Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, HYDERABAD BENCHES “SMC”, HYDERABAD
Before: SHRI LALIET KUMAR
O R D E R PER LALIET KUMAR, J.M. The appeal of the assessee for A.Y. 2017-18 arises from the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dt.13.12.2023 invoking proceedings under section 143(3) of the Income Tax Act, 1961 (in short, “the Act”).
The appeal filed by the assessee is barred by limitation by 33 days. It has moved a condonation petition explaining reasons thereof. I have heard both the parties on this preliminary issue. Having regard to the reasons given in the petition, I condone the delay and admit the appeal for hearing.
2.1 The grounds raised by the assessee read as under :
“ 1.. The Ld. CIT(A) ought to have appreciated that the order of the assessing officer is erroneous both in law and on facts.
2. The Ld. CIT(A) has erred in alleging that the cash deposits are Unexplained money u/s 69A of the Income Tax Act, 1961 (Hereinafter referred as "ACT"). 3- The Assessee being an Educational Society with about 16 Schools (or) Educational Institutions being run under the society and has duly recorded the cash receipts and the cash deposits in its Books of Accounts. Thus, the action of the Ld. CIT(A) by taxing the cash deposits u/s 69A r.w.s 115BBE is bad in law.
4. The Ld. CIT(A) has erred in not considering that no addition can be made u/s 69A of the Act, where the cash deposits are already recorded in Books of Accounts of the Assessee.
5. The Ld. CIT(A) has erred in confirming the action of Ld. AO, without considering that the Assessee is Educational Society and has duly filed its Return of Income and has duly incorporated the cash receipts on account of student fee received during the relevant Assessment year under consideration 6. The Alleged cash deposits are nothing but cash received from student fees Account and the same is deposited in order to meet the objectives of the Society. The said fact has been brushed away by the Ld. CIT(A).
7. The ld.CIT(A) has erred in not considering that the assessee is eligible to claim exemption u/s 10(23C) of the Income Tax Act, 1961. Thus, Once the Assessee is eligible to claim exemption U/s 10(23c)(vi), any such disallowances or additions shall lead to increase in the claim made by the assessee and thereby no such loss arises to the Revenue.
8. The Ld. CIT(A) has erred in confirming the action of the Ld- AO wherein provisions of section 69A r.w.s 115BBE of the Act are erroneously a lied in the resent case of the Assessee.
The brief facts of the case are that the assessee e-filed its return of Income for the A.Y. 2017-18 on 12.01.2018, declaring total income of Rs. NIL. Subsequently, the case was selected for scrutiny under CASS and notice u/s 143(2) of the IT Act was issued and duly served on the assessee. The notice u/s 142(1) of the I.T. Act was issued electronically calling for further details in ITBA Portal. Assessee claimed exemption u/s 10(23) (vi) of the I. T. Act. The case was selected for scrutiny on the issue of ‘Cash deposit during demonetization period”. From the bank account statement received, there was a cash deposit of Rs.36,69,500/- in Bank Account bearing No 915010002707114, L B Nagar Branch, Axis Bank, Hyderabad. Hence, a notices u/s 142(1) was issued on 5/9/2018 and on 15/11/2019. As there was no response from the assessee, show cause notices dated 4/12/2019 and 12.12.2019 were issued to explain sources for cash deposited in the bank accounts.
3.1. As there were no responses for the said show cause notices, on 24.12.2019, the Managing Trustee of the Society was summoned, who in turn sought some more time to explain sources for cash deposits, but failed to explain. Though, assessee society was running educational institutions and receipt of fees were being reflected in the society returns even earlier and subsequent years also, since assessee failed to explain sources for cash of Rs. Rs.36,69,500/- deposited during demonetization period, same was treated as unexplained cash deposits u/s 69A of the I T Act., and brought to tax. Accordingly, the Assessing Officer completed the assessment u/s 143(3) of the Act and passed assessment order on 31.12.2019.
Feeling aggrieved with the order of Assessing Officer assessee filed an appeal before the ld.CIT(A), NFAC, Delhi, who dismissed the appeal of assessee due to non-representation of the assessee even after grant of several opportunities to explain the sources for the cash deposits during the demonetization period.
Before me, ld.AR submitted that the assessee is an educational institution and is receiving the fee from the students every month and the fee received by the assessee in previous months i.e., October, 2016 and September, 2016 are in the same proportion as deposited in the month of November, 2016. It is the submission of the assessee that if given a chance, the assessee will be able to explain the amount of cash deposited during the demonetization period and sources thereof. It was also the contention of the assessee that the Assessing Officer and CIT-DR is has not verified whether the cash deposited during the demonetization period was in the Specified Bank Notes or not. The ld. AR further submitted that the case of the assessee may be remanded with some costs to meet the ends of justice and to balance the equity.
Per contra, the ld.DR has submitted that the assessee was non-cooperative and had no indulgence at the end of the Tribunal. Further, the ld. DR has supported the orders of the lower authorities.
I have heard the rival contentions of both the parties and perused the material available on record and also the orders passed by the lower authorities. On perusal of the impugned order passed by ld.CIT(A), I found that ld.CIT(A) passed exparte order confirming the action of the Assessing Officer. Undoubtedly, the assessee was non-cooperative and has not participated in the proceedings. Before the Assessing Officer as well as the ld.CIT(A), the assessee has not furnished the documents to prove its case even after granting several opportunities. Before me, the assessee had filed paper book without any application for admission of additional documents, therefore, it is difficult to examine these documents at this stage. However, considering the assessee being an educational institution, doing the social and charitable activities and to meet the ends of justice, I deem it appropriate to remand back the matter to the file of Assessing Officer with a direction to the assessee to produce all the documents and evidences before the Assessing Officer subject to payment of costs of Rs.5,000/- (Rupees Five Thousand only) to be deposited with the Child Welfare Board, Hyderabad which shall be payable within one month or from the date of receipt of this order or whichever is earlier.
Accordingly, the appeal of the assessee is remanded back to the file of Assessing Officer with a direction to decide the issue after considering the documents available on record and affording the opportunities of hearing to the assessee in accordance with law. The assessee shall be at liberty to file documents, if any, as required for proving its case and the Assessing Officer shall consider the evidences, if any, filed by the assessee. Needless to say the Assessing Officer shall examine those documents / evidence filed by the assessee and also the other documents available on record. After considering the documents filed by the assessee and the submissions made by the assessee, the Assessing Officer shall pass a detailed speaking order dealing with the contentions of the assessee. I have not adjudicated the other grounds on merits as I am setting aside the orders passed by the lower authorities to the file of Assessing Officer for fresh adjudication. Thus, the grounds of the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is treated as allowed for statistical purposes.
Order pronounced in the Open Court on 15th April, 2024.