NAGAIAH MARUTHAI,DINDIGUL vs. ITO, WARD-1,, DINDIGUL
Facts
The assessee, engaged in wholesale fruit trading, had cash deposits exceeding their declared turnover. The Assessing Officer (AO) reopened the assessment under Section 147 and added Rs. 1,99,63,320 as unexplained cash deposits after the assessee failed to respond to notices. The CIT(A) confirmed this addition.
Held
The Tribunal noted that the assessee, a wholesale fruit vendor, lacked technical knowledge and was dependent on counsel who allegedly mishandled the case. The assessee also claimed cash was received for credit sales in earlier years. Considering the circumstances, the Tribunal decided to grant the assessee one more opportunity.
Key Issues
Whether the addition of Rs.1,99,63,320 as unexplained cash deposits was justified, and whether the assessee was given a proper opportunity to present their case before the lower authorities.
Sections Cited
147, 148, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & MS. PADMAVATHY.S
आदेश / O R D E R
PER PADMAVATHY.S, A.M: This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short "CIT(A)") passed u/s. 250 of the Income Tax Act, 1961 (in short "the Act") dated 06.11.2025 for Assessment Year (AY) 2020-21.
The assessee is an individual and is engaged in the business of wholesale trading of fruits. The assessing officer (AO) reopened the
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assessment for the reason that the assessee has made cash deposits which is more than the turnover declared by the assessee in the return of income. The AO issued a notice under section 148 and also other notices calling for various details. Since the assessee did not respond to the notices the AO completed the assessment under section 147 were he made an addition of Rs.1,99,63,320 as unexplained cash deposits. Aggrieved, the assessee filed further appeal before the CIT(A). The assessee submitted that cash would have been received towards the credit sales made during the earlier years and therefore they cannot be any addition made towards unexplained cash deposit. The CIT(A) did not accept the submissions of the assessee and confirmed the addition made by the AO. The assessee is in appeal before the tribunal against the order of the CIT(A).
We heard the parties and perused the material on record. The Ld. AR submitted that the assessee is a wholesale fruit vendor and does not have the technical knowledge to access computers. The Ld. AR further submitted that the assessee therefore is completely dependent on counsel with regard to income tax matters who did not handle assessee's case properly. Accordingly the Ld. AR submitted that the assessee did not appear before the AO. The Ld. AR also submitted that in the line of business the assessee is engaged in the turnover is done in cash and the assessee has received cash against certain credit sales made during the earlier years. The Ld. AR submitted that before the CIT(A), the assessee could not represent the case properly because the CIT(A) has issued only one notice and did not call for any further details. The Ld. AR accordingly, prayed that the assessee be given one more opportunity be given to represent the case properly before the lower authorities. Considering the facts and circumstances unique to the assessee's case, we are inclined to give one more opportunity to the assessee by remitting the appeal
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back to the AO. The AO is directed to consider the impugned issue afresh by calling for necessary details and decide the case in accordance with law. The assessee is directed to file necessary documents in support of the impugned additions made by the AO and cooperate with appellate proceedings without seeking unnecessary adjournments. It is ordered accordingly.
Further, we also levy a cost of Rs.7,000/- (Seven thousand only) in the appeal since considerable time and efforts have been spent by the Exchequer and for the reason that the assessee being delinquent before the lower authorities. The same shall be paid by the assessee to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras within a period of one month from the date of receipt of this order and produce the receipt before the AO.
In result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 25th day of February, 2026 at Chennai.
Sd/- Sd/- (एबी टी. वक�) (पदमावती यस) (ABY. T. Varkey) (Padmavathy.S) �याियक �याियक सद�य �याियक �याियक सद�य सद�य / Judicial Member सद�य लेखा लेखा सद�य लेखा लेखा सद�य सद�य /Accountant Member सद�य चे�नई/Chennai, �दनांक/Dated: 25th February, 2026. EDN, Sr. P.S आदेश क� �ितिल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकर आयु�/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय �ितिनिध/DR 5. गाड� फाईल/GF
