Rajabhau Mantri Sah Patsanstha Maryadit, Jalgaon V. Income-Tax Officer, Ward 1(4), Jalgaon

ITA 498/PUN/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 9815 (ITAT-PUNE)
• Duration Of Justice: 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Appeal Filed On: 13-10-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice
• Section: 144; 143(1); 80P; 250; 143(2); 69A

Judgement Text

आयकर अपीलीय न्यायाधिकरण, पुणे न्यायपीठ, “बी” बेंच, पुणे में। ITAT-Pune Page 1 of 6 IN THE INCOME TAX APPELLATE TRIBUNAL, PUNE “B” BENCH, PUNE BEFORE SHRI SS VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI,ACCOUNTANT MEMBER आयकर अपऩल सं. / ITA No. 498/PUN/2021 निर्धारण वर्ा / Assessment Year : 2017-2018 Rajabhau Mantri Sah. Patsanstha Maryadit At & Post Kasoda, Jalgaon. PAN : AAAJR0682F . . . . . . . अपऩलधथी / Appellant बिधम / V/s. Income Tax Officer, Ward 1(4), Jalgaon. . . . . . . . प्रत्यथी / Respondent द्वारा / Appearances Assessee by : None for the Assessee Revenue by : Shri M. G. Jasnani सपिवधई की तधरऩख / Date of conclusive Hearing : 06/09/2022 घोर्णध की तधरऩख / Date of Pronouncement : 06/09/2022 आदेश / ORDER PER G. D. PADMAHSHALI, AM; The appeal is assailed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [for short “NFAC”] dt.18/08/2021 passed u/s 250 of Income-Tax Act, 1961 [for short “the Act”], which leapt out of best judgement order passed u/s 144 of the Act by ITO Ward1(4), Jalgaon [for short “AO”] dt. 24/12/2019, for assessment year [for short “AY”] 2017-2018. Rajabhau Mantri Sah. Patsanstha Maryadit ITA No. 498/PUN/2021 AY: 2017-18 ITAT-Pune Page 2 of 6 2. The sole dispute contested under the present appeal spins around sustainability of addition made u/s 69A on account of cash deposited during demonetisation period and its taxation u/s 115BBE of the Act. 3. Tersely stated facts borne out of record are; the assessee is a credit co-operative society and engaged in providing credit facilities to its member, has for AY 2017-18 filed its Income Tax Return [for short “ITR”] on 04/11/2017 declaring “NIL” taxable income after claiming a deduction u/s 80P for sum of ₹33,48,909/-. The ITR in the first instance was processed summarily u/s 143(1) of the Act and then subjected to CASS by service of notice dt. 23/08/2018 u/s 143(2) of the Act. The assessee by further issue of show cause notice u/s 144 [for short “SCN”] dt. 16/11/2019 was asked to explain the source and nature of cash deposits of ₹25,19,000/- found made into its JDCC bank and Central Bank of India, however in the absence of any representation on SCN, for time-barring reasons the assessment was finalised u/s 144 of the Act to the best of judgment on the basis of material available on record by Rajabhau Mantri Sah. Patsanstha Maryadit ITA No. 498/PUN/2021 AY: 2017-18 ITAT-Pune Page 3 of 6 assessing the total income at ₹30,12,608/- on account of following two items; a. Addition u/s 69A for sum of ₹25,19,000/- on account of unexplained cash deposits made during the demonetisation period. b. Disallowance of interest from banks u/s 80P(2)(a)(i) for sum of ₹4,92,708/- 4. The assessee’s submission in an appeal before first appellate authority did yield partial relief towards the claim of deduction u/s 80P, however the NFAC echoed with the views of Ld. AO in confirming the addition u/s 69A r.w.s. 115BBE, consequently the appellant is before the Tribunal seeking reversal of impugned addition. 5. In the absence of assessee, the ex-parte hearing was held, wherein the learned departmental representative [for short “DR”] inviting our attention to the factual matrix candidly submitted that, during the course of original assessment proceedings the assessee was short of sufficient time and opportunity to explain the nature and source of cash deposits made into its bank accounts and Rajabhau Mantri Sah. Patsanstha Maryadit ITA No. 498/PUN/2021 AY: 2017-18 ITAT-Pune Page 4 of 6 having regards to the nature of credit business the appellant engaged into, the matter needs to be remanded back to the file of Ld. AO for de-nova verification of claims in so far as the cash deposits are concerned. 6. After hearing to Ld. DR contentions; and subject to the provisions of rule 18 of Income Tax Appellate Tribunal Rules, 1963 [for short “ITAT, Rules”] perused the material placed on records and duly considered the facts of the case in the light of settled legal position. 7. We see that, it remained an undisputed fact that, the SCN seeking explanation about the nature and source of cash deposits was issued on 16/11/2019, and in the absence of any material or response from the assessee the assessment was farmed on 24/12/2019 and such addition remained unaltered in first appellate proceedings for the equi-reasons. Thus it is apparent and ispo-facto sufficient to hold that, the appellant during the original assessment proceedings was precluded by an insufficient time and insufficient opportunity to substantiate its claim Rajabhau Mantri Sah. Patsanstha Maryadit ITA No. 498/PUN/2021 AY: 2017-18 ITAT-Pune Page 5 of 6 in explaining nature and source of cash deposits, which ultimately culminated in the absence of evidential material, and same was perfunctorily confirmed by the NFAC in first appellate proceedings. In the event, the interest of justice will be served if the matter is restored back to the file of Ld. AO for de-nova adjudication in accordance with law on the ground of violations of principles of natural justice. 8. In the light of aforesaid discussion, the impugned NFAC order is set-aside and the file is restored back to the Ld. AO for fresh adjudication in terms of above. 9. Resultantly, the appeal of the appellant assessee is allowed in aforestated terms In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this Tuesday 06th day of September, 2022. -S/d- -S/d- SS VISHWANETHRA RAVI G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे/ PUNE ; दिन ांक / Dated : 06thday of September, 2022. Rajabhau Mantri Sah. Patsanstha Maryadit ITA No. 498/PUN/2021 AY: 2017-18 ITAT-Pune Page 6 of 6 आदेश की प्रधिधलधप अग्रेधिि / Copy of the Order forwarded to : 1.अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT, Pune (Mh-India) 4. The CIT, Jalgaon (Mh-India) 5. दिभ गीय प्रदिदनदि,आयकर अपीलीय न्य य दिकरण, पुणे “बी” बेंच, पुणे / DR, ITAT, Pune “B” Bench, Pune. 6. ग र्डफ़ इल / Guard File. आिेश नुस र / BY RDER, िररष्ठदनजीसदचि / Sr. Private Secretary आयकरअपीलीयन्य य दिकरण, पुणे / ITAT, Pune.