ARULKUMAR KULANDAIVEL,NAMAKKAL V. INCOME TAX OFFICER WARD 2 NAMAKKAL, NAMAKKAL

ITA 1356/CHNY/2025

AI Insights

The case involves Arulkumar Kulandaivel, an individual engaged in the transport business, who appealed against the order of the Commissioner of Income Tax (Appeals), Delhi, for the Assessment Year 2016-17. The primary issue was the estimation of income by the Assessing Officer (A.O) at 8% of excess bank credits due to lack of documentary evidence, which was later reduced to 4% by the CIT(A). The Tribunal noted that the CIT(A) did not consider a revised remand report where the A.O accepted the assessee's explanations. The Tribunal found this oversight significant and remitted the case back to the CIT(A) for re-evaluation based on the revised report.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711785 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2016-2017
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOUTHAMI MANIVASAGAM
• Assessee Lawyers: KARUPPANNA GOUNDAR
• Keywords: Principle of natural justice
• Section: 143(3)

Judgement Text

"आयकर अपीलीय अिधकरण, ‘बी’ \u0011ा यपीठ, चे\u0016ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: CHENNAI \u0019ी मनु क ुमा र िग र, \u0011ा ियक सद! एवं \u0019ी जगदीश, लेखा सद! क े सम( BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.1356/Chny/2025 िनधा :रण वष: /Assessment Year: 2016-17 Arulkumar Kulandaivel, Old No.4/66, New No.4/101, Proprietor Poorviga Road Carriers, Nadu Veethi, Nallipalayam, Namakkal – 637 003. [PAN: ALJPA 2944F] Vs. The Income Tax Officer, Ward-2, Namakkal. (अपीलाथ\u0007/Appellant) (\b यथ\u0007/Respondent) अपीलाथG की ओर से/ Appellant by : Shri Karuppanna Goundar Marimuthu, ITP IJथG की ओर से /Respondent by : Ms. Gouthami Manivasagam, JCIT सुनवाई की तारीख/Date of Hearing : 17.07.2025 घोषणा की तारीख /Date of Pronouncement : 24.07.2025 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee for Assessment Year (AY) 2016-17 arises out of the order of Learned Commissioner of Income Tax (NFAC), Delhi [hereinafter “CIT(A)”] dated 20.03.2025. Printed from counselvise.com ITA No.1356/Chny/2025 Arulkumar Kulandaivel :- 2 -: 2. The assessee is an individual engaged in the transport business. The assessee has filed his return of income declaring total income of Rs. 4,84,840/-. The A.O, in the assessment order passed u/s. 143(3) of the Act, estimated income at 8% of excess credits amounting to Rs.3,96,74,754/- credited in the bank account, as the assessee failed to furnish any documentary evidence. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). On appeal, the Ld. CIT(A) called for a remand report from the A.O. In the remand proceedings, the A.O stated that the assessee had not made any submissions despite being given several opportunities, and therefore, reiterated the addition made in the assessment order. Consequently, the Ld. CIT(A) estimated the income at 4% of the total credits determined by the A.O. 3. The Ld. Authorized Representative (A.R) has contended that the Ld. CIT(A) decided the case based on the initial remand report submitted on 30.09.2024, in which the A.O stated that the assessee had failed to submit any explanation despite sufficient opportunity and recommended rejection of the assessee’s claim. However, the A.O subsequently on the basis of details submitted by the assessee had Printed from counselvise.com ITA No.1356/Chny/2025 Arulkumar Kulandaivel :- 3 -: sent revised remand report dated 03.03.2025 accepting assessee’s explanation and uploaded to the ITBA portal, recommending acceptance of the assessee’s explanation, but the Ld. CIT(A) passed the order without considering the revised remand report. 4. The Ld. Departmental Representative relied on the orders of the authorities below. 5. We have heard the rival submissions and perused the materials available on record. The A.O made an addition of Rs. 31,73,980/- by applying 8% on the excess bank credits of Rs. 3,96,74,754/-, citing lack of documentary evidence. The Ld. CIT(A) reduced the estimate to 4% of unexplained receipts of Rs. 2,51,36,436/- as the assessee did not make submissions during the initial remand proceedings. However, the A.O subsequently submitted a revised remand report, which the Ld. CIT(A) did not consider. In our considered opinion, and in the interest of natural justice, the matter is remitted back to the file of the Ld CIT(A) with a direction to decide the appeal after duly considering the revised remand report. We also direct the assessee to appear before the Ld. CIT(A) on the date of hearing without fail and to furnish Printed from counselvise.com ITA No.1356/Chny/2025 Arulkumar Kulandaivel :- 4 -: all necessary details. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 24th day of July, 2025 at Chennai. Sd/- Sd/- (मनु क ुमार िग र) (Manu Kumar Giri) \u0011ाियक सद! / Judicial Member (जगदीश) (Jagadish) लेखा लेखा लेखा लेखा सद\u0011य सद\u0011य सद\u0011य सद\u0011य /Accountant Member चे\u0013नई/Chennai, \u0016दनांक/Dated: 24th July, 2025. EDN/- आदेश क\u0019 \bितिल प अ े षत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b थ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Salem 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF Printed from counselvise.com "