OSIA IMPEX, CHENNAI V. ITO, NON CORPORATE WARD-1(6), CHENNAI

ITA 553/CHNY/2023

AI Insights

The case involves M/s. Osia Impex, which appealed against the order of the Commissioner of Income Tax (Appeals) confirming the addition of \\u20b932,69,580 as unexplained investments under section 69 of the Income Tax Act, 1961. The Assessing Officer had initially added this amount to the assessee's income, noting discrepancies in the stock valuation between the opening and closing balances. The Tribunal found that the assessee had not adequately responded to the Assessing Officer's inquiries and thus remitted the matter back for a detailed examination after the assessee submits the required documentation.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135327 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 06-09-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 30-04-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURESH GUDURI
• Keywords: Unexplained cash credit; Unexplained investment; Opportunity of being heard; Set aside
• Section: 68; 69; 143(3)

Judgement Text

आयकर अपीलीय अिधकरण, ’ए’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘A’ SMC BENCH, CHENNAI ŵी वी दुगाŊ राव Ɋाियक सद˟ के समƗ Before Shri V. Durga Rao, Judicial Member आयकर अपील सं./I.T.A. No.553/Chny/2023 िनधाŊरण वषŊ/Assessment Year: 2018-19 M/s. Osia Impex, 39, Usman Road, T. Nagar, Chennai 600 017, Tamil Nadu. [PAN:AACFO1393C] Vs. The Income Tax Officer, Non Corporate Ward 1(6), Chennai. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Ms. Hema Muralikrishnan, Advocate ŮȑथŎ की ओर से/Respondent by : Shri Suresh Guduri, JCIT सुनवाई की तारीख/ Date of hearing : 07.09.2023 घोषणा की तारीख /Date of Pronouncement : 13.09.2023 आदेश /O R D E R This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi dated 20.03.2023 relevant to the assessment year 2018-19. 2. Brief facts of the case are that the assessee has filed its return of income for the assessment year 2018-19 on 25.08.2018 declaring total income at ₹.61,020/-. The case was selected for complete scrutiny and after considering the details furnished by the assessee, the Assessing I.T.A. No. 553/Chny/23 2 Officer has completed the assessment under section 143(3) of the Income Tax Act, 1961 [“Act” in short] assessing total income of the assessee at ₹.48,00,692/- after making addition of ₹.32,69,580/- as unexplained investments under section 69 of the Act and ₹.14,70,092/- as unexplained cash credits under section 68 of the Act. On appeal, after considering the submissions of the assessee, while confirming the addition made under section 69 of the Act, the ld. CIT(A) deleted the addition made under section 68 of the Act and partly allowed the appeal of the assessee. 3. On being aggrieved on confirmation of addition made under section 69 of the Act, the assessee carried the matter in appeal before the Tribunal. 4. Heard both the sides, perused the materials available on record and gone through the orders of authorities below. During the course of assessment proceedings on verification of balance sheet, the Assessing Officer noted that during the year under consideration ₹.32,69,580/- has been taken as opening stock of Bullions for the financial year 2017-18. But, in the balance sheet as at 31.03.2017 furnished by the assessee closing stock stood at NIL. Therefore, the assessee has booked excess opening stock in the year under consideration due to which the profit of I.T.A. No. 553/Chny/23 3 the assessee was undervalued for the year. In this regard, the Assessing Officer called for explanation and documentary evidence from the assessee. The assessee had not furnished any reply to the show cause notice. Accordingly, the Assessing Officer added the amount of ₹.32,69,580/- to the total income of the assessee as unexplained investment under section 69 of the Act r.w.s. 115BBE of the Act. On appeal, the ld. CIT(A) confirmed the addition. 4.1 Before the Tribunal, by filing copy of the financial statements for the assessment years 2017-18 and 2018-19, the ld. Counsel for the assessee has submitted that the assessee has stopped its business and the closing stock as on 31.03.2017 and opening stock as on 01.04.2017 are the same. However, in the assessment, the Assessing Officer has noted that the assessee has not filed any details and there was no proper response from the assessee. In view of the above, the order of the ld. CIT(A) on this issue is set aside and remit the matter back to the file of the Assessing Officer and the assessee is directed to fill all details before the Assessing Officer. By considering the details and after verification, the Assessing Officer shall decide the issue in accordance with law by affording reasonable opportunity of being heard to the assessee. 5. In the result, the appeal filed by the assessee is allowed for I.T.A. No. 553/Chny/23 4 statistical purposes. Order pronounced on 13 th September, 2023 at Chennai. Sd/- (V. DURGA RAO) JUDICIAL MEMBER Chennai, Dated, 13.09.2023 Vm/- आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3.आयकर आयुƅ/CIT, 4. िवभागीय Ůितिनिध/DR & 5. गाडŊ फाईल/GF.