DCIT, CIRCLE-1(1), TRICHY V. SHRI P. KARUPPAIAH, PUDUKOTTAI

ITA 759/CHNY/2020

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0321 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-09-2022
• Assessment Year: 2016-2017
• Appeal Filed On: 06-09-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained investment; Additional evidence; Reasonable cause; Condonation of delay; Set aside

Judgement Text

आयकर अपील सं./ITA No.759/Chny/2020 िनधा रण वष /Assessment Year: 2016-17 The Dy. Commissioner – of Income Tax, Circle-1(1), Trichy. v. Mr.P.Karuppaiah, No.175/A1, Kulanthiranpattu, Alangudi Taluk, Pudukkottai-622 302. [PAN: BNCPK 6605 F ] (अपीलाथ /Appellant) ( यथ /Respondent) Department by : Mr.Chinthapalli Meher Chand, JCIT Assessee by : None सुनवाई क तारीख/Date of Hearing : 19.09.2022 घोषणा क तारीख /Date of Pronouncement : 19.10.2022 आदेश / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: This appeal filed by the Revenue is directed against the order of the Commissioner of Income Tax (Appeals)-1, Trichy, dated 26.06.2020 and pertains to assessment year 2016-17. 2. We find that appeal filed by Revenue is barred by limitation for which necessary petition for condonation of delay explaining reasons for delay has been filed, for which, the ld.Counsel for the assessee did not raise any objection. Having heard both sides and considered petition filed by the Revenue for condonation of delay, we are of the considered view that आयकर अपीलीय अिधकरण, ‘बी’ यायपीठ, चे ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: CHENNAI ी महावीर िसंह, माननीय उपा , एवं ी जी. मंजूनाथा, , माननीय लेखा सद के सम BEFORE SHRI MAHAVIR SINGH, HON’BLE VICE PRESIDENT AND SHRI G. MANJUNATHA, HON’BLE ACCOUNTANT MEMBER ITA No.759/Chny/2020 Mr.P.Karuppaiah :: 2 :: reasons given by Revenue for not filing the appeal within the time allowed under the Act comes under reasonable cause as provided under the Act for condonation of delay and hence, delay in filing of above appeal is condoned and appeal filed by the Revenue is admitted for adjudication. 3. The Revenue has raised the following grounds of appeal: 1. The order of the learned Commissioner of Income tax (Appeals), Trichy is contrary to the law, facts and circumstances of the case, 2. The CIT(A) erred in deleting the addition of Rs.2,01,13,042/- made by the Assessing Officer on a wrong assumption that net of tax returned income for AY 2016-17 Itself exceeds cash in hand balance without verification of books of accounts, 3.. The CJT{A} failed to appreciate the fact that the has neither produced the cash book before the Assessing Officer nor the CIT(A) to verify the claim of the cash in hand as on 31/03/2016. 4. The CJT(A) failed to note that even during the course of remand report the has furnished the cash book for the business of firewood only and not submitted the cash book for the business of sand and contract work and cash in hand was shown to Rs.1,88,180/- only as on 31/03/2016 In the cash book of firewood business, 5. The appellant craves to amend, modify, after, add or forego any ground(s) of appeal at any time before or during the hearing of appeal. 4. The brief facts of the case are that the assessee has filed its return of income for the AY 2016-17 on 14.04.2017 declaring total income of Rs.3,49,90,760/-. The case has been selected for ‘limited scrutiny’ under CASS for verification of high cash in hand shown in the balance sheet as compared to preceding year, more particularly, because of belated filing of return of income by the assessee for the AY 2016-17 after 07.11.2016 and cash deposits during demonetization. The assessee neither appeared before the AO nor filed details of cash in hand shown in the balance sheet. ITA No.759/Chny/2020 Mr.P.Karuppaiah :: 3 :: Therefore, the AO has made addition of Rs.2,01,13,042/- towards cash in hand as unexplained income of the assessee. 5. Being aggrieved by the assessment order, the assessee preferred an appeal before the Ld.CIT(A). Before the Ld.CIT(A), the assessee filed certain additional evidences and the Ld.CIT(A) called for Remand Report from the AO. The AO vide his letter dated 10.09.2019 submitted Remand Report without giving any comment on additional information filed by the assessee. Therefore, the Ld.CIT(A) based on information submitted by the assessee, deleted the addition made towards cash in hand on the ground that the income declared by the assessee for the AY 2016-17 is more than the amount of cash in hand shown in the balance sheet, and thus, the question of making addition does not arise. Being aggrieved by the order of the Ld.CIT(A), the Revenue is in appeal before us. 6. None appeared on behalf of the assessee. We have heard the ld.DR and perused the materials available on record. We find that although, the AO has made addition towards huge cash in hand shown in the balance sheet as unexplained investment in absence of any explanation from the assessee, but the Ld.CIT(A) has deleted the addition made by the AO on technical grounds by holding that income declared by the assessee for the relevant assessment year is higher than the cash in hand shown in the balance sheet. In our considered view, the reasons given by the Ld.CIT(A) appears to be hyper technical, because, the question of explaining cash in ITA No.759/Chny/2020 Mr.P.Karuppaiah :: 4 :: hand shown in the balance sheet is on the assessee. The assessee neither explained cash balance shown in the books of accounts with any evidences nor filed necessary details to justify how cash balance was generated. Therefore, we are of the considered view that the Ld.CIT(A) erred in deleting the addition made towards cash in hand shown in the balance sheet. Hence, we set aside the order of the Ld.CIT(A) and restore the issue back to the file of the AO and direct the AO to re-examine the case of the assessee and decide the issue in accordance with law. 7. In the result, the appeal filed by the Revenue is allowed for statistical purposes. Order pronounced on the 19 th day of October, 2022, in Chennai. Sd/- ( महावीर िसंह) (MAHAVIR SINGH) उपा /VICE PRESIDENT Sd/- (जी. मंजूनाथा) ( G. MANJUNATHA) लेखा सद य/ACCOUNTANT MEMBER चे ई/Chennai, दनांक/Dated: 19 th October, 2022. TLN आदेश क ितिलिप अ ेिषत/Copy to: 1. अपीलाथ /Appellant 4. आयकर आयु"/CIT 2. यथ /Respondent 5. िवभागीय ितिनिध/DR 3. आयकर आयु" (अपील)/CIT(A) 6. गाड फाईल/GF