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Facts
The assessee, a small trader, was assessed for AY 2015-16. The Assessing Officer made an addition of Rs. 70,86,240/- under Section 69A for unexplained money, which was partly allowed by the CIT(A). The assessee claims business and car loans and cash deposits from sales were recorded in books.
Held
The Tribunal noted that the assessee took loans and made cash deposits from business sales. The assessee claimed the additions were erroneous and not supported by evidence, and that they were unable to respond to notices due to a misplaced phone. The Tribunal found it just and proper to remit the matter back to the Assessing Officer for verification.
Key Issues
Whether the addition made by the Assessing Officer under Section 69A for unexplained money is sustainable, and if the assessee's explanation regarding loans and business deposits is to be accepted.
Sections Cited
147, 144, 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM
Before: SHRI K.NARASIMHA CHARY & SHRI BALAKRISHNAN S
सुिवधई की तधरीख/Date of hearing: 04/03/2025 घोर्णध की तधरीख/Pronouncement on: 07/03/2025 आदेश / ORDER PER K. NARASIMHA CHARY, J.M: Aggrieved by the order dated 06/08/2024 passed by the learned Commissioner of Income Tax (Appeals), (“learned CIT(A)”), National Faceless Appeal Centre, Delhi in the case of Dadi Hema Kumar (“the assessee”) for the assessment year 2015-16, assessee preferred this appeal.
Brief facts of the case are that the assessment in the case of the assessee was completed and the learned Assessing Officer passed assessment order under section 147 read with section 144 of the Income Tax Act, 1961 (“the Act”) dated 06/03/2024, by making addition of Rs.70,86,240/- as unexplained money under section 69A of the Act.
Aggrieved by the order passed by the learned Assessing Officer, assessee preferred an appeal before the learned CIT(A) and the learned CIT(A) partly allowed the appeal filed by the assessee.
Aggrieved by the order of the learned CIT(A) assessee preferred an appeal before the Tribunal. At the outset, learned AR submitted that the assessee is a small trader in silver articles and gold petty ornaments. He had taken business loan of Rs.40,00,000/- and car loan Rs.9,00,000/- from Canara Bank, Chettivanipalem during the assessment year 2015-16, which was redeposited into the Canara Bank SB account. The assessee had also deposited sale proceeds from his business in cash. Assessee was provided with cash credit facility with Canara bank, Chittivanipalem sanctioned by the bank on 19/01/2015 against security of stock and debtors, which clearly shows that the assessee is carrying on business. Learned AR further submitted that all the cash deposits were recorded in the books of accounts maintained by the assessee. Learned AR further submitted that the Revenue authorities never called for the books of accounts and erroneously made addition of Rs.61,10,040/- as unexplained money under section 69A of the Act, which cannot be sustained.
In view of the foregoing facts and circumstances of the case, learned AR pleaded to set aside the order passed by the learned CIT(A) and delete the addition made by the learned Assessing Officer. Learned AR further submitted that the assessee could not respond to the notices sent electronically as his phone registered with the department was misplaced and he was not aware of the order passed under section 148A(d) passed by JAO Anakapalle.
On the other hand, learned DR submitted that the assessee was non- compliant during the proceedings before the learned AO and the learned CIT(A) and did not produce relevant evidences in support of his claim. He, therefore, submitted that the learned CIT(A) is justified in dismissing the appeal filed by the assessee, which needs to be upheld.
We have gone through the record, in light of submissions made on either side. It is undisputed fact that the assessee had taken loan of Rs.49,00,000/- and also made cash deposits out of sale proceeds from his business during the assessment year 2015-16. In order to verify the claim of the assessee and keeping in view the principles of natural justice, we deem it just and proper to remit the matter back to the file of the learned Assessing Officer with a direction to verify the claim of the assessee with evidences, decide the matter on merits and pass order accordingly. Needless to say, the assessee shall appear before the learned Assessing Officer and file necessary evidences without seeking further adjournments.
In the result, the appeal of the assessee is allowed for statistical purpose.
Order pronounced in the Open Court on 7th March, 2025.