VIPUL LALLUBHAI KUKADIYA,SURAT vs. ITO, WARD 2(3)(4), SURAT

िनधा�रती की ओर से /Assessee by Shri Kamlesh Bhatt, CA राज� की ओर से /Revenue by Shri Mukesh Jain, Sr-DR सुनवाई की तारीख/Date of hearing 08.01.2025 उद्घोषणा की तारीख/Date of 04.03.2025 pronouncement Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee is directed against the order of National Faceless Appeal Centre, Delhi [for short to as “NFAC/Ld.CIT(A)] dated 06.08.2024 for assessment year (AY) 2016-17, which in turn arises out of assessment order passed by Assessing Officer under section 144 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 20.11.2018. The assessee has raised following grounds of appeal:

1. In view of the facts and circumstances of the case the Ld. CIT(A), NFAC, New Delhi erred in law and in facts, in not appreciating the facts of the case and the evidence & thereby confirming the addition of Rs.1,61,69,485/- u/s 69A and hence your appellant prays that the addition being unfair, illegal and in total disregard of the facts, be deleted.”

2. Rival submissions of both the parties have been heard and record perused. At the outset of hearing, the learned Authorised Representative (ld. AR) of the (A.Y.16-17) Vipul L Kukadiya assessee submits that there is delay of 5 days in filing appeal before the Tribunal. The delay is neither intentional nor deliberate. The assessee has filed his affidavit in explaining the reasonable and sufficient cause for condonation of delay. The Ld. AR of the assessee submits that impugned order was passed by Ld. CIT(A) on 06.08.2024. The assessee was out of station and came back Surat on 09.08.2024 and opened his e-mail on 10.08.2024. On opening e- mail, the assessee found copy of impugned order in his e-mail thus, the order was communicated to the assessee only on 10.08.2024. The assessee paid required appeal fees on 08.10.2024 i.e., well within time from the date of communication of order. From 08.10.2024, the assessee was not feeling well and could not attend his routine activities thus, he could not sign appeal paper, which were ultimately signed on 12.10.2024 and this appeal was filed thereafter. The delay was neither intentional nor deliberate on the part of assessee. The assessee is interested in pursuing his appeal. Otherwise, the delay very small and may be condoned in the interest of justice.

3. On merit, the ld. AR of the assessee submits that assessment was completed under section 144 of the Act on 20.11.2018. The Assessing Officer made addition on account of cash deposit of Rs.79,94,600/- as well as other credit by way of cheque/NEFT of Rs.1.65 crores in his bank account with ICIC bank aggregating of Rs. 2.45 Crore. The Ld. AR of the assessee submits that in response to notice dated 10.11.2018, assessee sought adjournment for 10 days, which was not allowed. The Assessing Officer passed assessment order on 20.11.2018. The Assessing Officer made addition of entire cash deposit and other credit in the bank account of assessee. The entire cash deposit and (A.Y.16-17) Vipul L Kukadiya other credit can never be treated as income of assessee under Income-tax proceedings. The assesse was engaged in trading of mobile phones and accessories thereof. The assessee has declared total turnover as per his return of income at Rs.83.43 lakhs and offered income under section 44AD of the Act. The cash deposit and other credit were out of business receipt and not from undisclosed source. The assessee is maintaining only one bank account. There is regular deposit and withdrawal of amount in his bank account, which clearly shows regular business transaction. The Assessing Officer has not considered periodical withdrawal. Before Ld. CIT(A) assessee filed application for admission of additional evidence in support of various contention, in the statement of fact as well as submission made before Ld. CIT(A). The assessee also filed revised computation of income showing higher turnover of his business. The additional evidence was forwarded to the Assessing Officer for his remand report. The Assessing Officer furnished his remand report on 06.06.2024. The contents of remand report are recorded in para-5.2 of impugned order. In the remand report, Assessing Officer objected for admission of additional evidence by taking plea that assessee has not given any reason for non-compliance of notice during the course of assessment proceedings. And that the assessee does not fulfil the condition prescribed in Rule 46A of Income Tax Rules, 1962, for admission of additional evidence. On merit, the Assessing Officer in his remand report submitted that assessee has under reported business transaction recorded in the bank account at the time of filing return of income. The assessee is now submitted revised financial statement which is actual business transaction of assessee i.e. total sales at (A.Y.16-17) Vipul L Kukadiya Rs.2.45 crores. As per earlier stand, the assessee reported sales to the tune of Rs.1.61 crores. Thus, assessee under reported his sales, the assessee took excuse that wrong has been done by his accountant without his knowledge. On the contention of assessee that maximum peak balance in his account during the year as on 19.09.2015 was received Rs.8,57,004/- only, the Assessing Officer not accepted such contentions by holding that credit entries has not been explained fully. However, no comments were given of peak balance during the year. The ld. AR of the assessee submits that on the remand report, assessee has filed his objection/rejoinder and he stated that entire business receipt can never be income of assessee. The Appellate Authority are empowered to admit such additional evidence. Additional evidence was not accepted by ld. CIT(A) and he upheld the addition to the extent of Rs.1.16 crores by taking view that assessee has disclosed certain turnover to the extent of Rs.84.43 lakhs. The Ld. AR of the assessee submits that neither the Assessing Officer allowed opportunity to the assessee nor the ld. CIT(A) considered the facts of the case in a proper perspective. The assessee was in the business of selling of mobile and their accessories and lower authorities have not considered the fact in a proper way. The transaction in bank account can never be considered as a sole criterion for determining income of the assessee. The Ld.AR of assessee submits that additional evidence was relevant for the purpose of determination of issue involved in the present appeal, therefore, additional evidence may be admitted for proper adjudication of the issue and matter may be restored back to the file of Assessing Officer to pass order afresh in accordance with law.