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Facts
The assessee, Sangam Eanta Udyog (a brick kiln business), did not file its return for AY 2015-16. Proceedings under Section 147 were initiated, and after filing a return, the Assessing Officer made an ex-parte addition of Rs. 52,00,500/- for unexplained cash deposits in the bank. The CIT(A) dismissed the assessee's appeal, leading to the current appeal before the Income Tax Appellate Tribunal.
Held
The Tribunal upheld the CIT(A)'s order, finding it to be just, fair, and well-reasoned. The assessee failed to reconcile the significant variation between total bank credits (including cash deposits) and reported sales, and did not provide sufficient details like purchase bills, sales invoices, or a cash book to substantiate the generation of cash. Thus, the Tribunal found no reason to interfere with the conclusions of the lower authorities.
Key Issues
Validity of assessment proceedings under Section 147/148 without proper satisfaction or Section 143(2) notice. Justification of addition under Section 69A for unexplained cash deposits claimed as business sales.
Sections Cited
147, 144, 148, 143(2), 69A, 144B, 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ALLAHABAD BENCH, ALLAHABAD
Before: SHRI ANADEE NATH MISSHRA & SHRI SUBHASH MALGURIA
2015-16 against impugned appellate order dated 08/01/2025 (DIN & Order No.ITBA/NFAC/S/250/2024- 25/1071978170(1) of Commissioner of Income Tax (Appeals) [“CIT(A)” for short]. The grounds of appeal are as under:
“1. That in any view of the matter assessment framed on income of Rs.53,12,010/- by order dated 08.03.2023 u/s 147 r.w.s. 144 of the Act is highly unjustified.
That in any view of the matter the proceeding as initiated is not a valid proceedings as there was no concealment of income nor any proper satisfaction was recorded about concealment of income hence entire action u/s 147 of the Act is not a judicious action in the eye of law.
That in any view of the matter after filling of return incompliance to notice u/s 148 of the act no notice u/s 143(2) of the Act was issued which is mandatory requirement under the Act hence in absence of proper service of notice assessment liable to be declared annulled.
That in any view of the matter addition of Rs.52,00,500/- as made by the assessing officer on account of cash deposit in bank as added u/s 69A of the act is highly unjustified.
That in any view of the matter was wrong in adding Rs.52,00,500/- when the same represent sale proceed of assessee business and the sale cannot be termed income of the assessee hence the addition made is highly unjustified.
That in any view of the matter the difference in bank deposit as well as sales as shown by the assessee is fully explained and was from definite sources hence the finding and observation in the order is highly unjustified.”
(B) The facts of the case, in brief, are that the assessee is a firm and engaged in brick klin business. For the year under consideration the assessee had not filed its return of income. Proceedings u/s 147 were initiated by issue of notice u/s 148 of the Act. In compliance to said notice, the assessee filed its return on 31/01/2023 declaring total income of Rs.1,11,510/-. The Assessing Officer processed the return filed by the assessee and passed ex-parte assessment order under section 147 read with section 144B of the Act on 08/03/2023 and made an addition of Rs.52,00,500/- on account of cash deposits made by the assessee. Aggrieved, the assessee carried the matter in appeal before the learned CIT(A). Vide impugned appellate order dated 08/01/2025, the assessee’s appeal was dismissed by the learned CIT(A). Aggrieved further, the assessee is in appeal before the Income Tax Appellate Tribunal.
(C) At the time of hearing before the Tribunal, none was present on behalf of the assessee. In absence any representation from assessee’s side, learned Departmental Representative was heard and materials available on record were perused. The learned Departmental Representative placed strong reliance on the assessment order and the impugned appellate order of learned CIT(A). For the ease of reference, relevant portion of the impugned order of learned CIT(A) is reproduced below:
(C.1) We are of the view that the impugned order of learned CIT(A) is just and fair having regard to facts and circumstances of the case, and applicable law. The learned CIT(A) has passed a well reasoned and speaking order. No material has been brought for our consideration to persuade us to take a view different from the view taken by learned CIT(A). Therefore, the impugned order of learned CIT(A) is upheld and the appeal is dismissed. (D) In the result, the appeal is dismissed for statistical purposes.
(Order pronounced in the open court on 30/10/2025)