Kiran Bhairu Tanavade, Kolhapur V. Income Tax Officer, Kolhapur, Kolhapur

ITA 830/PUN/2023

AI Insights

The case involves an appeal by Kiran Bhairu Tanavade against the order of the National Faceless Appeal Centre (NFAC), which confirmed the addition of unexplained cash deposits as income under sections 147 and 144 of the Income Tax Act, 1961. The appellant, an individual deriving income from agriculture, had not filed a return of income for the relevant assessment year but was later found to have deposited Rs. 20 lakhs in cash in his bank account. The Assessing Officer treated these deposits as unexplained income due to the absence of any return or explanation from the appellant during the assessment proceedings. The CIT(A) upheld this decision, noting the lack of evidence for agricultural income. The Tribunal found that the CIT(A) erred in not considering the additional evidence provided by the appellant and remitted the matter back to the Assessing Officer for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137609 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2023
• Appeal Filed By: Assessee
• Order Result: AllowedAllowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 16-07-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC” : PUNE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I.T.A.No.830/PUN./2023 Assessment Year 2023-2024 Kiran Bhairu Tanavade, At Devarde Post, Gavase Tal, Ajara Dist. Kolhapur Maharashtra. PIN - 416 505 PAN AFDPT7340G vs. The Income Tax Officer, Aayakar Bhavan, Kolhapur. PIN – 416 001. (Applicant) (Respondent) For Assessee : Shri Pratap Kulkarni For Revenue : Smt. Sonal Sonkavde Date of Hearing : 21.08.2023 Date of Pronouncement : 22.08.2023 ORDER PER INTURI RAMA RAO, A.M. : This is assessee appeal for assessment year 2023- 24, arises against the National Faceless Appeal Centre [in short “NFAC”] Delhi’s Din and Order No. ITBA/NFAC/S/250/2023-24/1053161112(1), dated 25.05.2023, involving proceedings u/s. 147 r.w.s. 144 of the Income Tax Act, 1961 (in short “the Act”). 2. Briefly the facts of the case are as under : The appellant is an individual derives income from agriculture. The assessee-appellant had not filed return of income u/sec.139 of the Act. Subsequently, on receipt of information that the assessee-appellant during the previous 2 I.T.A.No.830/PUN./2023 year relevant to the assessment year under consideration deposited cash of Rs.20 lakhs in his S.B. A/c maintained with State Bank of India, Sindhudurga, Sawantwadi bearing A/c No.31649229002, the Assessing Officer issued notice u/sec.148 on 22.03.2018. The assessee-appellant has not filed any return of income in response to the notice u/sec.148 nor responded to the notices of hearing. In the circumstances, the Assessing Officer completed the assessment u/sec.144 r.w.s. 147 by bringing to tax the cash deposited in the S.B. A/c maintained with SBI, Sindhudurga, Sawantwadi as unexplained income of the assessee vide order dated 05.12.2018. 2.1. Being aggrieved by the above additions, the assessee-appellant filed an appeal before the Ld. CIT(A)'s contending, inter alia, that the Assessing Officer was not justified in treating the cash deposits made in the S.B. A/c of SBI as unexplained income of the assessee, inasmuch as, the assessee-appellant made the said cash deposits out of agriculture income. The assessee-appellant also filed details of agricultural land holdings held by him, nature of the crop grown and copies of 7/12 extract etc. and certificate from the village Police Patil. Considering the evidence filed before him, the Ld. CIT(A) concluded that there is no evidence of expenditure incurred on agricultural activities and the Ld. 3 I.T.A.No.830/PUN./2023 CIT(A) noted that the assessee-appellant had not filed any return of income disclosing the agriculture income and, therefore, disbelieved the agriculture income and confirmed the action of the Assessing Officer. 3. Being aggrieved by the above order of the Ld. CIT(A), the assessee-appellant is in appeal before the Tribunal. It is contended during the course of hearing that the Ld. CIT(A), NFAC ought not to have discarded the evidences filed by the assessee-appellant in respect of the agricultural income / activities carried-out by the assessee-appellant and merely because no return of income was filed, no agricultural income was shown in the original return of income, cannot be a reason to disbelieve the agricultural income of the assessee- appellant. Learned counsel appearing for the assessee submitted that there is no obligation on the part of the assessee to file return of income in absence of any taxable income exceeding the maximum amount not chargeable to tax. 4. On the other hand, learned Sr. DR vehemently argued that the impugned assessment order of the Assessing Officer should be sustained, inasmuch as, the assessee- appellant had not cooperated with the Assessing Officer during the course of assessment proceedings. 5. I heard the rival submissions and perused the material on record and the orders of the authorities below. The 4 I.T.A.No.830/PUN./2023 issue in the present appeal relates to the addition on account of unexplained cash deposits in the S.B. A/c of SBI, Sindhudurga Branch, Sawantwadi. No doubt, during the course of assessment proceedings before the Assessing Officer the assessee-appellant neither filed any explanation as to the source of the cash deposits made in the S.B. A/c maintained with SBI Sindhudurga Branch nor filed the return of income. It is only during the course of appellate proceedings before the Ld. CIT(A), the assessee-appellant had filed an explanation stating that the cash deposits in the S.B. A/c of SBI were made out of the agricultural income derived by him in respect of the agricultural activities. The assessee-appellant had filed evidences such as agricultural land holdings held by him, nature of the crop grown and copies of 7/12 extract etc. and certificate from the village Patil. Needless to mention that when additional evidence was filed for the first time by the assessee-appellant before the Ld. CIT(A), it is incumbent upon the CIT(A) to call for a remand report from the Assessing Officer on the additional evidence and based on such remand report, the CIT(A) should decide the matter in issue after considering the explanation tendered in respect of cash deposits. However, in the present case, the CIT(A) merely jumped to the conclusion that the explanation filed by the assessee-appellant is not credible and accordingly confirmed the addition. The Ld. CIT(A) while reaching to such a 5 I.T.A.No.830/PUN./2023 conclusion also noted that the assessee-appellant had not filed return of income disclosing the agricultural income. I find that the reasoning of the Ld. CIT(A) is untenable in the eyes of law, inasmuch as, there is no statutory obligation on the part of an assessee-appellant to file return of income in absence of a taxable income exceeding maximum amount not chargeable to tax. Thus, the approach of the CIT(A) is totally erroneous and cannot be sustained in the eye of law. Therefore, in order to meet the ends of justice, I remit the matter back to the file of Assessing Officer in the interest of substantial justice with a direction to the Assessing Officer to consider the evidences filed and the explanation tendered by the assessee-appellant in respect of the cash deposits before the NFAC and decide issue in accordance with law, after affording reasonable opportunity of hearing to the by the assessee-appellant. Ordered accordingly. 6. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 22.08.2023. Sd/- [INTURI RAMA RAO] ACCOUNTANT MEMBER Pune, Dated 22 nd August, 2023 VBP/- 6 I.T.A.No.830/PUN./2023 Copy to 1. The applicant 2. The respondent 3. The NFAC, Delhi. 4. The CIT-1, Pune 5. D.R. ITAT, Pune “SMC” Bench, Pune 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches, Pune.