DADI VENKATA RAMESWARA RAO,VISAKHAPATNAM V. INCOME TAX OFFICER, WARD-2(1), VISAKHAPATNAM

ITA 191/VIZ/2025

AI Insights

The case involves Dadi Venkata Rameswara Rao, the appellant, who contested the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi, concerning the assessment year 2017-18. The primary issue was the addition of Rs.46,71,000 as unexplained cash deposits during the demonetization period, under section 69A of the Income Tax Act. The CIT(A) had dismissed the appeal ex-parte for non-prosecution, which the appellant challenged, arguing that the dismissal was unjust as it did not consider the explanations and documents provided regarding the cash deposits from his bar and restaurant business. The Tribunal agreed with the appellant's contention and remanded the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312127 (ITAT-VISAKHAPATNAM)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA VILLURI
• Assessee Lawyers: GVN HARI
• Keywords: Set aside

Judgement Text

" आयकर अपीलीय अधिकरण, धिशाखापटणम पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Visakhapatnam Bench, Visakhapatnam Before Shri Vijay Pal Rao, Vice President and Shri Balakrishnan S., Accountant Member आ.अपी.सं /ITA No.191/Viz/2025 (निर्धारण वर्ा/Assessment Year: 2017-18) Dadi Venkata Rameswara Rao Visakhapatnam [PAN : AFHPD5141B] Vs. Income Tax Officer Ward-2(1) Visakhapatnam (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri GVN Hari, AR (through Hybrid hearing) रधजस् व द्वधरध/Revenue by: Dr.Aparna Villuri, DR सुिवधई की तधरीख/Date of Hearing: 30/04/2025 घोर्णध की तधरीख/Date of Pronouncement: 30/04/2025 आदेश / ORDER PER. VIJAY PAL RAO, VICE PRESIDENT : This appeal filed by the assessee is directed against the order dated 24.01.2025 of Commissioner of Income Tax (Appeals) [“Ld.CIT(A)”], National Faceless Appeal Centre, Delhi for the assessment year 2017-18. 2. The assessee has raised the following grounds of appeal : 1) The order of the learned Commissioner of Income Tax (Appeal) is contrary to the facts and also the law applicable to the facts of the case 2 ITA No.191/Viz/2025 Dadi Venkata Rameswara Rao . 2) The learned Commissioner of Income Tax (Appeals) is not justified in not giving sufficient opportunity of hearing to the appellant and in dismissed the appeal ex-parte. 3) Without prejudice to the above, the learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs.46,71,000 made by the assessing officer u/s 69A of the Act towards unexplained cash deposits during demonetization period. 4) Any other ground that may be urged at the time of appeal hearing. 3. At the time of hearing, the learned AR of the assessee has submitted that the Ld.CIT(A) has dismissed the appeal of the assessee while passing the ex-parte order for non-prosecution. Thus, the addition made by the Assessing Officer (“the AO”) of Rs.46,71,000/- on account of unexplained deposit in the bank has been confirmed. The Ld.AR has referred to the reply to the show cause notice placed at page No.29 as well as bank account statement placed at page No.44 of the paper book and submitted that the assessee has explained the source of the cash as sales of Indian Made Foreign Liquor (“IMFL”) as the assessee is running bar and restaurant for the past several years. The assessee has declared the turnover of Rs.2,91,10,200/- during the year and therefore, the cash generated from the business was deposited in the bank account. The bank account statement reveals that the cash deposited was used only for making the payments for purchase of the 3 ITA No.191/Viz/2025 Dadi Venkata Rameswara Rao liquor. Thus, the Ld.AR has submitted that without considering the details and reply already filed by the assessee, the Ld.CIT(A) has dismissed the appeal ex-parte. He has also referred to para 7 of the assessment order and submitted that the AO has made additions by recording the fact that there is partial reply on behalf of the assessee. Thus, the Ld.AR has pleaded that the matter should be remanded to the record of the Ld.CIT(A) for fresh adjudication on merits. 4. On the other hand, Ld.DR has raised no serious objection if the matter is remanded to the record of the Ld.CIT(A) for fresh adjudication. 5. Having considered the rival submissions and careful perusal of the record, we find that the Ld.CIT(A) has stated in para 4 that during the appeal proceedings, several notices were issued, giving opportunities of being heard to the assessee, but no response is received till date. However, the Ld.CIT(A) has not given a single detail of the alleged notices that were issued to the assessee. The Ld.CIT(A) has dismissed the appeal of the assessee for non-prosecution and in the absence of any reply / documentary evidence in support of the grounds of appeal. Accordingly, in the facts and circumstances of the case, it is manifested that without considering the reply and record already filed by the assessee during the assessment proceedings, the Ld.CIT(A) has dismissed the appeal while 4 ITA No.191/Viz/2025 Dadi Venkata Rameswara Rao passing the impugned ex-parte order. Hence, in the facts and circumstances of the case, when the Ld.CIT(A) has not passed speaking order based on the records available with the AO, the impugned order of the Ld.CIT(A) is set aside and matter is remanded to the record of the Ld.CIT(A) for fresh adjudication after giving appropriate opportunity of hearing to the assessee. 6. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the Open Court on conclusion of hearing on 30th April, 2025. Sd/- Sd/- (BALAKRISHNAN S.) ACCOUNTANT MEMEBR (VIJAY PAL RAO) VICE PRESIDENT Hyderabad, Dated 30th April, 2025 L.Rama, SPS 5 ITA No.191/Viz/2025 Dadi Venkata Rameswara Rao Copy to: S.No Addresses 1 Shri Dadi Venkata Rameswara Rao, D.No.3-20/1, Kothapalem, Gopalapatnam, Visakhapatnam 2 The Income Tax Officer, Ward-2(1), Income Tax Office, Infinity Towers, Sankaramatam Road, Visakhapatnam 3 The Pr.CIT, Visakhapatnam 4 The DR, ITAT Visakhapatnam Benches 5 Guard File TRUE COPY SENIOR PRIVATE SECRETARY ITAT, VISAKHAPATNAM "