JUPITOR BULLIONS,NARASANNAPETA vs. ASST.COMMISSIONER OF INCOME,CIRCLE-4(1) TAX, VISAKHAPATNAM

1. This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No.ITBA/NFAC/S/250/2023-24/1058321217(1) dated 29.11.2023, arising out of order passed u/s 144 of the Income Tax Act, 1961 (in short ‘Act’) dated 26.12.2019 for the Assessment Year (A.Y.) 2017-18.

Brief facts of the case are that the assessee had deposited the cash in old currency (SBNs) during the demonetization period. During the course of the assessment proceedings, the Assessing Officer (AO) noticed that the assessee had deposited cash of Rs.35,50,000 and 72,50,000/- totalling to Rs.1,08,00,000/- during the months of April and November, 2016 respectively. The AO worked out the average cash deposit at Rs.54,00,000/-. As the assessee had deposited over and above the average cash deposit during the month of November 2016, the AO treated the balance amount of Rs.18,50,000/- (72,50,000-54,00,000) as unexplained cash deposit u/s 69A of the Act. The AO treated the balance cash deposit of Rs.89,50,000/- as gross receipts of the assessee and estimated the business income at 8% of the receipts which worked out to Rs.7,16,000/- as the assessee did not maintain books of accounts. Thus, the AO completed the assessment and passed order u/s 144 of the Act dated 26.12.2019.

Aggrieved by the order of the AO, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) upheld the order passed by the AO and dismissed the appeal of the assessee.

Aggrieved by the order of the Ld.CIT(A), the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal :

The order passed u/s.144 of the I.T.Act are contrary to the facts of the case and provisions of law.

Per contra, the Ld.DR relied on the order of the Ld.CIT(A) and submitted that the assessee was given sufficient opportunities before the Ld.CIT(A) and hence no interference is required in the order of the Ld.CIT(A) She pleaded to uphold the order passed by the Ld.CIT(A) and dismiss the appeal of the assessee.

I have heard both the parties and perused the material placed on record. It is an undisputed fact that the assessee made cash deposits of Rs.72,50,000/- during the demonetisaton period and the cash deposit of Rs.18,50,000/- over and above the average monthly deposits of Rs.54,00,000/- was treated as unexplained cash deposit u/s 69A since the books of accounts are not maintained. The petition seeking adjournment was rejected since the assessee pleaded for an opportunity of being heard before the Ld.CIT(A) to substantiate his case with credible material evidence. In view of the foregoing facts and circumstances of the case and keeping in view the principles of natural justice, I am inclined to remit the matter back to the file of the Ld.CIT(A) with a direction to afford another opportunity of being heard to the assessee. The assessee is Jupitor Bullions,Narsannapeta also directed to adhere to the notices issued and served by the revenue authorities and produce supporting documentary evidence to substantiate it’s claim. Accordingly, the grounds raised by the assessee are allowed for statistical purpose.

In the result, appeal of the assessee is allowed for statistical purpose.