INCOME TAX OFFICER, BALURGHAT V. PRAKASH CHANDRA SAHA, KUSHMANDI

ITA 1585/KOL/2024

AI Insights

The case involves an appeal by the Revenue against the order of the National Faceless Appeal Centre, Delhi, which had allowed the appeal of the assessee, Prakash Chandra Saha, for the Assessment Year 2018-19. The Revenue contested the CIT(A)'s decision to admit fresh evidences without a remand report, which was claimed to be in contravention of Rule 46A(3) of the Income Tax Rules, 1963. The primary issue was the addition of Rs. 1,93,26,069 as unexplained money and Rs. 1,90,269 as contractual receipts, which the AO had added to the assessee's income. The CIT(A) found that these amounts were related to the assessee's legitimate activities as a CSP agent and not unexplained money.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473872 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act, 1961, Income Tax Rules, 1963
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANU BISWAS
• Assessee Lawyers: PRAKASH CHANDRA SAHA; SELF
• Section: 148; 69; 69A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRI PRADIP KUMAR CHOUBEY, JM ITA No.1585/KOL/2024 (Assessment Year: 2018-19) Income Tax Officer O/o The ITO,w-3(4), Balurghat, Satyajit Manch, Beltalapark, Balurghat, West Bengal, 733103 Vs. Prakash Chandra Saha Sekendarpur Kantabari, Dakshin Dinajpur, West Bengal, 733132 (Appellant) (Respondent) PAN No. CPZPS5995G Assessee by : Shri Prakash Chandra Saha, Self Revenue by : Shri Ranu Biswas, DR Date of hearing: 18.03.2025 Date of pronouncement : 25.03.2025 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the Revenue against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 05.06.2024 for the AY 2018-19. 02. The only issue raised by the Revenue in various grounds of appeal is against admitting fresh evidences by ld CIT(A) without calling for the remand report which are in contravention of Rule 46A(3) of the Income Tax Rules, 1963 (‘the Rules’). 03. The facts in brief are that the assessee is a non-filer of return and as per order u/s 148A(d) of the Act dated 26.03.2022, there were financial transactions of ₹1,95,16,338/- by the assessee and Page | 2 ITA No.1585/KOL/2024 Prakash Chandra Saha; A.Y. 2018-19 accordingly the ld. AO held that the income of the assessee has escaped assessment for the following reasons:- a. Cash withdrawals through bearers cheque amounting to ₹1,93,26,069/- b. Contract receipts from Save Solutions Pvt. Ltd. amounting to ₹1,90,269/-. 04. Accordingly, notice u/s 148 of the Act was issued on 26.02.2022, which was complied with by the assessee by filing the return of income on 19.04.2022, declaring total income of ₹2,23,660/-. Thereafter, the statutory notices were duly served upon the assessee. However, there was no response from the assessee and finally, the ld. AO assessed the income at ₹1,97,40,000/- by making an addition of (i) cash withdrawals of ₹1,93,26,069/- as unexplained money and (2) ₹1,90,269/- in respect of contractual receipt. 05. In the appellate proceedings, the ld. CIT (A) allowed the appeal of the assessee by observing and holding as under:- “4. During the course of appeal proceedings, hearing notices were sent. In response, the appellant stated that he was appointed as Customer Service Point Agent (CSP Agent) by Save Solution Pvt. Ltd. on behalf of State Bank of India and all the credits and debits were pertaining to the customers. The appellant provided the certificate, Copy of the Bank Statement, Details of Commission Earned, Profit and Loss Account and Computation of Income. The details are as under: Page | 3 ITA No.1585/KOL/2024 Prakash Chandra Saha; A.Y. 2018-19 Page | 4 ITA No.1585/KOL/2024 Prakash Chandra Saha; A.Y. 2018-19 From the details filed by the appellant it is noticed that the AO added a sum ofRs. 1,93,26,069/- as unexplained money u/s 69A of the IT Act without conducting anyenquiries. When the appellant withdraw money from the bank account it cannot betreated as unexplained money u/s 69 A of the IT Act. Bank withdrawal cannot beunexplained money. The AO ought to have verified the sources of credits into thebank accounts. In this case, the source was transfer entries credited into his bankaccount as the appellant acted as CSP agent on behalf of Save Solutions Pvt Ltd.This sum only withdrawn and given to the respective customers. Hence, addition ofunexplained money of Rs.1,93,26,029/- is not maintainable as it was not unexplained money. Page | 5 ITA No.1585/KOL/2024 Prakash Chandra Saha; A.Y. 2018-19 6. On this transaction only, the appellant earned the commission as contractreceipt. This was duly admitted by the appellant in his return of income filed on19.04.2022 in response to the notice issued u/s 148 of the |T Act. If so, addition ofRs.1,90,269/- 0s also not maintainable. 7. In view of the facts discussed above, the AO is directed to delete both theadditions. 6. As a result, the appeal is Allowed. 06. After hearing the ld. DR and assessee who was personally present during the course of hearing, we observe that the assessee is acting as Customer Service Point (CSP) agent for State bank of India through Save Solutions Pvt. Ltd. and the source of credit in the assessee’s account by way of credit from the Save Solutions Pvt. Ltd. for which the ld. CIT (A) has given detail finding of fact. We note that the assessee is a very small agent acting on behalf of bank and whatever he withdraws was done on behalf of the bank. The ld. AO has simply treated the withdrawals from the account as unexplained u/s 69A of the Act, which ld. CIT (A) has correctly appreciated that the section 69A of the Act was not applicable. Source of money is not disputed and similarly, the money withdrawn was also handled by the assessee as per the direction of State Bank of India. Considering all these facts and circumstances , the appeal of the Revenue is dismissed. 07. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open court on 25.03.2025. Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 25.03.2025 Sudip Sarkar, Sr.PS Page | 6 ITA No.1585/KOL/2024 Prakash Chandra Saha; A.Y. 2018-19 Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "