Nirchem Dyes and Chemicals Pvt Ltd, Mumbai V. Income-tax Officer 7(2)(4), Mumbai

ITA 267/MUM/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6673 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2024
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Next Hearing Date: 29-05-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 17-01-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause
• Section: 68; 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “B” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI RAJ KUMAR CHAUHAN (JUDICIAL MEMBER) ITA No. 267/MUM/2024 Assessment Year: 2017-18 Nirchem Dyes and Chemicals Pvt. Ltd., 305-306, 3 rd floor, Anand Building, Kazi Sayed Street, Masjid Bunder, Mumbai-400003. Vs. Income-tax Officer 7(2)(4), Aayakar Bhavan, M.K. Road, Mumbai-400020. PAN NO. AAACV 2935 L Appellant Respondent Assessee by : Mr. Akash Kumar Revenue by : Mr. Ashok Kumar Ambastha, Sr. DR Date of Hearing : 30/05/2024 Date of pronouncement : 04/06/2024 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 30.11.2023 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2017-18, raising following grounds: 1. The Commissioner of Income Appeal Centre, Delhi (hereinafter referred to as the framing an ex parte order. 2. The CIT(A) erred in upholding the action of the Income - 7(2)(4), Mumbai (hereinafter referred to as the Assessing Officer) in making aggregate addition of Rs 48,75,500 under section 68 of the Act, on account of cash deposited in bank account during demonetisation period which arises out of sales. The appellants contend that on the facts and in the circumstances of the case and in law, the CIT(A) ought not to have upheld the impugned addition as he inasmuch as the cash deposited in the bank account is arising out of sales duly recorded in the books of account. 2. At the outset, the the assessee could not comply the for the reason that assessee was contemplating to opt for Vivad se Vishwas Scheme. However, due to shortage of the fund, the assessee could not could not respond to the notices is an undertaking on behalf of the assessee restored back to the file of the Ld. CIT(A), a raised by the Ld. CIT(A) 3. We have heard rival submission of relevant material on record. We find that due to non the part of the assessee before the Ld. CIT(A), the Ld. CIT(A) sustained the addition made by the Assessing Officer observing as under: “During the course of ap given numerous opportunities in form of hearing notices u/s 250 of the Act, the same are tabulated in para 04 above. In response to Nirchem Dyes and Chemicals Pvt. Ltd 1. The Commissioner of Income-tax (Appeals) at National Faceless Appeal Centre, Delhi (hereinafter referred to as the CIT(A)) erred in framing an ex parte order. 2. The CIT(A) erred in upholding the action of the Income 7(2)(4), Mumbai (hereinafter referred to as the Assessing Officer) in making aggregate addition of Rs 48,75,500 under section 68 of the on account of cash deposited in bank account during demonetisation period which arises out of sales. The appellants contend that on the facts and in the circumstances of the case and in law, the CIT(A) ought not to have upheld the impugned addition as he has not appreciated the facts of the case inasmuch as the cash deposited in the bank account is arising out of sales duly recorded in the books of account. At the outset, the Ld. counsel for the assessee submitted that the assessee could not comply the notices issued by the Ld. CIT(A) for the reason that assessee was contemplating to opt for Vivad se Vishwas Scheme. However, due to shortage of the fund, the assessee could not opt for Vivad se Vishwas Scheme, could not respond to the notices issued by the Ld. CIT(A). He on behalf of the assessee that in case matter is to the file of the Ld. CIT(A), all the notices and queries raised by the Ld. CIT(A) would be duly responded. We have heard rival submission of the parties and perused the relevant material on record. We find that due to non the part of the assessee before the Ld. CIT(A), the Ld. CIT(A) sustained the addition made by the Assessing Officer observing as “During the course of appellate proceedings, the appellant was given numerous opportunities in form of hearing notices u/s 250 of the Act, the same are tabulated in para 04 above. In response to Nirchem Dyes and Chemicals Pvt. Ltd 2 ITA No. 267/MUM/2024 tax (Appeals) at National Faceless CIT(A)) erred in 2. The CIT(A) erred in upholding the action of the Income-tax Officer 7(2)(4), Mumbai (hereinafter referred to as the Assessing Officer) in making aggregate addition of Rs 48,75,500 under section 68 of the on account of cash deposited in bank account during The appellants contend that on the facts and in the circumstances of the case and in law, the CIT(A) ought not to have upheld the has not appreciated the facts of the case inasmuch as the cash deposited in the bank account is arising out Ld. counsel for the assessee submitted that notices issued by the Ld. CIT(A) for the reason that assessee was contemplating to opt for Vivad se Vishwas Scheme. However, due to shortage of the fund, the opt for Vivad se Vishwas Scheme, therefore, sued by the Ld. CIT(A). He gave that in case matter is ll the notices and queries the parties and perused the relevant material on record. We find that due to non-compliance on the part of the assessee before the Ld. CIT(A), the Ld. CIT(A) sustained the addition made by the Assessing Officer observing as pellate proceedings, the appellant was given numerous opportunities in form of hearing notices u/s 250 of the Act, the same are tabulated in para 04 above. In response to these notices the appellant did not make any submissions and only sought adjournment granted by this office by ample time. The first adjoumment was made on 04.01.2021 wherein the appellant had submitted that they were contemplating to opt for vivaad se vishwas scheme. However, after lapse of almost t proof for filing any Forms of VsVs Scheme. Further, it was also verified through CPC2.0 that the VsVs was not opted by the appellant till the date of passing of this order. Similarly, the appellant sought adjournme provided by this office. However, the appellant did not make any submission despite giving enough opportunity. Thus, it is clear that the appellant has no any contention to prove its point. Further, the appellant has failed sales made only for two months in the entire year. Also, assessee failed to substantiate the cash book with supporting vouchers. The assessee could not produce cross verification from the third parties. These details were neither furnished during the assessment proceedings as well as during appellate proceedings. In absence of any explanation/evidence from the appellant, I do not find any reason to interfere with the order of the Assessing Officer. Therefore, the ground no.1 and 2 of the appeal are dismissed.” 