tax Act, 1961
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 08.05.2025 for Assessment Year (AY) 2017-18.
Brief facts of the case are that appellant is an individual, engaged in the business of wholesale dealer and commission agent of vegetables. The return of income for the A.Y. 2017-18 was filed on 31/03/2018 declaring income of Rs. 3,29,700/-. Against the said Anchalan Mohammed Najeeb return of income, the assessment was completed by the ITO, Ward- 3, Tirur ((for short, 'AO') passed u/s. 143(3) of the Income Tax Act, 1961 (for short, 'the Act') vide order 29/11/2019 at a total income of Rs. 48,27,468/-. While doing sothe AO made addition of Rs.24,90,294/- on account of ‘income from business’ and Rs.20,07,471/- being cash deposits made in the bank account as unexplained money of the appellant.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO without passing speaking order.
Being aggrieved by the order passes by NFAC, the assessee is in appeal before the Tribunal in the present appeal.
It is submitted that the appellant is engaged in the business of dealing in vegetables as well as acting as commission agent. Sale proceeds in respect of commission agency were also deposited in the bank account, therefore, the AO ought not have treated the entire cash deposits in the bank account as sale proceeds of the appellant since the appellant already offered income from commission agency. It is further submitted that the AO ought not have computed estimation of profit at 8% of the gross receipts as it is excessive and unreasonable. In any event, it is submitted that the income offered by the appellant under the head ‘business’ ought to have been reduced. As regards to the cash deposits, he submits that the cash
On the other hand, ld. Sr.DR submits that the order passed by the learned CIT(A) is a reasoned one, requires no interference by this Tribunal.
I have carefully perused the order passed by the learned CIT(A).The NFAC without meeting the grounds of appeal raised before the appellant, simply confirmed the addition without passing a reasoned and speaking order and addressing the submissions made before the NFAC. In these circumstances, I am of the considered opinion, the matter requires remand to the file of learned CIT(A) for denovo disposal in accordance with law after affording reasonable opportunity of being hearing to the appellant. I make it clear all the contentions raised before this Tribunal are kept open.
In the result, appeal filed by the assessee is partly allowed for statistical purposes Order pronounced in the open court on 13th August, 2025.