NAGAIAH MARUTHAI,DINDIGUL V. ITO, WARD-1, DINDIGUL

ITA 3648/CHNY/2025

AI Insights

The case involves Nagaiah Maruthai, a wholesale fruit trader, who appealed against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), which confirmed the addition of Rs.1,99,63,320 as unexplained cash deposits to his income for the Assessment Year 2020-21. The AO had reopened the assessment based on discrepancies between the assessee's declared turnover and the cash deposits made. The CIT(A) upheld the AO's decision, leading to the current appeal. The Tribunal found that the assessee was not adequately represented in previous proceedings and granted a remand to the AO for a fresh assessment, allowing the assessee to present his case properly.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840924 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2020-2021
• Appeal Filed On: 02-12-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M.D. VIJAY KUMAR
• Assessee Lawyers: VELPANDIAR
• Section: 147; 148

Judgement Text

"आयकर अपीलीय अिधकरण ‘ए’ ा यपीठ, चे\u0012ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI \u0015ी एबी टी. वक\u0019, ा ियक सद एवं सु\u0015ी पदमा वती यस, लेखा सद क े सम\" BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND MS. PADMAVATHY.S, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 3648/Chny/2025 िनधा $रण वष$ /Assessment Year: 2020-21 Nagaiah Maruthai, 150, North Masi Street, Madurai, Now Residing at 3/356c, Near Palaniyappa Motors Natham Main Road, Vembarpatti (PO), Gopalpatti, Dindigul, Tamil Nadu-624 308 PAN: BCZPM 6135 N Vs. The Income Tax Officer, Ward-1, Dindigul (अपीलाथ\u0007/Appellant) (\b यथ\u0007/Respondent) अपीला थ\u0019 की ओर से/ Appellant by : Mr. Velpandiar, Advocate ()थ\u0019 की ओर से /Respondent by : Dr. M.D. Vijay Kumar, JCIT सुनवा ई की ता रीख/Date of Hearing : 17.02.2026 घोषणा की ता रीख /Date of Pronouncement : 25.02.2026 आदेश / O R D E R PER PADMAVATHY.S, A.M: This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short \"CIT(A)\") passed u/s. 250 of the Income Tax Act, 1961 (in short \"the Act\") dated 06.11.2025 for Assessment Year (AY) 2020-21. 2. The assessee is an individual and is engaged in the business of wholesale trading of fruits. The assessing officer (AO) reopened the Printed from counselvise.com ITA No. 3648/Chny/2025 Nagaiah Maruthai :- 2 -: assessment for the reason that the assessee has made cash deposits which is more than the turnover declared by the assessee in the return of income. The AO issued a notice under section 148 and also other notices calling for various details. Since the assessee did not respond to the notices the AO completed the assessment under section 147 were he made an addition of Rs.1,99,63,320 as unexplained cash deposits. Aggrieved, the assessee filed further appeal before the CIT(A). The assessee submitted that cash would have been received towards the credit sales made during the earlier years and therefore they cannot be any addition made towards unexplained cash deposit. The CIT(A) did not accept the submissions of the assessee and confirmed the addition made by the AO. The assessee is in appeal before the tribunal against the order of the CIT(A). 3. We heard the parties and perused the material on record. The Ld. AR submitted that the assessee is a wholesale fruit vendor and does not have the technical knowledge to access computers. The Ld. AR further submitted that the assessee therefore is completely dependent on counsel with regard to income tax matters who did not handle assessee's case properly. Accordingly the Ld. AR submitted that the assessee did not appear before the AO. The Ld. AR also submitted that in the line of business the assessee is engaged in the turnover is done in cash and the assessee has received cash against certain credit sales made during the earlier years. The Ld. AR submitted that before the CIT(A), the assessee could not represent the case properly because the CIT(A) has issued only one notice and did not call for any further details. The Ld. AR accordingly, prayed that the assessee be given one more opportunity be given to represent the case properly before the lower authorities. Considering the facts and circumstances unique to the assessee's case, we are inclined to give one more opportunity to the assessee by remitting the appeal Printed from counselvise.com ITA No. 3648/Chny/2025 Nagaiah Maruthai :- 3 -: back to the AO. The AO is directed to consider the impugned issue afresh by calling for necessary details and decide the case in accordance with law. The assessee is directed to file necessary documents in support of the impugned additions made by the AO and cooperate with appellate proceedings without seeking unnecessary adjournments. It is ordered accordingly. 4. Further, we also levy a cost of Rs.7,000/- (Seven thousand only) in the appeal since considerable time and efforts have been spent by the Exchequer and for the reason that the assessee being delinquent before the lower authorities. The same shall be paid by the assessee to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras within a period of one month from the date of receipt of this order and produce the receipt before the AO. 5. In result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 25th day of February, 2026 at Chennai. Sd/- Sd/- (एबी टी. वक\u0019) (ABY. T. Varkey) \u0001याियक \u0001याियक \u0001याियक \u0001याियक सद\bय सद\bय सद\bय सद\bय / Judicial Member (पदमा वती यस) (Padmavathy.S) लेखा लेखा लेखा लेखा सद\u0011य सद\u0011य सद\u0011य सद\u0011य /Accountant Member चे\u0013नई/Chennai, \u0016दनांक/Dated: 25th February, 2026. EDN, Sr. P.S आदेश क\u0019 \bितिल प अ े षत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b थ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF Printed from counselvise.com "