RAM KUMAR,SUPAUL vs. ITO, 3(5), SAHARSA
Facts
The assessee filed an appeal before the Tribunal after a delay of 156 days, citing illness and non-communication of the lower appellate order. The Assessing Officer (AO) initiated proceedings under section 147 and added cash deposits of ₹17,25,000/- made during the demonetization period, along with a profit rate of 8%, resulting in total income of ₹17,95,672/-.
Held
The Tribunal noted that the CIT(A) had not passed a speaking order on merits and had directed the AO to conduct verification, which was beyond the CIT(A)'s powers after June 1, 2001. The Tribunal held that the CIT(A)'s order was not sustainable as it was based on a non-application of mind and lacked proper adjudication.
Key Issues
The primary issues were the condonation of delay in filing the appeal, the validity of the addition of cash deposits under section 69A, the application of section 115BBE, and the proper adjudication of grounds by the CIT(A).
Sections Cited
250, 147, 148, 69A, 115BBE, 234A, 234B, 251
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Income Tax Appellate Tribunal, PATNA BENCH AT KOLKATA
Before: SHRI SONJOY SARMA & SHRI RAKESH MISHRA
आयकर अपीलीय अधिकरण पटना पीठ, कोलकाता में IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH AT KOLKATA [वर्चुअल कोटु] [Virtual Court] श्री संजय शमाु, न्याधयक सदस्य एवं श्री राकेश धमश्रा, लेखा सदस्य के समक्ष Before SHRI SONJOY SARMA, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER I.T.A. No.: 464/PAT/2024 Assessment Year: 2017-18 Ram Kumar ITO, Ward-3(5), Saharsa Vs. (Appellant) (Respondent) PAN: BDFPK8001C Appearances: Assessee represented by : K N Prasad, Adv. and Vishal Kr. Adv. Department represented by : Ashwani Kr. Singal, JCIT. Date of concluding the hearing : February 4th, 2025 Date of pronouncing the order : February 19th, 2025 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2017-18 dated 28.11.2023,
In this case, the addition is towards the cash deposits of Rs. 17,25,000/- into the bank accounts in Axis Bank and estimated profit on the said turnover amounting to Rs. 70,672/-. In the impugned assessment order, the AO has made an addition of Rs. 17,95,672/- Aggrieved by the said addition, the appellant is in appeal and has raised 6 grounds, which are adjudicated as unde:r
Ground No. 1 is regarding addition of Rs. 17,05,672/- made by the AO towards cash deposits and profits earned. For this impugned AY, the addition is towards the cash deposits into the bank accounts in Axis Bank. By going through the appellant's case, it is claimed that appellant has a business the income from which is offered to tax u/s 44AD of the Act. The AO has reopened the assessment on the basis of information received from the bank and completed the assessment accordingly. The appellant is seen to be non co-operative in submissions of the details.
6.1 Further, the cash deposits during demonetization period have to be considered with reference to the cash in hand as on the demonetization date. It is the claim of the appellant that total deposits during demonetization period is only Rs. 1,50,000/- (Rs. 70,000/- in Axis Bank Account No. 8389 and Rs. 80,000/- in Account No. 8823). According to appellant, the AO has held that entire cash deposit during FY 2016-17 has been considered as deposit during the demonetization period. The appellant has not produced any details before the AO. The details produced during appellate proceedings for the first time amount to additional evidence for which the appellant has not furnished any reasons as provided in Rule 46A of the IT Rules, as to why these details were not produced before the AO and why these details should be admitted as additional evidence during the appellate proceedings. Therefore, the additional evidences produced during appellate proceedings are not admitted. 6.2 To take the appellant's case to a logical conclusion, the appellant is given an opportunity to produce the details before the AO within 15 days from the date of receipt of this appellate order and AO shall pass the order giving effect to this appellate order within next two weeks. The AO shall verify the cash in hand of the appellant as on the demonetisation date and even the cash deposits made by the appellant during the demonetisation period in the bank accounts. The appellant was not expected to receive any demonetised notes after the announcement of demonetisation. He was expected only to deposit the cash in hand as on
4.1 Thus, although the Ld. CIT(A) did not admit the additional evidence yet instead of calling for a remand report and deciding the issue, he directed the Ld. AO to carry out the necessary verification and give a finding whether the addition made was justified or not. Before us the Ld. AR submitted that written submission was filed before the Ld. CIT(A), but the same was not considered while deciding the appeal and he requested that the assessee may be granted another opportunity to represent his case properly. We find that the direction given by the Ld. CIT(A) is tantamount to setting aside the assessment order to the Ld. AO, which power has been withdrawn with effect from 01.06.2001. In this respect, it is relevant to examine the provisions of section 250(6) which are reproduced as under:
Assistant Registrar ITAT, Kolkata Benches Kolkata
