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Facts
The assessee, a fruit trader, filed an appeal after a significant delay of 234 days, which was initially dismissed by the CIT(A) without considering the merits. The Assessing Officer had estimated the assessee's income at 8% of the turnover and made an addition of Rs. 3,00,000/- for demonetized currency received.
Held
The Tribunal condoned the delay in filing the appeal, noting that the assessee provided medical certificates as support. The addition of Rs. 3,00,000/- on account of demonetized currency was deleted as it was a small amount relative to the turnover and considering government circulars.
Key Issues
Whether the delay in filing the appeal before the CIT(A) should be condoned, and whether the addition on account of demonetized currency is justified.
Sections Cited
IT Act
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Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK
Before: SHRI GEORGE MATHAN & SHRI MADHUSUDAN SAWDIA
(�नधा�रण वष� / Assessment Year : 2017-2018) Jhadeswar Mandal Vs ITO, Bhadrak Ward, Bhadrak C/O:- Mandal, Fruits, At/P.O/P.S:- Kachery Bazar, Dist:- Bhadrak, 756100, Odisha PAN No. : BGUPM 0558 C (अपीलाथ� /Appellant) .. (��यथ� / Respondent) �नधा�रती क� ओर से /Assessee by : Shri P.K.Mishra and Shri Himansu Jena, Advs राज�व क� ओर से /Revenue by : Shri Vijaya Singh, Sr DR सुनवाई क� तार�ख / Date of Hearing : 18/02/2026 घोषणा क� तार�ख/Date : 18/02/2026 of Pronouncement आदेश / O R D E R Per Bench :
This is an appeal filed by the assessee against the order passed by ld.CIT(A), National Faceless Appeal Centre (NFAC), Delhi dated 28/02/2025 in Appeal No. NFAC/2016-17/10267337 for the assessment year 2017- 2018.
Shri P.K.Mishra and Shri Himansu Jena, ld ARs appeared for the assessee and Shri Vijaya Singh, ld Sr DR appeared for the revenue.
The appeal is time barred by 234 days. The assessee has filed condonation petition alongwith affidavit supported by medical certificates from the doctor in support of the delay in filing the appeal. The above submission of the assessee has not found to be false. Hence, we condone the delay of 234 days in filing the appeal and admit for adjudication.
It was submitted by ld AR that the assessee is a trader of fruits. It was the submission that in the course of assessment, the Assessing Officer estimated the income of the assessee. The Assessing Officer had accepted the turnover of the assessee at Rs.6,50,84,842/- and estimated the income at 8%. It was the submission that the assessee normally earned the income of 1.5 to 2%. It was the submission that the Assessing Officer further made an addition of Rs.3,00,000/- representing the demonetization currency received against the sale proceeds and deposited in the bank account. It was the submission that on appeal, ld CIT(A) dismissed the appeal of the assessee on account of delay in filing the appeal before him. It was the submission that the ld CIT(A) has dismissed the appeal of the assessee without considering the issue on merits on account of delay of 119 days in filing of appeal. It was prayer that the delay in filing the appeal before the ld CIT(A) may be condoned and income of the assessee restored to the returned income.
In reply, ld Sr DR vehemently relied on the order of the lower authorities and prayed to upheld the same.
We have considered the rival submissions. It is noticed that the ld CIT (A) has dismissed the appeal of the assessee without condoning the delay considering the submission of the assessee as not plausible and did not consider the facts on merits. Considering the submission of the assessee as pointed out in Form No.35, we condone the delay in filing the appeal before the ld CIT(A).
A perusal of the facts in the present case clearly shows that it is an accepted fact that the assessee is a dealer of fruits and no variation in the turnover has been found by the Assessing Officer. The Assessing Officer has estimated the profit at 8% of its turnover. The assessee is a dealer in fruits and duly earned such income. Earlier years, the details which have been submitted before the Assessing Officer, also shows that the assessee is earning profit margin at 1.4 to 1.54%. This being so, in the interest of justice, the Assessing Officer is directed to estimate the profit at 4% of the turnover. In regard to addition of Rs.3 lakhs being demonitised currency deposited in the bank account, it is noticed that the assessee is a dealer of perishable commodity and once the product is sold, the assessee is not in a position to determine the nature of the currency that he receives. Admittedly, the assessee has shown Rs.3 lakhs of demonitisation currency on a turnover of Rs.6,50,84,842/-. Compared to the total turnover, this is a very small amount. Even the Government has issued circular that upto Rs.2.50 lakhs cash deposited in the bank as demonitised currency would not be questioned. Therefore, the addition of Rs.3,00,000/- being on account of the demonitised currency stands deleted. With these directions, the issues in this appeal are restored to the file of the AO.
In the result, appeal of the assessee stands partly allowed.
Order dictated and pronounced in the open court on 18/02/2026.