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Facts
The assessee, a cooperative credit society, filed its income tax return for A.Y. 2017-18 claiming deduction under Section 80P. During scrutiny, the Assessing Officer (AO) found unexplained cash deposits during F.Y. 2016-17 and, not satisfied with the assessee's explanations, made an addition of Rs. 48,16,818/- under Section 68 for unexplained cash credits. The CIT(A) confirmed the AO's action, leading the assessee to appeal before the Tribunal.
Held
The Tribunal condoned a 41-day delay in filing the appeal and admitted additional evidence filed by the assessee under Rule 29 of ITAT Rules. Given the importance of the evidence, the Tribunal restored the disputed issues, along with the additional evidence, to the CIT(A) for fresh verification and adjudication on merits, providing the assessee an adequate opportunity of hearing.
Key Issues
Whether the addition made under Section 68 for unexplained cash credits was valid, and whether additional evidence submitted under Rule 29 of ITAT Rules should be admitted and considered by lower authorities.
Sections Cited
143(3), 250, 68, 80P, 143(2), 142(1), Rule 29 of ITAT Rules
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PANAJI BENCH
Before: SHRI PAVAN KUMAR GADALE & SHRI G D PADMAHSHALI
सुनवाई क� तार�ख/Date of Hearing 01.07.2025 घोषणा क� तार�ख/Date of Pronouncement 02.07.2025 ORDER
PER PAVAN KUMAR GADALE, JM:
The appeal is filed by the assesse against the order of the NFAC Delhi/CIT(A) passed u/sec 143(3) and u/sec 250 of the Act..
At the time of hearing, the Ld.AR of the assessee submitted that there is a delay of 41 days in filing the appeal before the Hon’ble Tribunal and the assesse has filed the application for condonation of delay. Whereas, the facts mentioned are reasonable and the Ld. DR has no specific objections. Accordingly, we condone the delay and admit the appeal. The assessee has raised the grounds of appeal challenging the order of the CIT(A) sustaining the addition u/se 68 of the Act made by the Assessing Officer.
3. The brief facts of the case are that, the assessee is a cooperative credit society engaged in providing credit facilities to its members. The assesse has filed the return of income for the A.Y 2017-18 on 26.08.2017 disclosing a total income of Rs. Nil after claiming deduction u/sec 80P of the Act. Subsequently the case was selected for scrutiny under CASS and notice u/sec143(2) and u/sec 142(1) of the Act are issued calling for details in respect of claims and the information supporting the return of income filed. The assesse has filed the details and the Assessing Officer (A.O) has dealt on the submissions/details and find that there are cash deposits during the F.Y.2016-17 and the assessee was asked to explain the sources of deposits. Whereas the assesee has filed the financial statements and supporting information in respect of deposits along with bank statement and members list. The A.O. was not satisfied with the explanations and dealt on the provisions of section 68 of the Act and made addition of unexplained cash credits and assessed the total income of Rs.48,16,818/- and passed the order u/sec 143(3) of the Act dated 28.12.2019.
Aggrieved by the order, the assessee has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts, findings of the AO and submissions of the assesse but has confirmed the action of the Assessing officer and dismissed the assessee appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon'ble Tribunal.
5. At the time of hearing, the Ld.AR submitted that the CIT(A) has erred in confirming the action of the A.O overlooking the facts and submissions of the assessee in the proceedings. Further the Ld.AR submitted that the assessee has a good case on merits and has filed an application for admission of the additional evidence under Rule 29 of ITAT rules and substantiated the submissions with paperbook. Per contra, the Ld. DR submitted that the evidences were not examined by the lower authorities and the Ld. DR supported the order of the CIT(A).
We heard the rival submissions and perused the material on record. The sole crux of the disputed issue that the CIT(A) has erred in confirming the addition made u/sec68 of the Act as the transactions are not supported with the documentary evidences. The Ld.AR emphasized that the assesse has submitted the details as called for by the authorities. The assessee is filling the application for admission of additional evidences under Rule 29 of ITAT rules with details of cash transactions and KYC details of members in respect of cash deposits which could not be submitted before the lower authorities. Further the evidences play a important role in decision making in the adjudicating proceedings. Therefore considering the facts, circumstances and additional evidences, the assessee should not suffer for non filing of material information, as the evidences play a vital role in decision making and we admit the additional evidence. Accordingly, to meet the ends of justice, we restore the disputed issues along with the additional evidence to the file of the CIT(A) to verify and adjudicate afresh on merits and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of appeal. And, we allow the grounds of appeal of the assessee for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.