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Facts
The assessee filed an income tax return which was selected for scrutiny due to cash deposits during demonetization. The Assessing Officer made a best judgment assessment, adding Rs. 52,50,000/- as unexplained cash deposits. The assessee's first appeal was dismissed by the CIT(Appeals).
Held
The Tribunal noted that the assessee claimed the deposits were from farmers for cold storage receipts. However, the assessee failed to provide sufficient details and confirmations to the lower authorities. The Tribunal decided to restore the matter to the Assessing Officer for fresh verification of evidence.
Key Issues
Whether the addition made by the Assessing Officer on account of unexplained cash deposits is justified, and whether the CIT(A) erred in dismissing the appeal without considering the evidence presented by the assessee.
Sections Cited
144, 69A, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AGRA BENCH, AGRA
Before: SHRI M. BALAGANESH & SHRI SUNIL KUMAR SINGH
ORDER PER : SUNIL KUMAR SINGH, JUDICIAL MEMBER:
This appeal has been preferred by assessee against the impugned order dated 04.02.2025 passed in Appeal No. CIT(Appeal) 2, Agra/10761/2019-20 by the Ld. ADDL/JCIT(A)-10, Mumbai u/s. 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2017-18.
Brief facts state that the assessee filed return of income on 27.03.2018, declaring total income of Rs.12,01,106/-, which was revised on 18.07.2018 on the same income. Case was selected for scrutiny under CASS due to cash deposit during the demonetization period. The assessee did not respond to the statutory notices, hence, the ld. Assessing Officer made best judgment assessment u/s. 144 of the Act and made addition of Rs.52,50,000/- on account of unexplained cash deposits u/s. 69A of the Act.
Aggrieved assessee filed an appeal before learned CIT(Appeals), who, after considering assessee’s submissions, dismissed assessee’s first appeal.
Appellant assessee has filed this second appeal on the ground, in addition to others, that the impugned order is bad in law as has been passed by ignoring the deposit in the assessee’s bank account, which was made mostly out of the receipts from the farmers, who used the facility of appellant’s cold storage.
Perused the records and heard learned representative for the assessee and learned DR for the revenue.
Learned AR has drawn the attention of the Bench towards paper book, wherein a list of affidavits of farmers along with Aadhaar copies has been filed at page 1 to 56 in support of said deposits.
Learned DR, on the other hand, supported the impugned order.
We notice that learned Assessing Officer has made the best judgment assessment u/s. 144 of the Act and added Rs.52,50,000/- as unexplained cash deposited during the demonetization period. It further transpires from the perusal of the impugned order passed by the Ld. CIT(Appeals) that after considering the submissions of the appellant assessee, the first appellate 2 | P a g e authority has dismissed assessee’s appeal on the ground that the appellant did neither furnish the dates of details of cash received nor any confirmation from the concerned parties. In the totality of facts and circumstances and in the interest of justice, we deem it just and proper to restore the matter back to the file of learned Assessing Officer, before whom, the assessee may file submissions afresh along with evidences with respect to the details of cash receipts and confirmation of such receipts from the concerned parties to substantiate the impugned cash deposit. Learned Assessing Officer, after due verification of the evidence produced before him, shall pass order afresh in accordance with law. Needless to say that learned Assessing Officer shall ensure the observance of the principles of natural justice. The appeal is liable to be allowed accordingly.
In the result, appeal is allowed for statistical purposes.
Order pronounced in the open court on 29.08.2025.