SUJATHA SUNKARA BY L/R GANGA RAO SUNKARA,NIZAMABAD vs. ITO, WARD- 3, NIZAMABAD, NIZAMABAD

6. Ld. AO and Ld. CIT(A) failed to appreciate that the copies of the bank accounts were filed which prove the transfer of sale proceeds to IOC and receipt of sale proceeds were confirmed by the IOC.

3 ITA.No.1844/Hyd./2025

9. Ld. AO failed to appreciate the nature of business of the assessee and the entire tum over cannot the income and wrongly invoked the provisions of Section 115BBE.

10. Ld. AO failed to appreciate that the assessee received commission of Rs.9,58,522 (Gross) and net income was a sum of Rs.3,16,210.

3. In ground no.2 the assessee has challenged the validity of the impugned order passed by the learned CIT(A) without bringing the legal representatives of the deceased assessee on record.

4 ITA.No.1844/Hyd./2025 4. The learned Authorised Representative of the Assessee has submitted that the impugned order passed by the learned CIT(A) is not valid and bad in law when it is passed against the deceased person. He has referred to page- 8 of the impugned order and submitted that the learned CIT(A) has acknowledged the fact that the assessee died on 26.04.2023 and Death Certificate was submitted before the learned CIT(A). However, the impugned order was passed in the name of the deceased assessee without bringing the legal representatives on record. In support of his contention, he has relied upon the following decisions:

5 ITA.No.1844/Hyd./2025 5. On the other hand, the learned DR has submitted that despite the demise of the assessee during the pendency of the appeal before the learned CIT(A) the legal representatives of the assessee have not amended the Form- 35 and brought on record the legal representatives and therefore, the appeal of the assessee ought to have been dismissed being abated. The learned DR has thus submitted that once the assessee has not brought the legal representatives on record, it would not render the impugned order as invalid, but the appeal of the assessee ought to have been dismissed as abated.

7. In the other grounds of the appeal, the solitary issue raised by the assessee is regarding the assessment of the entire cash deposits in the bank account of the assessee as ‘Income’. The learned Authorised Representative of the Assessee has submitted that the assessee was running a petrol pump owned and operated by the Indian Oil Corporation [in short “IOL”]. He has submitted that this was the petrol pump in the category of “Company Owned and Company Operated [in short “COCO”] and assessee was running the said retail outlet of the IOC and receiving only commission on the sales. He has further submitted that the entire commission income of the assessee was subjected to TDS duly reflected in Form-26AS. Therefore, the deposit in the bank account was not the income of the assessee but it was the sale proceeds of the IOC and assessee was receiving only commission income. He has further submitted that the learned CIT(A) has confirmed the addition made by the Assessing Officer by citing the reasons that documents

8 ITA.No.1844/Hyd./2025 produced by the assessee are not sufficient to explain the source of cash deposit in the bank account and the assessee could have filed certified copy of the ledger account statement from IOC. The learned Authorised Representative of the Assessee has submitted that the assessee duly filed the ledger account in the books of IOC which is placed at Page nos.92 to 99 of the paper book. Thus, the learned Authorised Representative of the Assessee has submitted that the addition made by the Assessing Officer and confirmed by the learned CIT(A) is not sustainable and liable to be deleted.

8. On the other hand, the learned DR has submitted that the assessee has not filed any record to explain the source of the cash deposit in the bank account. The Assessing Officer as well as the learned CIT(A) has given the finding that the assessee failed to explain the source of cash deposit in the bank account. He has relied upon the orders of the authorities below.

9 ITA.No.1844/Hyd./2025 owned and operated by IOC in the category of “COCO” retail outlet. Thus, it is clear that assessee was only earning the commission for operating the said petrol pump on behalf of the IOC without any investment or capital expenditure. The entire commission of the assessee was subjected to TDS as reflected in Form-26AS. The assessee has earned the commission on the sale of petrol and diesel from the petrol pump owned by IOC under the Contract for maintenance and handling to the tune of Rs.9,58,522/-. The transactions in the bank account show the regular deposits and transfer in favour of IOC which suggest that the deposit was prima facie representing sales of the petrol pump. Further, the assessee has also filed the ledger account in the books of IOC showing the transaction of purchase and sale. Therefore, even as per the record available with the Assessing Officer in the shape of the bank account as well as Form-26AS, it is clear that the assessee was having the source of cash as sale from the petrol pump owned by IOC. However, neither the Assessing Officer nor the learned CIT(A) has taken any steps to verify the transactions reflected in the bank account along with the 10 ITA.No.1844/Hyd./2025 ledger account of the assessee in the books of IOC. Hence, prima facie we are of the view that the addition made by the Assessing Officer of the entire cash deposit in the bank account is unjustified. Since the relevant record has not been verified by the authorities below therefore, the impugned order of the learned CIT(A) is set aside and the matter is remanded to the record of the Assessing Officer for proper verification of the relevant facts and particularly, the transaction in the bank account of the assessee along with the ledger account of the assessee in the books of IOC as well as the TDS details in Form-26AS. Needless to say, the assessee be given an appropriate opportunity of hearing before passing the fresh order.

Order pronounced in the open Court on 30.01.2026.