MUTHUKRISHNAN KARUNANIDHI,CHENNAI V. ITO WARD(2) VELLORE, VELLORE

ITA 2171/CHNY/2024

AI Insights

The case involves Muthukrishnan Karunanidhi, who appealed against the order of the CIT(A) confirming the addition of Rs. 10,50,000 as unexplained cash deposits during the demonetization period under section 69A of the Income-tax Act, 1961. The assessee had deposited this amount in a post office during the demonetization period from November 9, 2016, to December 30, 2016. The Assessing Officer (A.O.) added this amount to the assessee's income as the source of the cash deposits was not explained. The CIT(A) upheld this addition, noting the absence of any substantial reply from the assessee during the appellate proceedings. However, the Tribunal found that the CIT(A) had not considered the documentary evidence provided by the assessee, which included five promissory notes explaining the source of the deposit. Consequently, the Tribunal remitted the matter back to the CIT(A) for a fresh decision, ensuring that the assessee is given a fair opportunity to present his case.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 107279 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 21-10-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 16-08-2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.ANITA
• Assessee Lawyers: S. SENDAMARAI KANNAN
• Keywords: Set aside; Principle of natural justice
• Section: 69A

Judgement Text

"आयकर अपीलीय अिधकरण, ‘सी’ \u0011ा यपीठ, चे\u0016ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI \u0019ी महा वीर िसंह, उपा \u001f एवं \u0019ी जगदीश, लेखा सद' क े सम BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2171/Chny/2024 िनधा 9रण वष9 /Assessment Year: 2017-18 Muthukrishnan Karunanidhi, C/o. Sendamarai Kannan, Advocate, 104, 22nd Street, Ashtalakshmi Nagar, Alappakkam, Chennai – 600 116. Vs. The Income Tax Officer, Ward(2), Vellore. [PAN: CEKPK 2164K] (अपीलाथ\u0007/Appellant) (\b\tयथ\u0007/Respondent) अपीला थF की ओर से/ Appellant by : Shri S. Sendamarai Kannan, Advocate HIथF की ओर से /Respondent by : Ms. R. Anita, Addl. CIT सुनवा ई की ता रीख/Date of Hearing : 21.10.2024 घोषणा की ता रीख /Date of Pronouncement : 21.10.2024 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee is against the order of Learned Commissioner of Income Tax, Appeal, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] dated 22.03.2024 confirming the addition of cash deposits during demonetization period of Rs.10,50,000/- u/s. 69A of the Income-tax Act, 1961 (hereinafter “the Act”). ITA No.2171/Chny/2024 :- 2 -: 2. The assessee has deposited cash of Rs. 10,50,000/- in post office during demonetization period i.e., from 09.11.2016 to 30.12.2016. The assessee is a partner in M/s. M.K. Constructions and has deposited Rs. 10,50,000/- in post office during the demonetization period. The assessee before the A.O has not been able to explain the source of cash deposit and therefore, the A.O has made the addition u/s. 69A of the Act. On appeal, the Ld. CIT(A) confirmed the addition stating that during the course of appellate proceedings, no reply has been filed by the assessee giving concrete impression that the assessee has nothing to say with regard to the unexplained cash deposits during demonetization period and confirmed the addition. 3. The Ld. Authorized Representative (A.R) of the assessee has contended that the Ld. CIT(A) has not considered the copy of five promissory notes enclosed with Form-35 explaining source of deposit and dismissed the appeal without considering the merit. 4. The Ld. Departmental Representative (DR), on the other hand, has relied on the orders of lower authorities. 5. We have heard the rival submissions, and perused the materials available on record. The Ld. CIT(A) has dismissed the appeal without ITA No.2171/Chny/2024 :- 3 -: considering the merit. The assessee has contended that he has submitted documentary evidence in support of its contention along with Form-35, which has not been considered by the Ld. CIT(A). We are of the opinion that keeping in view the principles of natural justice, the assessee be provided with another opportunity of hearing to substantiate his case before the Ld. CIT(A). Accordingly, we set aside the order passed by the Ld. CIT(A) and remit the matter back to the file of the Ld. CIT(A) to adjudicate this appeal afresh in accordance with law, after giving reasonable opportunity to the assessee. We also direct the Assessee to appear before the Ld. CIT(A) on the date of hearing without fail. In view of the above, the appeal filed by the assessee is allowed for statistical purposes. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 21st October, 2024. Sd/- Sd/- (महा वीर िसंह) (Mahavir Singh) उपा \u001f / Vice President (जगदीश) (Jagadish) लेखा लेखा लेखा लेखा सद\u0003य सद\u0003य सद\u0003य सद\u0003य /Accountant Member चे\u0003ई/Chennai, \u0005दनांक/Dated:21st October, 2024. EDN/- ITA No.2171/Chny/2024 :- 4 -: आदेश क\u0002 \u0003ितिलिप अ\tेिषत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b\tथ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Chennai 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF "