MOLLEY JAYAPRAKASH,TRIVANDRUM V. ITO, WARD-1(2), THIRUVANANTHAPURAM

ITA 432/COCH/2024

AI Insights

The case involves Molley Jayapraksh, a non-resident Indian, who appealed against the order of the National Faceless Assessment Centre / CIT(A) which confirmed the additions made by the Assessing Officer (AO) to his income for the assessment year 2017-2018. The AO had added Rs.34,00,000 as unexplained income from cash deposits and Rs.19,00,000 from another deposit, rejecting the appellant's explanations that these were from past savings and property sales respectively. The CIT(A) upheld these additions, leading to the appeal before the Tribunal. The Tribunal found that the CIT(A) had not adequately addressed the appellant's grounds and thus remanded the case for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46902 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Other Referred Cases: CIT v. Smt.P.K.Noorjahan (1999) 237 ITR 570 (SC)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL; SENIOR
• Assessee Lawyers: SURESHKUMAR C
• Keywords: Opportunity of being heard

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, COCHIN Before Shri Inturi Rama Rao, Accountant Member ITA No.432/Coch/2024 : Asst.Year 2017-2018 Molley Jayapraksh TC 3/746, House No.1 Kiran Garden, Kirali Nagar K.D.Road, Muttada PO Trivandrum – 695 025. PAN : BBVPJ0580P. v. The Income Tax Officer Ward 1(2) Trivandrum. (Appellant) (Respondent) Appellant by : Sri.Suresh Kumar C, CA Respondent by : Smt.Leena Lal, Senior AR Date of Hearing : 12.03.2025 Date of Pronouncement : 08.04.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Assessment Centre / Commissioner of Income- tax (Appeals) [“CIT(A)” for short] dated 18.12.2023 for the assessment year 2017-2018. 2. Briefly the facts of the case are that the appellant is an individual, a non-resident Indian, filed return of income for the assessment year 2017-2018 on 26th March, 2018 declaring income of Rs.38,200. Against the said return of income, assessment was completed by the Assessing Officer (“the AO”) vide order dated 26.12.2019 passed u/s.143(3) of the Income-tax Act, 1961 (“the Act”) at a total income of Rs.35,49,440. While doing so, the AO made addition of Rs.34,00,000 being cash ITA No.432/Coch/2024. Molley Jayaprakash. 2 deposit made as unexplained income of the assessee rejecting the explanation of the appellant that the said cash deposits were made out of past savings. The AO also levied tax u/s.115BBE of the Act. Similarly, the AO made an addition of Rs.19,00,000 being cash deposit made in Canara Bank on 21st October, 2016 and on 24.10.2016 rejecting the explanation of the appellant that the said deposits were made out of sale consideration received on the sale of property in the absence of confirmation from the buyers of the property. Accordingly, the AO made addition of Rs.19 lakh. 3. Being aggrieved by the assessment order, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO. 4. Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal. It is submitted that the CIT(A) grossly erred in sustaining the addition of Rs.34 lakh rejecting the bonafide explanation of the appellant. He further submitted by placing reliance on the judgment of the Hon’ble Supreme Court in the case of CIT v. Smt.P.K.Noorjahan (1999) 237 ITR 570 (SC), that when the assessee offers bonafide explanation in support of the source of cash deposits, the assessing authority is not justified in making the addition. It is further submitted that the lower authorities ought to have accepted the explanation offered by the appellant in support of the cash deposits. 5. On the other hand, the learned Senior Departmental Representative submits that the AO has passed a reasoned order and in the absence of any evidence brought on record in support of the ITA No.432/Coch/2024. Molley Jayaprakash. 3 explanation for the source of cash deposits, the AO is justified in rejecting the explanation of the appellant. Thus, she submits that no interference is called for in the order of the AO. 6. I heard the rival submissions and perused the material available on record. The only issue that arises for my determination is whether the AO is justified in making addition of Rs.34 lakh being cash deposited in the SB account of the appellant as unexplained money. No doubt, the appellant has offered explanation in support of the source of cash deposits made in the bank account. The appellant raised several grounds of appeal before the CIT(A) running into 11 grounds and also filed written submissions. The CIT(A) without adverting to the statement of facts, simply dismissed all the grounds without passing a reasoned order. Thus, in order to meet the ends of justice, I am of the considered opinion that the matter requires to be remanded to the files of the CIT(A) with a direction to dispose of the appeal afresh after adverting to the statement of facts by passing a speaking order. Needless to say, the CIT(A) shall afford a reasonable opportunity of being heard to the assessee before passing any order. 7. In the result, the appeal filed by the assessee is partly allowed. Order pronounced on this 08th day of April, 2025. Sd/- (Inturi Rama Rao) ACCOUNTANT MEMBER Cochin; Dated : 08th April, 2025. Devadas G* ITA No.432/Coch/2024. Molley Jayaprakash. 4 Copy to : 1. The Appellant. 2. The Respondent. 3. The CIT, Cochin. 4. The DR, ITAT, Cochin. 5. Guard File. Asst.Registrar/ITAT, Cochin "