ISHAPRABHU CREDIT SOUHARDHA SAHAKARI NIYAMIT,BELAGAVI V. THE INCOME TAX OFFICER, WARD - 1, BELAGAVI

ITA 131/PAN/2024

AI Insights

The case involves Ishaprabhu Credit Souhardha Sahakari Niyamit, a credit co-operative society, which appealed against the order of the National Faceless Appeal Centre (NFAC) that confirmed an addition of \\u20b958,05,000 under section 68 of the Income-tax Act, 1961. This addition was initially made by the Assessing Officer (AO) following a direction from the Principal Commissioner of Income Tax (PCIT) to reframe the assessment due to failure to verify Special Bank Notes (SBN) deposited during the demonetisation period. The ITAT found that the NFAC did not adequately address the new evidences presented by the appellant, necessitating a remand for a comprehensive re-evaluation.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 26292 (ITAT-PANAJI)
• Duration Of Justice: 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: WT(D)
• Next Hearing Date: 26-11-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 16-05-2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: NAZEERA MOHAMMAD LD.
• Assessee Lawyers: VEERANNA MURGOD LD.
• Keywords: Set aside
• Section: 143(3); 250; 68

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, PANAJI ITAT-Panaji Page 1 of 4 BEFORE HON’BLE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER ITA Nos. 131/PAN/2024 Assessment Year : 2017-18 Ishaprabhu Credit Souhardha Sahakari Niyamit, At & Post Aravalli, Tal Bailhongal, Dist. Balgavi-5911074 PAN:AAAAI1578G . . . . . . . Appellant V/s Income Tax Officer, Ward-1, Belgavi. . . . . . . . Respondent Appearances Assessee by: Mr Veeranna Murgod [‘Ld. AR’] Revenue by : Ms Nazeera Mohammad [‘Ld. DR’] Date of conclusive Hearing : 26/11/2024 Date of Pronouncement : 27/11/2024 ORDER PER G. D. PADMAHSHALI, AM; The assessee by this appeal has challenged the DIN & Order No. ITBA/NFAC/S/250/2023-24/1063274117(1) dt. 23/03/2024 passed u/s 250 of the Income-tax Act, 1961 [for short ‘the Act’] by the National Faceless Appeal Centre, Delhi [for short ‘Ld. NFAC’] which ascended out of order of assessment passed u/s 143(3) r.w.s. 263 r.w.s. 144B of the Act for assessment year 2017-18 [for short ‘AY’] Ishaprabhu Credit Souhardha Sahakari Niyamit Vs ITO ITA Nos.131/PAN/2024 ITAT-Panaji Page 2 of 4 2. Briefly stated the facts of the case are that; 2.1 The assessee is credit co-operative society filed its return of NIL income on 23/03/2028. The case of the assessee was subjected to scrutiny assessment u/s 143(3) of the Act and resultant assessment was first completed vide order dt. 16/12/2019 whereby the returned income of the assessee was accepted without variation. 2.2 The Principle Commissioner of Income Tax [for short ‘Ld. PCIT’] invoking the provisions of section 263 of the Act had set aside the aforestated order of assessment and directed the Ld. AO to re- frame the assessment de-novo for his failure to verify the Special Bank Note [for short ‘SBN’] deposited by the assessee during the declared demonetisation period. 2.3 Pursuance thereto a fresh assessment order u/s 143(3) r.w.s. 263 r.w.s. 144B of the Act was framed on 09/03/2023 whereby a bullet addition of ₹58,05,000/- u/s 68 of the Act was made owning to assessee’s failure to substantiate the nature & source of such SBN deposit and assessed the total income accordingly. 2.4 Aggrieved assessee unsuccessfully challenged the former addition in appeal before Ld. NFAC. Ishaprabhu Credit Souhardha Sahakari Niyamit Vs ITO ITA Nos.131/PAN/2024 ITAT-Panaji Page 3 of 4 3. Further aggrieved, the assessee came in present appeal on as many as four augmentative grounds, reproduction of which deemed unnecessary in view of rule 8 of ITAT-Rules, 1963. However for the purpose of our adjudication it shall suffice to state that the sole & substantive issue in the present appeal hinges around solitary addition made u/s 68 of the Act. 4. We have heard the rival submissions and subject to rule 18 (supra) perused material placed on record. 5. We note that during the period of demonetisation the appellant had deposited SBN into its accounts which remained unexplained with substantive evidences to the satisfaction of Ld. AO. The assessee was indifferent in first appellate proceedings, as a result the former addition made u/s 68 of the Act was confirmed by the Ld. NFAC. In making aforestated addition and upholding the same, we note that both Ld. Tax authorities below have come to a concurrent findings that, assessee failed to prove twofold test with cogent evidences viz; (a) the sum of SBN deposited by the assessee were out of its closing balance held as at 08/11/2016 and (b) such closing balance was out of receipts emanated to it from customers in the course of its business. Ishaprabhu Credit Souhardha Sahakari Niyamit Vs ITO ITA Nos.131/PAN/2024 ITAT-Panaji Page 4 of 4 6. During the course of hearing, the appellant placed on record two paper-books containing 888 pages in total. After considering the rival submissions & voluminous documents produce we find force in the contention & prayer of the Ld. DR that, these evidences needs comprehensive & effective verification in dismantling the Revenue’s claim that the SBN deposited by the appellant were out of closing balance held by it, therefore the matter may be set-aside to the file of Ld. NFAC with necessary direction. The Ld. AR could hardly object the Revenue’s claim & prayer. In view thereof, without offering any comments on merits, we set-aside the impugned order and remand the file to the stage of its institution before Ld. NFAC with a direction deal therewith de-novo and pass a speaking orders in terms of section 250(6) of the Act. 7. In result, the appeal is allowed for statistical purposes. In terms of rule 34 of ITAT Rules, the order pronounced in the open court on date mentioned herein before. -S/d- -S/d- PAVAN KUMAR GADALE G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER Panaji/Dt: 27th day of November, 2024. Copy of the Order forwarded to : 1. The Appellant. 2. The Respondent. 3. The CIT(A)/NFAC Concerned 4. PCIT Concerned 5. DR, ITAT, Panaji Bench, Panaji 6. Guard File By Order, Sr. Private Secretary / AR ITAT, Panaji. "