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Facts
The assessee appealed against the CIT(A)'s order confirming an addition of Rs. 61,12,000/- for unexplained cash deposits in the bank account. The assessee claimed these deposits were from the trading of edible oil, supported by audited accounts, balance sheets, P&L, bank statements, and sales reports.
Held
The Tribunal noted that the assessee provided substantial evidence and explained the source of deposits. It was also observed that the lower authorities did not properly consider the evidence. The DR suggested restoring the matter to the AO for proper examination.
Key Issues
Whether the addition of Rs. 61,12,000/- on account of unexplained cash deposits in the bank account was justified without proper appreciation of the evidence provided by the assessee?
Sections Cited
69A, 250
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Income Tax Appellate Tribunal, PATNA BENCH, VIRTUAL HEARING AT KOLKATA
Before: SRI SANJAY GARG & SHRI SANJAY AWASTHI
order
: 22.01.2025 ORDER
Per Sanjay Garg, Judicial Member:
The captioned appeal has been preferred by the assessee against the order dated 05.09.2023 of the Ld. Commissioner of Income Tax (Appeal), National Faceless Appeal Centre, Delhi [hereinafter referred to as Ld. ‘CIT(A)’] u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) for Assessment Year (AY) 2017-18.
The assessee in this appeal is aggrieved by the action of the Ld. CIT(A) in confirming the addition of Rs.61,12,000/- u/s. 69A of the Act on account of unexplained cash deposits in the bank account.
At the outset, the Ld. Counsel for the assessee has submitted that the assessee had duly explained before the Assessing Officer that the assessee was engaged in the business of trading of edible oil. That the aforesaid deposits were out of the sales/turnover of the assessee. That the assessee furnished the relevant documents including audited statement of its account, Balance Sheet, P&L Account, copy of bank statement and even month wise
I.T.A. No.: 313/PAT/2023 Varun Kumar Agrawal, AY : 2017-18 purchase and sales, cash compliance report and even all the quarterly VAT returns. The Ld. Counsel for the assessee has further submitted that the impugned cash deposits were just 5% of its total turnover. That the Assessing Officer demanded the cash book. However, it was submitted that the cash book was voluminous and that the same could not be uploaded and time was sought to furnish the same. However, the Assessing Officer, without giving any time in this respect, made the impugned addition. The Ld. Counsel for the assessee has further submitted that even the Ld. CIT(A) has also failed to take note of the voluminous evidence furnished by the assessee to prove the source of the deposit in the bank account. He, therefore, has submitted that both the lower authorities, without properly considering and appreciating the evidence on the file, have made the impugned addition.
The Ld. DR, on the other hand, has submitted that since the evidence on the file has not been properly examined by the lower authorities, therefore, the matter may be restored to the file of the Assessing Officer for verification of the facts.
Considering the rival submissions, we are of the view that in this case, it may be appropriate to restore the matter to the file of the Assessing Officer with a direction to examine the contentions raised by the assessee and if it is found that there was sufficient cash receipts of the assessee out of its sales etc. which were deposited in the bank account, then, no addition would be warranted. We accordingly, restore the matter to the file of the Assessing Officer for examination of the issue afresh after considering the relevant evidences and explanations on the file.
In the result, the appeal of the assessee is treated as allowed for statistical purposes.