JATINDER SINGH (HUF),KALBADEVI V. INCOME TAX OFFICER, MUMBAI

ITA 1779/MUM/2025

AI Insights

The case involves Jatinder Singh (HUF), who appealed against the order of the National Faceless Appeal Centre, Delhi, which was passed under section 250 of the Income-tax Act, 1961 for the assessment year 2017-18. The appeal was initially against the order of the Income-tax Officer, Ward-23(1)(5), Mumbai, which was based on findings that the assessee had deposited a significant amount of cash during the demonetization period, and the sales reported were unreasonably high. The CIT(A) upheld the assessment order, leading to the current appeal. The tribunal found that the assessee was not given a reasonable opportunity of hearing at the CIT(A) level and thus remanded the case back for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 126139 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASSESSEE; AFTER HEARING; ASIF KAR MALI
• Keywords: Set aside
• Section: 142(1); 143(2); 250; 139(1); 68

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “J(SMC)”, MUMBAI BEFORE SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER AND SHRI ANIKESH BANERJEE, JUDICIAL MEMBER ITA No.1779/Mum/2025 (Assessment year: 2017-18) Jatinder Singh (HUF) 413-F, Vasantwadi, Kalbadevi Road, Kalbadevi, Mumbai-400 002 PAN: AAEHJ8442H vs Income-tax Officer Ward 23(1)(5), Mumbai. Room No.114, 1st Floor, Matru Mandir, Tardeo Road, Mumbai-400 007 APPELLANT RESPONDENT Assessee by : None Respondent by : Shri Asif Karmali (Sr.DR) Date of hearing : 23/04/2025 Date of pronouncement : 24/04/2025 O R D E R Per Anikesh Banerjee (JM): The instant appeal of the assessee was filed against the order of the National Faceless Appeal Centre, Delhi (NFAC) [in short, ‘Ld.CIT(A)’]passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’)for A.Y. 2017-18, date of order 28/02/2025. The impugned order emanated from the order of the Learned Income-tax Officer, Ward-23(1)(5), Mumbai (in brevity, ‘Ld.AO’) passed under section 143(3), date of order 26/12/2019. 2 ITA 1779/Mum/2025 Jatinder Singh (HUF) 2. When the appeal was called for hearing, none was present on behalf of the assessee. No adjournment petition was filed. Considering the merit of the case, we find that the appeal can be disposed of exparte qua for assessee, after hearing the Ld.DR. 3. We heard the Ld.DR and considered the documents available on the record. The assessee filed the return of income under section 139(1) declaring total income at Rs.29,75,705/-. The case was selected for complete scrutiny under CASS and notice under section 143(2) of the Act was served on the assessee. The assessee is a manufacturer and trader of cloths. The assessee is also proprietor of “Gee Tee Textiles”. During the impugned assessment year, it was found that the assessee deposited cash of Rs.44,85,500/- during the demonetization period. A notice under section 142(1) was issued. In response to the same, the assessee replied that the cash was out of cash balance and cash sales. Finally, the assessee was asked to place the comparative chart for financial years 2014-15 and 2015-16 and the Ld.AO found that there during the demonetization period the cash sales were unreasonably high at 62.41% compared to the corresponding period in the earlier years. It was also noticed that for the period November, in F.Y. 2016-17, the cash sales stood at 15.42%. After factual consideration, the Ld.AO disallowed Rs.17,37,823/- as inflated sales to accommodate unexplained cash and added the same to the total income of the assessee under section 68 of the Act and further, the Ld.AO added 10% of the total expenses claimed in relation to motor car in view of personal use and the disallowance was made amount to Rs.55,021/-. The aggrieved assessee filed an appeal before the Ld. CIT(A). But the Ld.CIT(A) issued the notice on different dates for hearing and there was no compliance from the end of the assessee. Even no adjournment application was filed before the 3 ITA 1779/Mum/2025 Jatinder Singh (HUF) appellate authority. Finally, the impugned assessment order was upheld by the order of the Ld.CIT(A). Being aggrieved on the impugned appeal order, the assessee filed an appeal before us. 4. The Ld.DR relied on the orders of the revenue authorities. 5. It emerges from the record that the assessee is aggrieved that the Ld.AO had erred in not considering the evidence which was submitted by the assessee such as VAT returns, quantity details of purchase and sales etc to substantiate sales made during the year and cash was deposited in the bank. But in any case, the Ld.CIT(A) passed the order exparte and the assessee was not getting a reasonable opportunity of hearing before the Ld.CIT(A). We found that the assessee was unable to submit the evidence in favour of its claim. So, the assessee was deprived of the chance to present its claim before the first appellate authority. We are, therefore, of the opinion that interest of justice should be served if the matter is remanded back to the file of the Ld.CIT(A) for consideration of assessee’s plea. The Ld.DR has not made any strong objection against the observation of the bench. We are not expressing any view on merits of the case so as to limit the appeal proceeding before the Ld. CIT(A). Needless to say, the assessee should get a reasonable opportunity of hearing for set aside appeal proceedings. On the other hand, the asessee should be diligent and cooperative in set aside appeal proceeding for expeditious disposal of the appeal. 4 ITA 1779/Mum/2025 Jatinder Singh (HUF) 6. In the result, the appeal of the assessee bearing ITA No.1779/Mum/2025 is allowed for statistical purpose. Order pronounced in the open court on 24th day of April, 2025. Sd/- sd/- (VIKRAM SINGH YADAV) (ANIKESH BANERJEE) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Mumbai,दिन ांक/Dated: 24/04/2025 Pavanan Copy of the Order forwarded to: 1. अपील र्थी/The Appellant , 2. प्रदिव िी/ The Respondent. 3. आयकरआयुक्त CIT 4. दवभ गीयप्रदिदनदि, आय.अपी.अदि., मुबांई/DR, ITAT, Mumbai 5. ग र्डफ इल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, Mumbai "