3.1 Before us, the Ld. counsel for the assessee has explained the reason for non-compliance as the assessee was contemplating to opt for ‘Vivad Se Vishwas Sche due to shortage of the fund, the assessee could not opt for the said scheme. Meanwhile, opinion, there is a reasonable Ld. CIT(A). Further, in for the assessee and in the interest of substantial justice, we set aside the order of the Ld. CIT(A) and restore t for deciding afresh after considering submission of the assessee. The grounds of the appeal of the assessee are for statistical purposes. Nirchem Dyes and Chemicals Pvt. Ltd these notices the appellant did not make any submissions and only sought adjournment three times. Each time adjourments were granted by this office by ample time. The first adjoumment was made on 04.01.2021 wherein the appellant had submitted that they were contemplating to opt for vivaad se vishwas scheme. However, after lapse of almost three years the assessee had not given any proof for filing any Forms of VsVs Scheme. Further, it was also verified through CPC2.0 that the VsVs was not opted by the appellant till the date of passing of this order. Similarly, the appellant sought adjournment 2 more times which were duly provided by this office. However, the appellant did not make any submission despite giving enough opportunity. Thus, it is clear that the appellant has no any contention to prove its point. Further, the appellant has failed to prove the point that why there were cash sales made only for two months in the entire year. Also, assessee failed to substantiate the cash book with supporting vouchers. The assessee could not produce cross verification from the third parties. ails were neither furnished during the assessment proceedings as well as during appellate proceedings. In absence of any explanation/evidence from the appellant, I do not find any reason to interfere with the order of the Assessing Officer. Therefore, the order of the Assessing Officer is upheld and the ground no.1 and 2 of the appeal are dismissed.” Before us, the Ld. counsel for the assessee has explained the compliance as the assessee was contemplating to Vivad Se Vishwas Scheme’ and settle the dispute. However, due to shortage of the fund, the assessee could not opt for the said , the Ld. CIT(A) pass the impugned. In our opinion, there is a reasonable cause for non-compliance before the Ld. CIT(A). Further, in view of the undertaking by the Ld. counsel for the assessee and in the interest of substantial justice, we set de the order of the Ld. CIT(A) and restore the matter back to him for deciding afresh after considering submission of the assessee. ds of the appeal of the assessee are accordingly for statistical purposes. Nirchem Dyes and Chemicals Pvt. Ltd 3 ITA No. 267/MUM/2024 these notices the appellant did not make any submissions and only three times. Each time adjourments were granted by this office by ample time. The first adjoumment was made on 04.01.2021 wherein the appellant had submitted that they were contemplating to opt for vivaad se vishwas scheme. However, hree years the assessee had not given any proof for filing any Forms of VsVs Scheme. Further, it was also verified through CPC2.0 that the VsVs was not opted by the appellant till the date of passing of this order. Similarly, the nt 2 more times which were duly provided by this office. However, the appellant did not make any submission despite giving enough opportunity. Thus, it is clear that the appellant has no any contention to prove its point. Further, the to prove the point that why there were cash sales made only for two months in the entire year. Also, assessee failed to substantiate the cash book with supporting vouchers. The assessee could not produce cross verification from the third parties. ails were neither furnished during the assessment proceedings as well as during appellate proceedings. In absence of any explanation/evidence from the appellant, I do not find any reason to interfere with the order of the Assessing Officer. order of the Assessing Officer is upheld and the Before us, the Ld. counsel for the assessee has explained the compliance as the assessee was contemplating to and settle the dispute. However, due to shortage of the fund, the assessee could not opt for the said the Ld. CIT(A) pass the impugned. In our compliance before the view of the undertaking by the Ld. counsel for the assessee and in the interest of substantial justice, we set he matter back to him for deciding afresh after considering submission of the assessee. accordingly allowed 4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on Sd/- (RAJ KUMAR CHAUHAN JUDICIAL MEMBER Mumbai; Dated: 04/06/2024 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Nirchem Dyes and Chemicals Pvt. Ltd In the result, the appeal of the assessee is allowed for nced in the open Court on 04/06 - Sd/ (RAJ KUMAR CHAUHAN) (OM PRAKASH KA JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Nirchem Dyes and Chemicals Pvt. Ltd 4 ITA No. 267/MUM/2024 In the result, the appeal of the assessee is allowed for /06/2024. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai