Yash Alloys Pvt. Ltd., Kolkata V. ITO, Ward 8(2), Kolkata

ITA 443/KOL/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6075 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2024
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Appeal Filed On: 03-03-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Principle of natural justice; TDS; Set aside
• Section: 144; 40(a)(ia); 250; 69A

Judgement Text

आयकर अपीलीय अधिकरण कोलकाता 'सी' पीठ, कोलकाता म ें IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘C’ BENCH, KOLKATA श्री संजय गग ग , न्याधयक सदस्य एवं श्री संजय अवस्थी, ल े खा सदस्य क े समक्ष Before SRI SANJAY GARG, JUDICIAL MEMBER & SRI SANJAY AWASTHI, ACCOUNTANT MEMBER I.T.A. No.: 443/KOL/2024 Assessment Year: 2017-18 Yash Alloys Pvt. Ltd.................................................................Appellant [PAN: AAACY 2289 A] Vs. ITO, Ward 8(2), Kolkata........................................................Respondent Appearances: Assessee represented by: A.K. Tulsiyan, FCA. Department represented by: Md. Ghayasuddin, CIT(DR). Date of concluding the hearing : May 20 th , 2024 Date of pronouncing the order : July 3 rd , 2024 ORDER Per Sanjay Awasthi, Accountant Member: This is a case pertaining to an order passed u/s 144 of the Income Tax Act, 1961 (in short the 'Act') dated 24.12.2019. The brief facts are that return of income was filed by the assessee on 20.02.2018 for AY 2017-18 declaring total income of Rs. 19,15,200/-. It was seen by the Assessing Officer (hereinafter referred to as ld. 'AO') that the assessee had deposited Rs. 4,0,36,500/- during the demonetization period i.e. from 08.11.2016 to 31.12.2016 in as many as seven bank accounts held in several banks. It was further noticed that for the entire year cash deposits made in the bank accounts by the assessee were to the tune of Rs. 16,43,43,050/-. It is recorded I.T.A. No.: 443/KOL/2024 Assessment Year: 2017-18 Yash Alloys Pvt. Ltd. Page 2 of 4 in the ld. AO’s order that attempts to elicit explanation from the assessee did not bear fruit as there was no worthwhile compliance by the said assessee. Ld. AO thereafter proceeded to add Rs. 16,43,43,050/- u/s 69A of the Act. Ld. AO also disallowed Rs. 13,29,906/- u/s 40(a)(ia) of the Act. 1.1. Aggrieved with this order, the assessee approached the Commissioner of Income Tax (Appeals) [hereinafter referred to as ld. 'CIT(A)']. But there also notices fixing hearing of this appeal were, apparently, either not answered or were not satisfactorily responded to before the ld. CIT(A). Ld. CIT(A) also dismissed the appeal before him. 1.2. Aggrieved with the action of both the AO and ld. CIT(A), the present appeal was filed with the following grounds of appeal: “1. That the Ld. CIT(A) - NFAC, wrongly passed ex-parte order confirming all additions under Section 250 of the Income Tax Act, 1961 on the allegation of non-compliance whereas the assessee has only received notices dt. 25 07.2023 and 01.12.2023 and filed adjournment petition dated 08.08.2023 and 08.12.2023 as evident from the e-filing portal. The company factory is closed since 2021 and there is no proper accountant to provide details, which leads for seeking the time for filing the submission. This fact is evident from the last few years Income Tax Returns of the company. Hence the CIT(A) erred m not considering the abnormal condition & passing ex-parte order on the ground that the assessee has not made compliance before the AO & the AO has also pas sed the order u/s 144 of the Act. The same is denial of natural justice hence the appeal & assessment order both needs to be set aside. 2. That the Ld. CIT(A) - NFAC was wrong in confirming the addition of cash deposits of Rs. 16,46,43,050/-made during the F.Y 2016-7 relevant A.Y 2017-18 treating the unexplained cash credit u/s 69A in the hands of the assessee. The said amount is either cash sales or advance/debtors' realization from sales made. Sales is already credited in Profit & Loss Account for working the income for the year and if again sales realization is added it becomes double addition. Hence, addition made by AO and confirmed by Ld. CIT(A) -NFAC leads to double taxation, which is wrong and needs to be deleted. 3. That me La. CTT(A) - NFAC, was wrong in confirming the addition of Rs. 13,29,906/- u/s 40(a)(ia) of the Act, being 30 percent of Rs. 44,31,302/- alleging that the TDS was not deposited within due date. The disallowance made by the AO and confirmed by the Ld. CIT(A) is based on mere suspicion needs to be deleted. I.T.A. No.: 443/KOL/2024 Assessment Year: 2017-18 Yash Alloys Pvt. Ltd. Page 3 of 4 4. That the assessee craves to leave or add, alter, amend or withdraw any or all of the ground(s) of appeal before or at the time of hearing.” 2. It is seen that two paperbooks have been filed containing assessment orders of previous years and statement showing details of cash book and turnover for FY 2013-14 to FY 2018-19. The ld. A/R averred that the appellant did not get sufficient opportunity to satisfactorily explain the amounts leading to the impugned additions. 2.1. The ld. D/R fairly agreed that both the ld. AO and ld. CIT(A) have passed orders in an ex-parte manner and this was not the stage where a discussion could take place on the factual matrix surrounding the debit and credit entries in cash statements. 3. We have carefully considered the contention of the ld. A/R, ld. D/R and the documents placed before us. It is felt that the appellant deserves a chance to prove the genuineness of the cash entries which have led to assumptions of suspicious transactions. Accordingly, we set aside this case to the file of ld. AO for affording afresh opportunity to the appellant for pleading his case. 4. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in the open Court on 3 rd July, 2024. Sd/- Sd/- [Sanjay Garg] [Sanjay Awasthi] Judicial Member Accountant Member Dated: 03.07.2024 Bidhan (P.S.) I.T.A. No.: 443/KOL/2024 Assessment Year: 2017-18 Yash Alloys Pvt. Ltd. Page 4 of 4 Copy of the order forwarded to: 1. Yash Alloys Pvt. Ltd., 3, Middleton Row, 3 rd Floor, G Block, Kolkata, West Bengal, 700071. 2. ITO, Ward 8(2), Kolkata. 3. CIT(A)-NFAC, Delhi. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata