PRABHADEVI, ERODE V. ACIT, CIRCLE-2, ERODE

ITA 90/CHNY/2022

• Counselvise Citation: [2022] 107 COUNSELVISE.COM (IT) 0735 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Appeal Filed On: 08-02-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Set aside
• Section: 68; 143(3)

Judgement Text

आयकर अपीलीय अिधकरण, ‘सी’ ᭠यायपीठ, चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI Įी महावीर ͧसंह, उपाÚय¢ एवं Įी मनोज क ु मार अĒवाल, लेखा सदèय के सम¢ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 90/Chny/2022 (िनधाŊरण वषŊ / Assessment Year: 2017-18) Prabhadevi 291, Banumathyillam, Chinnamuthu Street, EdayanKattuValasu, Erode – 638 011. बनाम/ Vs. ACIT Circle -2, Erode. ̾थायी लेखा सं./जीआइ आर सं./PAN/GIR No. AMTPP-7611-B (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎ की ओरसे/ Appellant by : Shri N. Arjun Raj, CA ŮȑथŎ की ओरसे/Respondent by : Shri P. Sajit Kumar, JCIT सुनवाई की तारीख/ Date of Hearing : 21.07.2022 घोषणा की तारीख / Date of Pronouncement : 03.08.2022 आदेश / O R D E R PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by assessee is arising out of the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in Appeal No. CIT(A), Coimbatore-3/10441/2019-20 vide order dated 27.12.2021. Assessment was framed by ACIT, Circle 2, Erode for AY ITA No: 90/Chny/2022 - 2 - 2017-18 u/s. 143(3) of the Income-tax Act, 1961 (herein after referred to as ‘the Act’) vide order dated 27.11.2019. 2. The only issue in this appeal of assessee is as regards to the order of CIT(A) confirming the action of the AO in making addition of cash deposits of Rs. 25.30 Lacs as unexplained cash credits u/s. 68 of the Act. For this issue, assessee has raised various grounds which need not to be reproduced. 3. Brief facts are that the assessee is an individual and declaring income from house property, income from business and agricultural income. The assessee is running the firm tasty food products. The assessee’s case was selected for scrutiny as assessee has declared large agricultural income and large cash deposits during demonetization. The AO noticed that there are cash deposits made by the assessee as under: 3.1 Cash deposits made by the assessee during the year: As per the submissions, the cash deposit made by the assessee during the year was arising out of the following sources: 1. Opening Cash Rs. 8,25,162/- 2. Drawings from Prabha Bakers Rs. 20,00,000/- 3. Rent from Lotus Residency Rs. 60,000/- 4. Net Agricultural Income Rs. 5,30,000/- Total Rs. 34,15,162/- The AO required the assessee to explain the source of this cash deposits and according to him the assessee is unable to prove the agricultural income declared at Rs. 5,30,000/- and the unexplained demonetization ITA No: 90/Chny/2022 - 3 - money of Rs. 20 Lacs, the Assessing Officer treated both the deposits and aggregated to Rs. 25.30 Lacs as unexplained cash credits u/s. 68 of the Act. The AO gave reason that the assessee is unable to explain these credits and assessee is unable to produce any evidence of cash demonetization deposits i.e., claim made by conducting business by producing the purchase/sale bills, the trade license, TIN Number, any registration with Government department, evidence to prove the business receipts, monthly sales tax return or any evidence of cash deposit made on regular intervals and also copy of adangal, sale of agricultural produce etc. As the assessee failed to provide these items, Assessing Officer added the entire cash deposits of Rs. 25.30 Lacs. Aggrieved, assessee preferred appeal before CIT(A). The CIT(A) simpliciter vide Para 5 which has confirmed the addition without passing a speaking order on the issues and evidences filed by assessee in its grounds of appeal and statement of facts. The CIT(A) in Para 5 given following findings: “ 5. ...... The appellant could not prove the earning of agricultural income with evidence like land records, purchases made for agriculture expenses, sale of agriculture produce before the AO or during appeal stage. Therefore, I do not find force in the submission of the appellant. The case law relied upon by the appellant or on their own footing and distinguishable either on facts or on issues involved. Thus, the addition of Rs. 25,30,000/- u/s. 68 is hereby confirmed.” ITA No: 90/Chny/2022 - 4 - 4. Now before us, Ld. Counsel for the assessee requested one more opportunity and directions to the CIT(A) to decide the issue after taking all the evidences on record and then passing a speaking order. On the other hand, the Ld. Senior DR could not controvert the above facts situation and he relied on the assessment order and the order of the CIT(A). 5. We noted that the order of the CIT(A) is not a speaking order and hence we set aside the same. Accordingly, the matter is set aside and issue remanded back to the file of the AO for passing fresh appellate order by speaking order after allowing reasonable opportunity of being heard to the assessee. 6. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 3 rd August, 2022. Sd/- Sd/- (मनोज कुमार अᮕवाल) (MANOJ KUMAR AGGARWAL) लेखा सद᭭य /ACCOUNTANT MEMBER (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चेɄई / Chennai; िदनांक / Dated : 03-08-2022 JPV आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथȸ/Appellant 2. Ĥ×यथȸ/Respondent 3. आयकर आय ु Èत (अपील)/CIT(A) 4. आयकर आय ु Èत/CIT 5. ͪवभागीय ĤǓतǓनͬध/DR 6. गाड[ फाईल/GF