Gunaseelan Janaki Radha, Erode V. ITO,Ward-1(2), Erode

ITA 491/CHNY/2021

AI Insights

The case involves Smt. Gunaseelan Janaki Radha, who appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. The appeal was related to the assessment year 2012-13, where the Income Tax Officer had reopened the assessment under section 147 of the Income Tax Act, 1961, due to unreported cash deposits totaling Rs.23 lakhs in the assessee's bank accounts. The Tribunal dismissed the appeal on the grounds that the assessee did not provide sufficient evidence to contest the profit rate applied by the Assessing Officer, which was deemed reasonable given the nature of the business.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134865 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-05-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 14-11-2021
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Principle of natural justice; Condonation of delay

Judgement Text

आयकर अपीलीय अिधकरण, ‘ए’ ᭠यायपीठ,चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI ᮰ी महावीर ᳲसह, उपा᭟यᭃ एवं ᮰ी मंजुनाथ. जी, लेखा सद᭭य के समᭃ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANJUNATHA.G, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.: 491/CHNY/2021 िनधाᭅरण वषᭅ/Assessment Year: 2012-13 Smt. Gunaseelan Janaki Radha, No.49/43, Kalaimagal Street, Erode – 638 001. PAN: AYYPR 0453L vs. The Income Tax Officer, Ward 1(2), Erode. (अपीलाथᱮ/Appellant) (ᮧ᭜यथᱮ/Respondent) अपीलाथᱮ कᳱ ओर से/Appellant by : Shri S. Sridhar, Advocate ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri AR.V. Sreenivasan, Addl.CIT सुनवाई कᳱ तारीख/Date of Hearing : 10.05.2023 घोषणा कᳱ तारीख/Date of Pronouncement : 17.05.2023 आदेश /O R D E R PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in Appeal No.CIT(A), Coimbatore- 3/10411/2019-20 dated 22.06.2021. The assessment was framed by the Income Tax Officer, Ward 1(2), Erode for the assessment 2 ITA No. 491/Chny/2021 year 2012-13 u/s.144 r.w.s.147 of the Income Tax Act, 1961 (hereinafter the ‘Act’), vide order dated 11.12.2019. 2. At the outset, it is noticed that this appeal by assessee is barred by limitation by 86 days. The assessee received the impugned appellate order on 22.06.2021 and appeal was to be filed on or before 21.08.2021 but actually it was filed on 15.11.2021 thereby there was a delay of 86 days. The assessee has filed affidavit for condonation of delay stating that this delay is due to pandemic period of Covid 19 and subsequent events and the Hon’ble Supreme Court in Miscellaneous Application No.665 of 2021 vide order dated 23.03.2020 has given directions that the delay are to be condoned during this period 15.03.2020 to 14.03.2021 and they have condoned the delay up to 28.02.2022 in Miscellaneous Application No.21 of 2022 vide order dated 10.01.2022. Since the Hon’ble Supreme Court has condoned the delay during the said period, respectfully following the same we condone the delay and admit the appeal. 3. The first issue in this appeal of assessee is as regards to violation of principles of natural justice as well as assumption of 3 ITA No. 491/Chny/2021 jurisdiction u/s.147 of the Act by reopening the assessment. For this, assessee has raised ground nos.1 to 6. 4. When a query was put to ld.counsel, he nodded his head in no and he has not argued anything on the principles of natural justice or on reopening of assessment u/s.147 of the Act. Accordingly, this ground of assessee’s appeal is dismissed as not pressed. 5. The second issue on merits is as regards to the order of CIT(A) confirming the action of the AO in assessing / computing business income at 8% of credit entries. For this, assessee has raised ground Nos.7 & 8, which need not be reproduced. 6. Brief facts are that as per information in the possession of Department, the assessee has made cash deposit to the tune of Rs.23 lakhs in savings bank account during the financial year 2011- 12 relevant to this assessment year 2012-13. The assessee has not filed any return of income for assessment year 2012-13 and hence, proceedings for reopening u/s.147 of the Act was initiated and accordingly notice u/s.148 of the Act was issued. The assessee is engaged in the business of textiles in the name of ‘Janakiradha Tex’ and most of transactions relates to her textile business. This finding 4 ITA No. 491/Chny/2021 is recorded by AO in assessment order. The assessee has maintained two accounts in City Union Bank, Erode i.e., one current account and one savings account. The AO noticed from the bank statement obtained that the total credit entries appearing in current account and savings account are Rs.2,09,91,982/- and Rs.30,30,898/- respectively. According to AO, the total credit appearing in the bank accounts comes to Rs.2,35,22,880/- and assessee failed to offer any explanation for the cash deposits made and accordingly, the same is treated as gross receipts from her business. The AO estimated the profit rate at 8% on the gross receipt of Rs.2,35,22,880/- being business transactions on account of credit appearing in current account and savings bank account. He assessed the income accordingly. Aggrieved, assessee preferred appeal before CIT(A). 7. We have heard rival contentions and gone through facts and circumstances of the case. Before us, the assessee could not submit any documentary evidence that the profit rate is lower than 8% as computed by the AO. The assessee has not maintained any books of accounts nor any bills and vouchers. Since the assessee could not substantiate that the profit rate applied by AO at 8% is higher and actually in this trade profit rate is lower, we have no 5 ITA No. 491/Chny/2021 alternative except to confirm the order of AO and that of the CIT(A). The appeal of the assessee is dismissed. 8. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open court on 17 th May, 2023 at Chennai. Sd/- Sd/- (मंजुनाथ. जी) (MANJUNATHA.G) लेखा सद᭭य/ACCOUNTANT MEMBER (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चे᳖ई/Chennai, ᳰदनांक/Dated, the 17 th May, 2023 RSR आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकरआयुᲦ /CIT 4. िवभागीय ᮧितिनिध/DR 5. गाडᭅ फाईल/GF.