SRI ARUMUGA ENTERPIRSE LIMITED,COIMBATORE vs. ACIT, CORP. CIRCLE-1, COIMBATORE, COIMBATORE
What did the Tribunal hold?
The Tribunal noted that the assessee was ready to prosecute the grounds of appeal and remanded the matter to the CIT(A) for fresh consideration. The assessee is permitted to file supporting evidence.
What were the facts?
The assessee, a garment manufacturer, declared a total income of ₹.33,21,030/-. The Assessing Officer made an addition of ₹.5,93,75,000/- on account of unexplained cash credit under section 68. The CIT(A) confirmed the addition ex-parte due to non-compliance by the assessee.
What were the issues?
Whether the CIT(A) was justified in confirming the Assessing Officer's order ex-parte without providing an opportunity to the assessee.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Before: Shri S.S. Viswanethra Ravi & Shri Manoj Kumar Aggarwal
O R D E R
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:
This appeal by the assessee is against the order dated 30.11.2023 passed by the NFAC [CIT(A)] for the assessment year 2017-18.
The assessee raised six grounds of appeal amongst which, the only issue emanates for consideration as to whether NFAC [CIT(A)] is justified in confirming the order of the Assessing Officer as exparte the assessee.
3. We note that the assessee is a company engaged in the business of manufacturing garments. The assessee has filed return of income declaring a total income of ₹.33,21,030/-. Under scrutiny, notice under section 143(2) of the Income Tax Act, 1961 [“Act” in short] was issued and the Assessing Officer determined the total income of the assessee at ₹.6,26,96,030/-, inter alia, making addition on account of unexplained cash credit under section 68 of the Act to the extent of ₹.5,93,75,000/- vide order dated 27.12.2019 passed under section 143(3) of the Act.
4. Having aggrieved by the said order of the Assessing Officer, the assessee preferred an appeal before the NFAC [CIT(A)], wherein, the order of the Assessing Officer was confirmed for non-compliance. Therefore, having aggrieved by the order of the NFAC [CIT(A)], the assessee preferred an appeal before us, by raising above mentioned grounds.
The ld. AR Shri R. Venkata Raman, C.A. submits that the assessee is ready to prosecute the grounds of appeal by filing relevant details and prayed to remand the matter to the file of the ld. CIT(A).
On the other hand, the ld. DR vehemently opposed.
We note that the Assessing Officer, having found cash deposits in the bank account of the assessee, sought for details of source for the said cash deposits along with cash book. The assessee contended that there was sufficient cash balance as on 08.11.2016, having examined the same, which is reproduced in page 2-3 of the assessment order, further directed the assessee to provide copy of VAT returns. On filing and verification of the same, the Assessing Officer held that the assessee failed to establish the creditworthiness and genuineness of the said cash transaction and added the same amount to the total income of the assessee.
Before the ld. CIT(A), it was contended that no opportunity was given by the Assessing Officer and the cash deposits were sales during the course of regular business. But, however, no compliance made supporting its contentions in this regard in the first appellate proceedings. Observations of the NFAC [CIT(A)] is clear from para 4 of the impugned order, which establishes that the ld. CIT(A) proceeded to confirm the order of the Assessing Officer in the absence of any evidences. Taking into consideration the submissions of the ld. AR and the issue involved under section 68 of the Act, we are of the opinion that it is a fit case for remand for fresh consideration of NFAC[CIT(A)], Delhi and accordingly, the matter is remanded to the file of the NFAC[CIT(A)], Delhi for its fresh consideration. The assessee is at liberty to file evidences, if any, in support of its contention. Thus, grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 8th May, 2024 at Chennai.
More judgments on Section 68
- ACIT Central Bilaspur, Bilaspur vs Arun Kumar Agrawal, SaktiITSSA 26/RPR/2025[2018-19]Status: Disposed21 Oct 2026AY 2018-19
- Neo Incorporation, Rajkot vs DCIT Circle- 1(2), RajkotITA 471/RJT/2026[2012-2013]Status: Disposed21 Oct 2026AY 2012-2013
- Bliss Dealtrade Private Limited, Kolkata vs Income Tax Officer - Ward 9(2) Kolkata…ITA 208/KOL/2026[2012-13]Status: Disposed21 Oct 2026AY 2012-13
- Hemal Paresh Madeka, Rajkot vs Asst.Commissioner of Income Tax…ITA 955/RJT/2026[2020-21]Status: Disposed19 Oct 2026AY 2020-21
- Ajaybhai Dineshbhai Bagdai, Near Central… vs The Income Tax Officer, Ward-1(2)(1), New…ITA 74/RJT/2026[2013-14]Status: Disposed19 Oct 2026AY 2013-14
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