SHRI DHARMESH BHAILAL VAGHELA,RAJKOT vs. THE INCOME TAX OFFICER-WARD-3 (1)(2),, RAJKOT

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ITA 169/RJT/2021Status: DisposedITAT Rajkot17 February 2023AY 2012-13Bench: Shri Waseem Ahmed (Accountant Member), Shri Siddhartha Nautiyal (Judicial Member)4 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal. In the interest of justice, the matter was restored to the CIT(A) for a fresh hearing on merits, allowing the assessee an opportunity to produce supporting evidence for the cash deposits.

What were the facts?

The assessee made cash deposits of Rs. 17,06,665/- in bank accounts, claiming they were from sale of goods. The Assessing Officer added this amount as unexplained income for lack of evidence. The CIT(A) dismissed the appeal, also finding no supporting material.

What were the issues?

Whether the CIT(A) erred by not providing adequate opportunity to the assessee and confirming the addition of unexplained cash deposits without considering the merits.

Which sections of the Income-tax Act were involved?

Section 148,Section 274,Section 271(1)(c),Section 234A,Section 234B,Section 234C,Section 234D

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT

Before: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Kalpesh Doshi, A.R
For Respondent: Shri B.D. Gupta, Sr. D.R

आदेश/ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:-

1.

This assessee’s appeal for A.Y. 2012-13, arises from order of National Faceless Appeal Centre (NFAC), Delhi dated 28-07-2021, in proceedings under section 250 of the Income Tax Act, 1961; in short “the Act”.

Page No 2 Shri Dharmesh Bhailal Vaghela vs. ITO

2.

The assessee has taken the following grounds of appeal:-

Tax effect relating to each Ground of Grounds of appeal appeal 1 That, the ld. CIT(A) has passed the order without affording proper opportunity of being --- heard. 2 That, the Ld. CIT[A) has wrongly confirmed reopened assessment u/s. 148 of --- the IT Act, 1961. The Ld. C1T(A) has passed the appeal order without considering the merit of the case.

3 That, the Ld. CIT[A) has wrongly confirmed addition of Rs. 17,06,665/-on --- account of unexplained cash deposits.

4 That, the Ld. CIT[A) has wrongly --- confirmed initiation of penalty proceedings u/s 274 r.w.s. 271[l)[c) of the IT. Act, 1961. 5 That, the Ld. CIT[A) has wrongly --- confirmed levy of interest u/s 234A, 234B, 234C and 234D of the Income Tax Act, 1961.

6 That, the findings of the Ld. AO and Ld. --- CIT(A) are not justified and are bad- in-law.

7 The appellant craves to add, amend, alter or --- delete any of the above grounds of appeals.

Total tax effect (see note below) 10,31,320/-

3.

At the outset, we observe that there is delay of 96 days in filing of the present appeal by the assessee. The counsel for the assessee submitted that appeal was filed during the Covid period and accordingly the delay may kindly be condoned.

Page No 3 Shri Dharmesh Bhailal Vaghela vs. ITO 3.1 In view of the explanation of the assessee, in the interest of justice, we are hereby condoning the delay in filing the appeal by the assessee.

4.

The facts of the case are that the assessee is engaged in the business of purchase and sale of shares through recognized stock exchange. During the year under consideration, the assessee had made cash deposits of Rs. 17,06,605/- in various bank accounts. During the assessment proceedings, the assessee submitted that the cash deposits were made out of sale of goods. However, the Assessing Officer rejected the contention of the assessee on the ground that he has not furnished any material in respect of the cash sales. The ld. Assessing Officer, accordingly made an addition of the aforesaid amount of Rs. 17,06,665/- as unexplained income of the assessee.

5.

The assessee filed appeal before the ld. CIT(A). In appeal, the ld. CIT(A) dismissed the assessee’s appeal on the ground that the assessee even during appellate proceedings has not submitted any material in support of the said cash deposits in the bank accounts. The assessee has not filed any evidence to prove that the said cash deposits were made out of cash sales. Accordingly, the appeal of the assessee was dismissed.

6.

Before us, the counsel for the assessee submitted that the order passed by ld. CIT(A) was ex-parte and the assessee did not get adequate opportunity to present his case on merit. The counsel for the assessee submitted that all these deposits have been made out of cash sales and if given an opportunity, he shall suitably demonstrate the source of such cash deposits in the bank account. Accordingly, looking into the facts of the Page No 4 Shri Dharmesh Bhailal Vaghela vs. ITO instant case, in the interest of justice, we are hereby restoring the file to ld. CIT(A) for hearing afresh on merit after giving due opportunity to the assessee to produce the requisite supporting evidences on record to substantiate the source of such cash deposits. In the result, the matter is being set aside to the ld. CIT(A) with the above directions.

7.

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

Order pronounced in the open court on 17-02-2023

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