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Facts
The assessee, engaged in the dairy milk business, filed a return of income. During assessment, discrepancies were found between bank transactions and declared sales, and the assessee failed to provide supporting documents for cash deposits and withdrawals. The Assessing Officer estimated the total income at Rs. 13,11,050/-, including unexplained money.
Held
The Tribunal noted that the assessee failed to provide necessary details and evidence to the Assessing Officer and the CIT(Appeals). The CIT(Appeals) dismissed the appeal ex-parte. To ensure natural justice, the Tribunal decided to give one more opportunity to the assessee.
Key Issues
Whether the assessee provided sufficient evidence for cash deposits and withdrawals, and whether the CIT(Appeals) rightly dismissed the appeal ex-parte without considering the merits.
Sections Cited
143(2), 142(1), 69A, 115BBE
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Income Tax Appellate Tribunal, KOLKATA-PATNA ‘e-COURT’, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Assessment Year: 2017-2018 Digwijay Singh,………....………………..………Appellant Near Mission Hospital, Maharaj Nagar, Maner, Patna-801108, Bihar [PAN:CJZPS5599C] -Vs.- Income Tax Officer,……………………………..Respondent Ward-4(2), Patna, Lok Nayak Jay Prakash Bhawan, 4th Floor, Dakbunglo Chowk, Patna-800001, Bihar Appearances by: N o n e, appeared on behalf of the assessee Shri Ashwani Kr. Singal, JCIT, appeared on behalf of the Revenue Date of concluding the hearing: June 24, 2025 Date of pronouncing the order: July 30, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of ld. Additional/ Joint Commissioner of Income Tax (Appeals), Thane dated 09.03.2024 passed for Assessment Year 2017-2018.
(A.Y. 2017-2018) Digwijay Singh 2. None appeared on behalf of the assessee. Therefore, I have decided to dispose of the appeal after hearing the ld. Departmental Representative and perusing the material available on record.
Brief facts of the case are that the assesese filed his return of income electronically on 31.03.2018 in ITR 3 showing total income of Rs.4,79,890/- after claiming deduction under Chapter VI. Subsequently, the assessee filed revised return in ITR 3 showing total income of Rs.4,79,890/- on 13.06.2018. The assessee derives income from dairy milk. The case was selected for limited scrutiny assessment through CASS to examine cash deposit4 and withdrawal during the year. Accordingly departmental notices under sections 143(2) and 142(1) of the Income Tax Act were issued and served upon the assessee. In compliance, the assessee submitted that he is engaged in the business of purchase milk from rural area, supplier of milk and procuring milk from own dairy and supply to Anuj Dairy, Hazipur and some individual customers. During the assessment year, the assessee declared gross total income of Rs.5,25,002/- and after deduction under chapter VIA, total income comes to Rs.4,79,890/- and deposited tax under self-assessment amounting to Rs.23,160/- from that he claimed for refund of Rs.560/-.Bank statement obtained from Canara Bank, Maner Patna, on perusal of the Bank statement, it was observed that total transaction made into the Bank account was Rs.1,13,18,866/-, whereas total sale has been shown in the ITR at Rs.1,21,65,601/-. Notice under section 14291) of the Act dated 08.07.2019 issued to the assessee to furnish sale ledger including bills and vouchers in support of transaction and (A.Y. 2017-2018) Digwijay Singh withdrawal but the assessee failed to do so. From the ledger account it was observed that M/s. Anuj Dairy paid Rs.1,06,67,610/- to the assessee against purchase of milk. The assessee neither produced documentary evidence in support of cash deposit made during the year under consideration nor submitted sale and purchase ledger which was shown of Rs.1,21,65,601/- in the ITR. After that, a final show cause letter dated 15.11.2019 issued to the assesese for compliance to explain as to why cash deposit of Rs.3,37,800/- for the year should not be treated as unexplained money under section 69A read with section 115BBE. The assessee failed to offer any explanation to show cause letter. Finally, ld. Assessing Officer assessed the total income of the assessee at Rs.13,11,050/-. Not being satisfied with the order of ld. Assessing Officer, the assessee preferred an appeal before the ld. CIT(Appeals).
The ld. Addl./JCIT(Appeals) dismissed the appeal of the assessee ex-parte without going into the merit of the case as the assessee failed to produce the details to explain the cash deposits and cash withdrawals. The assessee did not furnish any evidence in support of his claim.
On being aggrieved, the assessee preferred an appeal before the ITAT.
At the time of hearing, ld. Departmental Representative submitted that sufficient opportunity was being provided to the assessee but the assessee failed to appear before the ld. (A.Y. 2017-2018) Digwijay Singh CIT(Appeals). Therefore, the ld. CIT(Appeals) has no other option except dismissing the appeal and he pleaded to uphold the order passed by the ld. CIT(Appeals).
I have heard the ld. Departmental Representative and perused the material available on record. I find that the assessee failed to produce the details to explain the cash deposits and cash withdrawals before the ld. Assessing Officer as well as ld. CIT(Appeals). The assessee did not furnish any evidence in support of his claim. The ld. Addl./JCIT(Appeals) dismissed the appeal of the assessee ex-parte without going into the merit of the case. In absence of any submission and documentary evidences from the side of assessee, the ld. Addl./JCIT(Appeals) upheld the order of ld. Assessing Officer estimating the income of Rs.9,73,248/- @ 8% of the total turnover and adding Rs.3,37,800/- as unexplained money under section 69A of the Act. Therefore, in order to ensure the principle of natural justice, I am of the view that it is a fit case to provide one more opportunity to the assessee. Therefore, I remit the matter back to the file of ld. Addl./JCIT(Appeals) with a direction to dispose of the appeal without any inference on the observations of earlier order passed by him. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the ld. Addl./JCIT(Appeals) failing which the ld. Addl./JCIT(Appeals) shall be at liberty to pass appropriate order in accordance with law and merits of the case, based on the materials available on the record. Thus, the grounds raised by the assessee in the appeal are allowed for statistical purposes.