VIJAYA RAJKUMAR BHOGLE,MUMBAI vs. ITO 17(3)(5), MUMBAI

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ITA 6026/MUM/2018Status: DisposedITAT Mumbai02 December 2019AY 2009-103 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found merit in the assessee's submissions and the explanation for absence before the CIT(A). It was held that remitting the matter to the Assessing Officer for de novo consideration would serve the interest of justice.

What were the facts?

The Assessing Officer reopened the assessment to examine cash deposits in the assessee's bank account. The assessee, engaged in a beauty parlour business, explained the source of funds, but the AO added a difference between P&L receipts and bank deposits as unexplained income. The CIT(A) confirmed this addition ex parte.

What were the issues?

Whether the addition of unexplained bank deposits was justified, and whether the assessee was denied a proper opportunity to be heard before the CIT(A).

Which sections of the Income-tax Act were involved?

Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” Bench, Mumbai

Before: Shri Shamim Yahya (AM) & Shri Amarjit Singh (JM)

For Appellant: Shri Subodh Ratnaparkhi
For Respondent: Shri Chaitanya Anjaria
Hearing: 03.09.2019Pronounced: 02.12.2019

O R D E R Per Shamim Yahya (AM) :- This appeal by the assessee is directed against order of learned CIT (A) dated 17.8.2018 and pertains to assessment year 2009-10.

2.

The issue raised is that the CIT(A) erred in sustaining the addition of Rs. 25,23,267/- as unexplained deposit in the bank by an ex parte order.

3.

In this case assessment was reopened for examining the issue of cash deposits in assessee’s bank account.

4.

Upon Assessing Officer’s enquiry regarding the source of cash deposits in the bank assessee explained that assessee is engaged into beauty parlour business. That assessee has filed return under section 44AD of the act. The assessee’s income from beauty parlour business was Rs. 16,77,871/-. Accordingly it was submitted that the profits shown in the profit and loss account are adequate. Assessee also submitted the copies of bank statement. The assessing officer held that total deposits in the bank account including cash, RTGS and cheque payment were rupees 42,01,138/-. He added the 2 Vijaya Rajkumar Bhogle difference between the gross receipt shown in the profit and loss account and the above bank deposit as unexplained income of the assessee.

4. upon assessee’s appeal by an ex parte order learned CIT(A) confirmed the action of the assessing officer.

5.

Against this order assessee is in appeal before ITAT. We have heard both the Counsel and perused the records. Learned counsel of the assessee submitted that the assessee’s deposits in bank in cash are only rupees 21,18,426/-. He submitted that assessee’s bank deposits include maturity proceeds of fixed deposit, income from agricultural business, transfer from Interbank accounts. Further learned counsel submitted that there was reasonable cause why the assessee was not presented before the learned CIT(A). In this regard assessee has also filed an affidavit before us. Learned counsel of the assessee prayed that the matter be matter to the file of assessing officer and the assessee may be allowed an opportunity to explain.

6.

Upon careful consideration we find considerable cogency in the submission of the learned counsel of the assessee. In our considered opinion the interest of justice will be served if the matter is remitted to the file of assessing officer. The assessing officer is directed to consider the issue de novo in light of the submissions of the learned counsel of the assessee. Needless to add assessee should be granted adequate opportunity of being heard

7.

In the result appeal filed by the assessee stands allowed for statistical purposes Order has been pronounced in the Court on 02.12.2019.

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