SHEI RAJIV NAGARI PATASAVNSTHA MARYA HITANI,GADHINGLAJ vs. INCOME TAX OFFICER WARD 1 KOLHAPUR , KOLHAPUR

This appeal of the assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“CIT(A)/NFAC”], dated 23.05.2025 pertaining to the Assessment Year (“AY”) 2019-20.

Although a number of grounds have been raised by the assessee, however, these all relate to the order of the Ld. CIT(A)/NFAC in sustaining the addition(s) made by the Ld. Assessing Officer (“AO”) of Rs.1,24,11,396/- on account of unexplained cash deposit and Rs.30,00,000/- on account of unexplained cash credits u/s 68 of the Income Tax Act, 1961 (the “Act”) being cash and time deposits with ICICI Bank and Shri Veershaiv Co-op. Bank Ltd. respectively and thereby rejecting the assessee’s claim of deduction u/s 80P(2)(a)(i) of the Act.

None appeared for/on behalf of the assessee when the case was called for hearing on 04.12.2025. The assessee failed to appear even on the earlier dates fixed for hearing on 01.09.2025, 21.10.2025 & 10.11.2025. However, the Ld. DR was present on all the above dates of hearing. Under these circumstances, we deem it fit to adjudicate the appeal with the assistance of Ld. DR and the material available on record.

We have heard the Ld. DR and perused the order of the Ld. AO and CIT(A)/ NFAC. The assessee is a Co-operative society registered under Maharashtra Cooperative Society Act, 1960. The assessee did not file its return of income for the AY under consideration. Based on the information flagged by CBDT under the head NMS, the assessee was issued with a notice u/s. 148 of the Act after following the due procedure and obtaining necessary approval from the competent authority as laid down udder the relevant provisions of the Act. In response thereto, assessee filed its return of income declaring income at Rs.3,28,590/-. Statutory notices u/s 143(2) and 142(1) of the Act followed by show cause notice were issued and served upon the assessee, in response to which the assessee filed certain details/ reply. During the course of assessment proceedings, the Ld. AO noted that a sum of Rs.90,000/- was offered as received from Kolhapur District Central Co-op. Bank Ltd. on which TDS has not been deducted. He further noted that the assessee society has claimed deduction u/s 80P(2)(a)(i) of the Act for sum of Rs.1,54,11,396/- (Rs.1,24,11,396/- + Rs.30,00,000/-) in respect of cash deposits and time deposits with ICICI bank and Shri Veershaiv Cooperative Bank Ltd, respectively during the relevant AY 2019-20. After considering the submissions made by the assessee, the Ld. AO concluded that the assessee failed to explain the source of cash and time deposits with supporting documentary evidences inspite of several opportunities granted to the assessee to provide the requisite details. He therefore completed the assessment at total income of Rs.1,57,39,986/- u/s 147 r.w.s. 144B of the Act, vide his order dated 27.02.2024 thereby making an addition of Rs.1,24,11,396/- as unexplained cash deposit and Rs.30,00,000/- as unexplained cash credits u/s 68 of the Act and disallowed the claim of deduction u/s 80P(2)(a)(i) of the Act. On appeal, the Ld. CIT(A)/NFAC dismissed the appeal of the assessee by applying the provisions of section 249(4) of the Act as the assessee has not paid the tax due on income declared in its return of income by observing as under: “5.4 on perusal of the said return it appears that the appellant as an AOP (Co-operative Society) has suo-motto disclosed total income of Rs.3,28,590/- only. No deduction under chapter VI-A was claimed by the appellant in the return filled in response to notice u/s 148. It appears that the tax due on such income is Rs.1,95,866/- only, (including interest) which was duly acknowledged by the appellant. However, no taxes were paid on declared total income either in the form of advance tax, TDS or self assessment tax by the appellant, for the noted year. The disclosure made in the return in the appeal memo is also reproduced below: