NAHAR FINANCE & LEASING LTD.,CHENNAI vs. ITO, CORPORATE WARD-4(2),, CHENNAI

(िनधा�रणवष� / Assessment Year: 2017-2018) M/s. Nahar Finance & Leasing Ltd, Vs. The Income Tax Officer, Shop No.311, 19-20, Ram Lakhan Chamber, Corporate Ward 4(2) 3rd floor, General Muthiah Mudali Street, Chennai. Chennai 600 079. [PAN: AAACN 3181G] (अपीलाथ�/Appellant ) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : None ��यथ� क� ओर से /Respondent by : Shri. V. Justin, IRS, JCIT. सुनवाई क� तार�ख/Date of Hearing : 25.11.2024 घोषणा क� तार�ख /Date of Pronouncement : 25.11.2024 आदेश / O R D E R PER MANU KUMAR GIRI (Judicial Member)

This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in order No.ITBA/NFAC/S/250/2024-25/1064625546 (1) dated 03.05.2024. The assessment was framed by the Income Tax Officer, Corporate Ward 4(2), Chennai for the assessment year 2017-18 u/s.143(3) r.w.s 147 of the Income Tax Act, 1961 (hereinafter the ‘Act’), vide order dated 21.11.2019.

2. Brief facts of the case are that the assessee is a non banking financial company engaged in the business of money lending and finance. The assessee filed its return of income on 19.01.2018 declaring total income of Rs.57,570/-. As per the information available with the department, it was noted that the assessee had deposited cash amounting to Rs.29,71,000/- in various bank accounts during the demonetization period F.Y. 2016-17 relevant to A.Y. 2017- 18 which exceeds the total turnover of Rs.14,65,886/- shown in the ITR by the assessee. Hence, the AO reopened the case of the assessee by issue of notice u/s.148 of the Act after obtaining approval from the competent authority. In response, the assessee filed return of income on 11.04.2019 showing gross receipts at Rs.14,65,886/- and declared net profit of Rs.57,570/-. The AO noted that the assessee filed its original return only after demonetization notices issued to the assessee. Thereafter, the AO issued notices u/s. 133(6) of the Act to Indian Bank, Sowcarpet Branch and Indian Overseas Bank, Wall Tax Road Branch calling for copies of the bank statements for the relevant year. In response, the banks submitted the copies of bank statements. It was shown that the assessee had deposited Rs.14,56,000/- in the Indian Bank and Rs.15,15,000/- in the Indian Overseas Bank during the demonetization period. The assessee was asked to produce ledger extract of the cash transactions made as well as cash book for the F.Y. 2016-17. However, the assessee has failed to produce any details / documentary evidences / sources of cash deposits. Thereafter, the AO issued show cause notice dated 10.10.2019, however, there was no response from the assessee. Hence, the AO made an addition of Rs.29,71,000/- (Rs.14,56,000+ Rs.15,15,000) u/s.69A of the Act to the total income of the assessee. Aggrieved with the said additions/disallowances, the assessee preferred an appeal before the CIT(A). The CIT(A) vide order dated 31.03.2022 dismissed the appeal of the assessee since the assessee has not submitted any written submissions in support of its grounds of appeal and has only submitted copy of assessment order, grounds of appeal and statement of facts along with Form No.35. Aggrieved, assessee preferred an appeal before the Tribunal. The Tribunal vide order dated 30.08.2022 had set aside the order back to the file of the CIT(A) for fresh adjudication after due opportunity of being heard to the assessee. In compliance to the order of the Tribunal, the appeal has been uploaded in the ITBAvideappealNo.NFAC/2016-17/10197982 dated 14/09/2022. The case was fixed for hearing through ITBA on 19.10.2023, 30.10.2023,30.11.2023, 26.12.2023,13.03.2024 and 25.03.2024. Vide hearing notice, the assessee was asked to file Copy of audit report, balance sheet and ITR, PAN data, bank statements, cash flow statements etc. However, the ld. CIT(A) noted that the assessee has claimed that the source of impugned cash deposits is also partly explained out of cash withdrawals of Rs.18 lakhs from Indian Overseas Bank between 03.09.2016 to 26.10.2016. However, no cash flow details have been submitted and even the bank statements of later dates have been submitted 01.04.2020 to 31.03.2021, 01.04.2018 to 07.12.2020 but surprisingly the bank statement of the relevant F.Y. i.e. 01.04.2016 to 31.03.2017 has not been enclosed by the assessee, even though it was clearly called for from the assessee vide NFAC hearing notice dated 19.12.2023. As per the ld. CIT(A) assessee has not discharged its onus of proving the genuineness of its claim despite sufficient