DAN COMPANY,KOLKATA V. ITO, WARD 44(1), KOLKATA

ITA 696/KOL/2024

AI Insights

The case involves Dan Company appealing against the order of the Commissioner of Income Tax (Appeals), which had dismissed their appeal on the grounds of limitation without deciding on the merits. The assessee was aggrieved by the addition of Rs.6,92,72,800 as unexplained cash deposit under section 69A of the Income-tax Act, 1961 for the Assessment Year 2018-19. The Tribunal found that the delay in filing the appeal was not intentional, as the assessee was unaware of the assessment order until a penalty order was received. The Tribunal noted the assessee's business involved acting as an agent between farmers and purchasers of ginger and garlic, and the deposits in question were not the assessee's income but transactions related to their agency business.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 28707 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Condonation of delay; Set aside; Unexplained cash credit
• Section: 195; 250; 69A

Judgement Text

" आयकर अपीलȣय अͬधकरण, कोलकाता पीठ ‘C’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH KOLKATA Before Shri Sanjay Garg, Judicial Member and Shri Rakesh Mishra, Accountant Member I.T.A. No.696/Kol/2024 Assessment Year: 2018-19 Dan Company .………. Appellant 231, Maharshi Debendra road, Posta, Kolkata-700007. (PAN: AADFD7069F) vs. Income Tax Officer, Ward-44(1), Kolkata. ……..… Respondent Appearances by: Shri G. Banerjee, AR appeared on behalf of the Appellant Shri Rajat Mitra, CIT, DR appeared on behalf of the Respondent Date of concluding the hearing: January 06, 2025 Date of pronouncing the order: January, 08, 2025 आदेश / ORDER Per Sanjay Garg, Judicial Member : The present appeal has been preferred by the assessee against the order dated 28.02.2024 of the Ld. Commissioner of Income Tax, (Appeal), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as the “Ld. CIT(A)”] passed u/s. 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) for Assessment Year (AY) 2018-19. 2. The assessee in this appeal is aggrieved by the action of the lower authorities in making/confirming the addition of Rs.6,92,72,800/- u/s. 69A of the Act on account of unexplained cash deposit in the bank account of the assessee. 3. At the outset, the Ld. Counsel for the assessee has invited our attention to the impugned order of the Ld. CIT(A) to submit that the Ld. CIT(A) has not 2 ITA No. 696/Kol/2024 Dan Company, AY 2018-19 decided the appeal on merit rather, on the ground of limitation. There was a delay of 195 days in filing the appeal before the Ld. CIT(A). The assessee moved an application for condonation of delay stating therein that the assessee did not receive any e-mail or other information for passing of the impugned assessment order. That the assessee had come to the knowledge of passing of the assessment order only when the penalty order u/s. 271AAA of the act was received by the assessee on 29.09.2023. It was pleaded that the delay in filing the appeal before the Ld. CIT(A) was not intentional. However, the Ld. CIT(A) did not get satisfied with the above explanation of the assessee and dismissed the appeal in limine being barred by limitation. 4. The Ld. Counsel for the assessee, in this respect, has explained that in fact, the partner of the assessee firm was not made aware about the passing of any assessment order. The e-mail, if any, remained unnoticed. Admittedly, no notice in physical form was sent to the assessee’s address. Assessee had specifically pleaded that the passing of the impugned assessment order did not come to its notice. Under the circumstances, we are of the view that the delay in filing the appeal before the Ld. CIT(A) may not be intentional on the part of the assessee. 5. The Ld. Counsel has further brought our attention to the impugned assessment order to submit that the impugned additions have been made by the Assessing Officer (AO) on account of unexplained cash credits in the bank account of the assessee. The Ld. Counsel in this respect has submitted that it was duly submitted before the AO that the assessee was in the business of trading in ginger and garlic. That the assessee acts like an agent between the farmers producing the ginger and garlic and the purchasers of the aforesaid crops. The purchasers remit the amount to the assessee and the assessee after retaining its commission remit the said amount to the farmers. That the aforesaid deposits were not the income of the assessee. The Ld. Counsel in this respect has also relied on a sample of statement of bank account of the assessee. He, in this respect, has submitted that the assessee may be given an 3 ITA No. 696/Kol/2024 Dan Company, AY 2018-19 opportunity to demonstrate the aforesaid facts by way of bank statement and other evidence before the AO. 6. Considering that the appeal of the assessee has not been decided by the Ld. CIT(A) on merits and further that the assessee has a fair case on merits otherwise, which needs to be thoroughly investigated on the part of the AO, we set aside the impugned order of the Ld. CIT(A) and restore the matter to the file of the AO for de novo assessment on this issue. Needless to say, that the AO will give proper and adequate opportunity to the assessee to present its case. The assessee will also properly participate in the proceedings before the AO and furnish requisite details as and when called for by the AO. With the above observation, the appeal of the assessee is treated as allowed for statistical purposes. 7. In the result, the appeal of the assessee stands allowed for statistical purposes. Order is pronounced in the open court on 08.01.2025 Sd/- Sd/- [Rakesh Mishra] [Sanjay Garg] लेखा सदèय/Accountant Member ÛयाǓयक सदèय/Judicial Member Dated: 08.01.2025 JD Sr. P.S Copy of the order forwarded to: 1. Appellant – Dan Company 2. Respondent – ITO, Ward-44(1), Kolkata 3. CIT(A), NFAC, Delhi 4. Pr. CIT 5. CIT(DR), True Copy By Order Assistant Registrar, ITAT, Kolkata "