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Facts
The assessee, a small hardware business owner, had an addition of Rs. 4,46,500/- made to his income under section 69A for cash deposits in his bank account for A.Y. 2017-18. The assessment was completed ex-parte under section 144 due to non-submission of documents, and the CIT(A) dismissed the appeal for lack of follow-up from the assessee. The assessee, aged 74, contended that the cash was from business receipts and the addition violated a CBDT instruction for senior citizens.
Held
The Tribunal observed that the assessee was not properly represented before the lower authorities and thus remitted the matter back to the Assessing Officer for a fresh adjudication (de novo). The AO was directed to grant a proper and adequate opportunity of being heard, admit all evidence, and adjudicate the case on merits, specifically considering the CBDT instruction for cash deposits by senior citizens.
Key Issues
Whether the addition under section 69A for cash deposits was justified given the assessee's age and a relevant CBDT instruction; and whether the assessee was provided adequate opportunity to present his case before the lower authorities.
Sections Cited
Section 250, Section 148, Section 144, Section 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.
Before: SH. UDAYAN DAS GUPTA & SH. BRAJESH KUMAR SINGH
ORDER Per: Brajesh Kumar Singh, AM: The instant appeal of the assessee is directed against the order of the ld. Addl. /Joint Commissioner of Income Tax (Appeal),-2, Lucknow, [in brevity the ‘CIT (A)’] dated 23/09/2024 passed u/s 250 of the Income Tax Act 1961, [in brevity the Act] for A.Y. 2017-18. 2. Assessee has filed an application for condonation of delay of 44 days. Wherein, the assessee had explained the delay & prayed for condoning the delay.
The ld. Sr. DR has not made any strong objection against the condonation. The delay of 44 days is condoned. The appeal of assessee is taken for hearing. 3. The assessee has taken the following grounds: “
1. That the Ld. CIT(A) has erred in law and on facts dismissing the appeal, as assessee fail to file reply due to the reasons beyond his control.
2. That the Ld. CIT(A) has erred in laws while adjudicating the facts that addition under section 69A was made when no books of accounts are maintained by assessee.
3. That the facts and in the circumstances of the case and in law. the learned CIT (A), erred in adjudicating the merit of case wherein that the cash deposit in the J&K bank account was used for business purpose only.
4. That the facts of the case assessee bank credits were from his business receipt only.
5. Your appellant craves, leave, to add, alter, amend, and/or forego any of the grounds of appeal at the time of hearing.”
4. Brief fact of the case is that the ld. AR submitted that the assessee is running a small business of hardware and he earned nominal profit. Notice under section 148 was issued on the point of cash deposit in the bank account and AO completed the assessment under section 144 of Income Tax Act 1961 for non-submission of any documents/detail by assessee during assessment proceeding. The Ld. AO had made addition of Rs. 4,46,500/- under section 69A as cash deposit in business account of assessee. The Ld. CIT(A) dismiss the appeal as no reply as filed before him.
Being aggrieved assessee filed an appeal before us.
During hearing before ITAT, the ld. AR filed written submission which are kept in the record the ld. AR has contended that the opportunity was not provided to the assessee to support his case.
The ld. CIT(A) only on point of lack of follow up made by the applicant to discharge his onus. So, the assessee was unable to present the matter before the AO the relevant observation of the ld. CIT(A) is as under: “It is clear from the above that none of the grounds are maintainable. In view of above discussion and in lack of any follow up made by applicant to discharge his onus, the appeal cannot be accepted. Same is the position in case of all allowances, deductions, claims or loss, etc. Since an appeal is nothing but the claim of the appellant that he has been unduly unjustifiably taxed, it is for the appellant to prove his case. The appellant has not availed any opportunity to do so. From the conduct of the appellant as per the facts noted above, it is clear that the appellant does not wish to pursue the appeal. Even otherwise on the merits of it also, I do not see any reason to differ with the findings of the AO since no attempt has been made by the assessee to discharge its onus. In my considered view, the findings of the AO in the assessment order are self-speaking and do not require any interference. Hence the appeal is liable to be dismissed.”
The ld. AR further informed that the cash was deposited in bank account, there is sufficient explanation with assessee against the addition. Only ground the assessee was unable to explain the same before the ld. AO. The ld. AO made the addition of Rs.4,46,5000/- u/s 69A. The ld. AR referred to the CBDT Instruction of cash deposit up-to Rs. 5,00,000/- in the case of senior citizen above 70 years CBDT had issued an instruction no 3 of 2017, which says that no verification is required for cash deposit up to Rs. 5.00 lacs (Para no, 3 of Annexure to Instruction no 3 of 201 7) if the assessee is more then 70-years old. It was submitted that in this case the assessee was around 74 years at the time of verification and assessment and this addition was in clear violation of the CBDT instruction which were binding on the assessing officer.
The ld. DR only relied on the order of both the revenue authorities.
We heard the rival submission and perused the documents available on the record. We find that the assessee was not properly represented before any of the lower authorities. The order of assessment is passed by the ld. AO u/s 144. So, in our considered view, we remit back the matter to the ld. AO for fresh adjudication de novo. Needless to say, that the AO shall provide proper and adequate opportunity of being heard to the assessee in set aside proceedings. The evidence/explanations submitted by assessee in his defence shall be admitted by AO and adjudicated on merits in accordance with law. We order accordingly.
10.1 Since we have remanded the matter for fresh consideration, the grounds on merits are academic and not adjudicated.
Order pronounced in the open court on 30.05.2025