What did the Tribunal hold?

The Tribunal allowed the appeal for statistical purposes and remitted the issue back to the AO, granting the assessee another opportunity to explain the source of the cash deposits.

The assessee failed to appear before the AO and CIT(A) despite notices. An addition of Rs. 10,77,000/- was made regarding the source of cash deposits, including during demonetization, which was confirmed by the CIT(A).

What were the issues?

Whether the assessee should be given another opportunity to explain the source of cash deposits, especially during demonetization, before the AO?

ACIT vs M/S. the Fertilizer Corporation… | ITAT Delhi 2025

Income Tax Appellate Tribunal, “SMC” BENCH, DELHI

Before: MS. MADHUMITA ROY

Hearing: 18.03.2025Pronounced: 13.06.2025

The instant appeal was filed by the assessee against the order dated 11.12.2023 passed by the NFAC arising out of the order passed by the ITO, 2(3)(2) Bulandshahar under Section 144 of the Act for Assessment Year 2017-18.

The issue involves in this particular case is the addition in respect of source of cash deposit to the tune of Rs.10,77,000/- including cash deposit of Rs.10,04,000/- during demonetization period. The assessee neither appeared before the Ld. AO nor before the Ld. CIT(A) in spite of notices being served and hence, the addition was made by the Ld. AO to the tune of Rs.10,77,000/- which was further confirmed by the First Appellate Authority. Hence, the instant appeal before us.

4. Having regard to the facts and circumstances of the matter, it appears that in order to prevent the miscarriage of justice the assessee be given a further opportunity of being heard to represent its case effectively particularly to explain the source of the impugned cash deposit made by him including the cash deposit during demonetization before the Ld. AO. Thus, the appeal is disposed of by remitting the issue to the file of the Ld. AO to decide the same upon granting an opportunity of being heard to the assessee and upon considering the evidences on record or any other evidence which the assessee may chose to file at the time of hearing of the matter. It is also made clear that if the assessee Imamuddin (AY: 2017-18) does not cooperate with the Ld. AO the said authority would be at liberty to dispose of the issue strictly in accordance with law.

The appeal of the assessee is allowed for statistical purpose.

Order pronounced in the open court on 13.06.2025

ACIT, NEW DELHI vs. M/S. THE FERTILIZER CORPORATION OF INDIA, NOIDA

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