Loading judgment…
Facts
The assessee's case was reopened under section 148 of the Income-tax Act, 1961, due to cash withdrawals of ₹1,07,38,557. The assessee failed to file a return of income and comply with subsequent notices. The Assessing Officer treated the entire cash withdrawal as unexplained and added it to the total income.
Held
The assessee contended that the cash withdrawals were used for agricultural trading. However, the lower authorities found that the assessee failed to appear and provide substantial documentary evidence. The Tribunal noted the assessee's repeated non-compliance and non-prosecution of the appeal.
Key Issues
Whether the cash withdrawals are unexplained income and whether the assessee had sufficient opportunity to present evidence.
Sections Cited
148, 285BA(1), 142(1), 143(2), 147, 144, 144B, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “PATNA BENCH, PATNA
Before: Shri Sonjoy Sarma & Shri Rakesh Mishra
order
: January 09, 2026 आदेश / ORDER
Per Sonjoy Sarma, Judicial Member:
The present appeal filed by the assessee is directed against the order dated 24.04.2025 passed by the NFAC, Delhi u/s 250 of the Income Tax Act, 1961 (the ‘Act’) for the assessment year 2018-19.
Brief facts of the case are that the assessee’s case was reopened by issuance of notice under section 148 of the Income-tax Act, 1961, on the basis of information received through Form 26AS / Statement of Specified Financial Transactions (SFT) under section 285BA(1), indicating cash withdrawals amounting to ₹1,07,38,557 during the relevant previous year. The assessee did not file return of income in response to the notice under section 148. Thereafter, notices under sections 142(1) and 143(2) were issued on various dates. Despite issuance of statutory notices, the assessee failed to comply and did not Birju Kumar furnish any explanation or supporting evidence. Consequently, the Assessing Officer completed the assessment under section 147 read with sections 144 and 144B of the Act, treating the entire cash withdrawal of ₹1,07,38,557 as unexplained and added the same to the total income of the assessee.
Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). Before the Ld. CIT(A), the assessee contended that he was engaged in agricultural trading as a commission agent between farmers and dealers. The amounts withdrawn were utilised for payment to farmers through cheques / RTGS / NEFT against purchase of agricultural produce. However, the Ld. CIT(A) observed that the assessee failed to appear on multiple occasions. No substantial documentary evidence was produced to support the claim the explanation remained unsubstantiated and unverified. Accordingly, the Ld. CIT(A) dismissed the appeal and confirmed the addition of ₹1,07,38,557.
Dissatisfied with the order of the CIT(A) assessee is in appeal before this tribunal. It is admitted fact that when the appeal came up for hearing before the Tribunal, no one appeared on behalf of the assessee on consecutive dates. Considering the repeated non- appearance and non-prosecution by the assessee, the appeal was heard ex parte, with the assistance of the Ld. DR and on the basis of material available on record.
We have carefully considered the submissions of the Ld. DR and perused the records. It is noted that the assessee failed to comply with statutory notices during assessment proceedings and the assessee remained non-compliant even before the Ld. CIT(A) and no documentary evidence such as purchase bills, payment details to farmers, bank statements correlating withdrawals with agricultural Birju Kumar transactions, or commission agreements were furnished. Even before the Tribunal, the assessee has failed to prosecute the appeal or place any material on record to controvert the findings of the lower authorities. In the absence of any supporting evidence, the explanation offered by the assessee remains a mere assertion without proof. In the instant case assessee has failed to comply with notices issued by the Ld. CIT(A) and the impugned order has been passed ex parte due to non-appearance of the assessee. At the same time, considering the seriousness of additions arising out of assessment proceedings, and keeping in view the principles of natural justice, we are of the considered opinion that one final opportunity should be granted to the assessee to substantiate his claims. Accordingly, in the interest of justice and fair play, we set aside the impugned order of the Ld. CIT(A) and restore the matter to his file with a directions that the assessee shall strictly comply with all notices issued by the Ld. CIT(A) and file necessary evidences in support of his claims and the Ld. CIT(A) shall adjudicate the issues afresh in accordance with law after affording reasonable opportunity of being heard. It is made clear that in case the assessee again fails to comply, the Ld. CIT(A) shall be at liberty to pass an order on merits based on material available on record.