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Income Tax Appellate Tribunal, DELHI BENCH ‘G’: NEW DELHI
(Assessment Year: 2017-18) Income Tax Officer, vs. Sudha Sishodia, Ghaziabad. D-344, Shastri Nagar, Ghaziabad- 201 200 (Uttar Pradesh). (PAN : AGQPS7536A) (APPELLANT) (RESPONDENT) ASSESSEE BY : Dr. Kapil Goel, Advocate REVENUE BY : Shri Manish Gupta, Sr. DR Date of Hearing : 15.07.2025 Date of Order : 26.09.2025 O R D E R
PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER :
The Revenue has filed appeal against the order of the Learned Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi [“Ld. CIT(A)”, for short] dated 08.03.2024 for the Assessment Year 2017-18.
Brief facts of the case are, the assessee filed its return of income on 6.11.2017 declaring total income of Rs.11,56,650/-. The case was selected for scrutiny under CASS, the statutory notices u/s 143(2) of the Income-tax Act, 1961 (for short ‘the Act’) were issued on 27.09.2018 AO, the same was served on the assessee. Subsequently several other notices were also issued to the assessee. Since there was no compliance, the assessment u/s 143(3) was completed on the basis that the assessee had made cash deposits during demonetization period to the extent of Rs.2,41,65,490/-, which the assessee failed to substantiate the sources of the cash deposits even though several opportunities were extended.
Aggrieved, the assessee filed an appeal before NFAC, Delhi. The assessee filed a detailed notes and additional evidences to substantiate the sources of cash deposit during the year, particularly during the demonetization period. The same is reproduced in the appellate order at pages 3 to 17. Ld CIT(A) remanded the matter to the AO to verify the additional evidences/documents submitted by the assessee, which were not submitted during the assessment proceedings. Ld CIT(A) also observed that the assessee is in the business of running petrol pump dealer. However, the AO has not submitted the remand report, after several reminders, the JAO submitted a report with the submission that the details were not submitted during the assessment proceedings, the additional evidences should be rejected. Further, reminders were sent to the JAO to submit the remand report on the merits of the issue. However, JAO has not submitted any remand report even after several reminders, Ld CIT(A) presumed that JAO has no adverse inference against the merits of the material submitted by the assessee. Therefore, he proceeded to adjudicate the issue on the basis of ground no.10 raised by the assessee. He found that the material submitted by the assessee are credible and satisfied with the documents submitted, he allowed the ground on merits without going into the other issues raised by the assessee, like the non-serving of the statutory notices in the right email id of the assessee.
Aggrieved with the above order, the revenue in appeal before us raising following grounds of appeal:
1. That on the facts and circumstances of the case, the CIT (A) erred in his order passed u/s 250 of the I.T. Act, 1961 dated 08.03.2024 in deleting the addition of Rs.2,41,65,490/- which was treated as unexplained income from undisclosed sources on cash deposits during demonetization period i.e. from 09.11.2016 to 31.12.2016.
2. That on the facts and circumstances of the case, the CIT (A) erred in examining the reply of the assessee without getting cross verification from the end of the Assessing Officer.
3. That on the facts and circumstances of the case, the CIT (A) erred in examining the pattern of cash deposits during demonetization period i.e. from 09.11.2016 to 31.12.2016 and before the demonetization period.”
5. At the time of hearing, Ld DR brought to our notice the relevant facts on record, he objected to the relief granted to the assessee without granting cross verification from the end of the AO, failed to examine the pattern of cash deposits particularly during the demonetization period and before the demonetization period. He prayed that the order passed by the Ld CIT(A) deserves to be quashed and if need to be remitted to the file of AO to redo the assessment afresh.
6. On the other hand, Ld AR raised the issue of non-serving of statutory notice u/s 143(2) of the Act, he submitted that the AO has sent the mail to the wrong email id and there is no proof with the department of serving the notice to the assessee within the statutory limitation period. He submitted that the assessee had already submitted the relevant proof of cash deposits before the appellate proceedings and the Ld CIT(A) had appreciated the evidence submitted before him. Further, he submitted that the AO was given several opportunities in the remand proceedings, all the relevant documents were submitted before the AO, however, AO chose to ignore the several reminders issued by the Ld CIT(A). Therefore, he objected to the remanding the matter to the AO again.
7. Considered the rival submissions and material placed on record. We observe that the AO had sent the notice u/s 143(2) to the assessee in the electronic mode and presumed that the same was served on the assessee. He has not verified why the assessee has not represented the case, even though several notices were issued to the assessee on the same mode of communication. He sustained the addition based on the information available with him. However, the assessee had submitted the additional evidences before Ld CIT(A) and Ld CIT(A) had remanded the matter to JAO, also gave several opportunities to the JAO to submit the remand report, he failed to respond to the several notices. There is no case for the Revenue to once again to raise the same issue, wherein the assessee had already submitted the relevant proof of cash deposit and also proved the genuineness of the cash deposit.
8. Considering the facts on record that the assessee is in the business of running a petrol pump and there is regular cash collection and deposits were made out of the above cash collection. It is also fact that during demonetization period, the government at the point of time, allowed the use of the demonetized currencies in the petrol pumps and most of the citizens utilised the opportunities to buy the petrol/diesel during that period, there is a reason to increase the sales during that period. Considering the overall facts on record, we do not see any reason to disturb the findings of Ld CIT(A), who had appreciated the relevant material on record. Therefore, we are inclined to dismiss the grounds raised by the revenue.
9. In the result, appeal filed by the Revenue is dismissed. Order pronounced in the open court on this 26th day of September, 2025.