MANOJ KUMAR SHARMA,DELHI V. ITO, WARD-60(1), NEW DELHI

ITA 2625/DEL/2023

AI Insights

The case involves Manoj Kumar Sharma, who appealed against the order of the CIT(A) sustaining an addition of Rs. 2,63,62,150 as unexplained cash deposits and setting aside an addition of Rs. 4,96,318 concerning unverified sundry creditors for the Assessment Year 2017-18. The appellant argued that the cash deposits were legitimate, stemming from his business in milk and milk products, which inherently involves substantial cash transactions. The ITAT noted the appellant's failure to comply with procedural requirements during the assessment and appellate proceedings but decided to remand the case for a fresh assessment, considering the nature of the business and the evidence provided.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 474628 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT KATOCH
• Assessee Lawyers: HIMANSHI AGGARWAL
• Keywords: Set aside
• Section: 143(3); 142(1); 143(2); 69A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’ NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA No. 2625/Del/2023 (Assessment Year : 2017-18) Manoj Kumar Sharma R-202, Chander Vihar, Mandavali Fazalpur, Patpar Ganj, Delhi – 92 PAN : ARHPS 6664 C Vs. ITO Ward – 60(1) New Delhi (Appellant) (Respondent) Assessee by Ms. Himanshi Aggarwal, C.A. Respondent by Shri Amit Katoch, Sr. D.R. Date of Hearing 11.02.2025 Date of Pronouncement 11.02.2025 O R D E R PER VIMAL KUMAR, JM: 1. The appeal filed by assessee is against the order dated 11.08.2023 of Learned Commissioner of Income Tax (Appeals)- NFAC, Delhi [hereinafter referred to as ‘Ld. CIT(A)’] under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] arising out of assessment order dated 18.12.219 passed by the Income Tax Officer, Ward-60(1), Delhi (hereinafter referred as ‘Ld. AO’) under section 143(3) of the Act for the Assessment Year 2017-18. -2- ITA No.2625/Del/2023 Manoj Kumar Sharma vs. ITO A.Y. 2017-18 2. Brief facts of the case are that the appellant/assessee electronically filed return of income for A.Y. 2017-18 on 07.11.2017 declaring income of Rs.10,44,860/-. The case was selected for complete scrutiny under CASS through e-proceeding mode. Notice under section 143(2) of the Act was issued on 30.09.2018 by ITO, Ward – 60(5), New Delhi. Later on, the case was transferred to Ward – 60(1) vide order under section 127 of the Act passed by Pr.CIT-20, New Delhi. Notices under section 142(1) of the Act were issued on 22.10.2019 and 13.11.2019. No compliance to the notices was made by the assessee. In ex parte proceedings statement of bank account of assessee were obtained. Another show-cause notice dated 12.12.2019 was also issued but assessee failed to furnish any detail/document/explanation etc. On completion of proceedings, learned AO vide order dated 18.12.2019 made addition of Rs.2,63,62,150/- on account of unexplained source of cash deposit under section 69A r.w.s 115BBE of the Act and Rs.4,96,318/- on account of unverified sundry creditors under section 69A r.w.s 115BBE of the Act. 3. Against order dated 18.12.2019, appellant/assessee preferred appeal before learned CIT(A) which was partly allowed vide order dated 11.08.2023 by sustaining the addition of Rs. 2,63,62,150/- and set aside the addition of Rs.4,96,318/-. 4. Being aggrieved, appellant/assessee preferred present appeal. -3- ITA No.2625/Del/2023 Manoj Kumar Sharma vs. ITO A.Y. 2017-18 5. Learned Authorized Representative for the appellant/assessee submitted that learned CIT(A) failed to appreciate that adding the income of Rs.2,63,62,150/- on account of unexplained source of cash deposit after ignoring the fact that assessee is engaged in the business of distribution and selling of milk and milk products. Thus, Revenue of the appellant includes selling of milk products include milk, buttermilk, curd etc. to various small vendors and door to door selling. Accordingly, due to very basic nature of its business substantial, revenue is received in cash which is obvious reasons of regular cash deposits in bank accounts of the appellant and the nature of such deposit happened in all past years and happening even currently due to nature of business of the assessee and this has been explained. 5.1 Learned Authorized Representative for the appellant/assessee submitted written submission with the following annexure: 1. Annexure – 1 : Bank Statement – Date wise cash deposit 2. Annexure – 2 : All Bank Statements for F.Y. 2016-17 3. Annexure – 3 : Bank Statement March, 2016 4. Annexure – 4 : Bank Statement April, 2017 5. Annexure – 5 : Ledger of Mother Dairy Fruit and Vegetable Pvt. Ltd. – Milk 6. Annexure – 6 : Ledger of Mother Dairy Fruit and Vegetable Pvt. Ltd. – Curd 6. Learned Departmental Representative for the Department of Revenue submitted that despite several opportunities appellant/assessee failed to attend Departmental proceedings. -4- ITA No.2625/Del/2023 Manoj Kumar Sharma vs. ITO A.Y. 2017-18 7. From examination of record in light of aforesaid rival contentions, it is crystal clear that learned CIT(A) vide ex parte order dated 11.08.2023 upheld addition of Rs.2,63,62,150/- and set aside the addition of Rs. 4,96,318/-. 7.1 Appellant/assessee claims to be engaged in business of distribution and selling of milk and milk products to various small vendors and receiving all various amounts in cash. Assessee has placed reliance on Bank statement, ledger of mother dairy as Annexed 1 to 6 from pages 3 to 104 of the paper book. It is a fact that appellant/assessee had failed to appear before the learned AO and CIT(A). In view of the above material facts and well settled principle of law, in interest of justice, it is considered expedient to restore the matter to the file of the learned AO for fresh decision in accordance with law. 8. In the result, appeal filed by assessee is allowed for statistical purposes. Order pronounced on this day 11th February, 2025 Sd/- Sd/- (SHAMIM YAHYA) (VIMAL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 11.02.2025 Pr i ti Y adav, S r. PS * -5- ITA No.2625/Del/2023 Manoj Kumar Sharma vs. ITO A.Y. 2017-18 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "