M/S. UNIFIED SOUHARDA CREDIT COOPERATIVE LIMITED ,BENGALURU vs. INCOME TAX OFFICER, WARD-5(2)(5) , BANGALORE

In the instant case, the Assessee being a Co-operative society had shown its income as Rs.’Nil’ by filing its return of income on dated 23.10.2017, which was subsequently selected for scrutiny and ultimately resulted into passing of Assessment order dated 10.12.2019 u/s. 143(3) of the Act, whereby the additions of Rs.19,35,798/- and Rs.4,10,03,700/- respectively on account of dis-allowance of deduction claimed u/s 80P(2)(a)(i) of the Act and un-explained cash credits u/s 68 of the Act, have been made.

The Assessee being aggrieved, by filing first appeal challenged the said additions/disallowance before the ld. Commissioner, who though by partly allowing the appeal of the Assessee, allowed the claim on deduction u/s 80P of the Act to the Assessee, however, sustained the addition to the tune of Rs.4,10,03,700/- as un- explained cash credits u/s 68 of the Act. The Assessee therefore, being aggrieved against the affirmation of the addition made u/s 68 of the Act by the ld. Commissioner, is in appeal before us. The Assessee before us claimed that by filling Annexure-2 it had explained the source of cash deposits viz-a-viz details all the persons from whom the amounts were received. The said documents/details same were also filed online before the AO, therefore there was no need to file any application for admission of additional evidence before the ld. Commissioner. However, the ld. Commissioner without paying any heed to the request and the details filed by the Assessee, decided the issue qua addition u/s 68 of the Act against the Assessee.

On the contrary, the Ld. Departmental Representative refuted the claim of the Assessee.

Having heard the parties and given thoughtful consideration to the peculiar facts and circumstances of the case, we observe that the ld. Commissioner though passed the impugned order on merits and made the addition u/s 68 of the Act and also taken into consideration the rectification order dated 15.6.2020 passed by the AO, whereby the amount of Rs.1,61,70,000/- was reduced from the amount of total addition of Rs.4,10,03,700/- after considering the rectification application filed by the Assessee and in effect affirmed the addition to the tune of Rs.2,48,33,700/- only, but the Ld. Commissioner did not consider the details furnished by the Assessee, in its true spirit and right perspective, hence considering the peculiar facts and circumstances, we are inclined to remand the instant case to the file of the ld. Commissioner for decision afresh, on the addition made by AO u/s. 68 of the Act, as affirmed by the ld. Commissioner to the tune of Rs.2,48,33,700/- only.

In the result, the appeal filed by the Assessee stands allowed for statistical purposes.