BATH AFFAIR,DELHI V. ITO WARD 49(2), DELHI

ITA 916/DEL/2024

AI Insights

The case involves Bath Affair, the appellant, contesting an order confirming an addition of Rs. 1,53,03,000 made by the Assessing Officer under section 68 of the Income Tax Act, citing unexplained cash deposits. The appellant argued that the show cause notice was vague and that the addition under section 69A was inappropriate as the transactions were recorded in their books. The Tribunal found merit in the appellant's arguments and directed a limited verification by the Assessing Officer.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 471792 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH TRIPATHI
• Assessee Lawyers: ARUN KISHORE; ANIL KISHORE
• Keywords: Set aside; Opportunity of being heard
• Section: 250; 153A; 68; 69; 69A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘A’: NEW DELHI) BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER ITA No:-916/Del/2024 (Assessment Year- 2017-18) v Bath Affair, WZ-6/1, Mansarover Garden, West Delhi, Delhi 110015 Vs. ITO, Ward 49(2), Civic Centre, Minto Road, Delhi 110002 PAN No:AAEFB3144N APPELLANT RESPONDENT Assesseeby : Shri Arun Kishore, CA & Shri Anil Kishore, CA Revenue by : Shri Ashish Tripathi, Sr. DR Date of Hearing : 12.03.2025 Date of Pronouncement : 21.03.2025 ORDER PER AMITABH SHUKLA, AM: The Assessee is contesting order u/s 250 dated 29.12.2023, passed by NFaC confirming addition of Rs. 1,53,03,000/- made by the Ld. Assessing Officer. 2.0 The only issue raised by the assessee through its Ground of Appeal, that arises in this case is regarding an addition of Rs. ITA No.- 916/Del/2024 Bath Affairs 1,53,03,000/- made by the Ld. Assessing Officer u/s 68 on account of unexplained cash deposits in the bank account of the assessee. The Ld. Council of the assessee argued that the show cause notice issued by the Ld. Assessing Officer was vague and cryptic in as much as it was issued for taxing the income u/s 68/69 of the Act. Thus, the Ld. Assessing Officer was not confident as to whether the impugned addition was liable to be made u/s 68 or u/s 69 of the Act. Before the Ld. First Appellate Authority, assessee had taken to argument that no addition u/s 68 was permissible since the credit in the form of cash was available in assessee’s bank account or to say in the books of account of the banks and not of the assessee’s. The Ld. Council for the assessee submitted that whereas Ld. First Appellate Authority concurred that section 68 was not applicable it proceeded to confirm the addition u/s 69A of the Act. It is the case of assessee that section 69A of the Act gets attracted in a case where books of account are not maintained by the assessee and that in the present case the Ld. Assessing Officer has himself given a finding that all the transactions were recorded in the books of account. The Ld. Council for the assessee further filed a Page 2 of 6 V / ITA No.- 916/Del/2024 Bath Affairs comprehensive paper book indicating that all the sales made by it was recorded in its books of account. The Ld. DR placed reliance upon the order of lower authorities. 3.0 We have heard rival submissions in the light of material available on records. As regards, the controversy regarding confirmation of addition made by the Ld. Assessing Officer, by the Ld. CIT(A) u/s 69A is concerned, we find force in the argument of the assessee that as the Ld. Assessing Officer himself the given a finding in the order that transactions were recorded in assessee’s books of account, there cannot be any justifications for making addition u/s 69A. Coming to the next limb of controversy that if the transactions were recorded in assessee’s books of accountthere cannot be any justifications for making addition u/s 69A, we find that again there exists sufficient force in the arguments of the assessee that section 69A is only attracted in cases where transaction are not recorded in the assessee’s books of account and that since in the present case, the same were, admitted by the Assessing Officer himself, recorded in the assessee’s books of account there cannot be any case of addition in impugned section. The assessee on its part have also through its paper book Page 3 of 6 ITA No.- 916/Del/2024 Bath Affairs submitted details to indicate that all the sales was recorded in the books of account, VAT returns etc. We also find force in the arguments of Ld. Council qua acceptance of assesee’s audited books of account by the Assessing Officer without pointing any defect u / si45.We have also noted the extensive paper book filed by the assessee dated 12.03.2025 , from pages 14 to 28 contains instances alluding that sales were indeed recorded in the assessee’s books of account. Be that as it may be, we are of the view that ends of justice would be made if the Ld. Assessing Officer is given an opportunity to examine the details filed by the assessee before us through its paper book dated 12.03.2025. Accordingly, the order of lower authorities is set aside and the Ld. Assessing Officer is directed to conduct a limited verification of details filed before us including paper book dated 12.03.2025. In the event of impugned sales are found duly recorded in the assessee’s books of account, the Ld. Assessing Officer is directed to delete the addition of Rs. 1,53,03,000/-. The Ld. Assessing Officer shall give due opportunity of being heard to the assessee. Accordingly, all the grounds of appeal raised by the assessee on this issue are allowed for statistical purposes. Page 4 of 6 ITA No.- 916/Del/2024 Bath Affairs 4.0 Before us the assessee has raised the additional grounds of appeal challenging the Assessment Order and Appellate Order on legal parameters. As, we have accepted the challenge of the assessee qua non-application of section 153A in this case and directed the Ld. Assessing Officer to conduct a limited verification and to consequently delete the addition, the impugned additional ground is left open. 5.0 In the result, the appeal of the assesseeis allowed for statistical purposes. Order nronounced in the Open Court on21-03.2025 Dated: 21/03/2025. Pooja/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT Sd/- (VIKAS AWASTHY) JUDICIAL MEMBER Sd/- (AMITABH SHUKLA) ACCOUNTANT MEMBER Page 5 of 6 "