PEARTREE ENTAERPRISES PRIVATE LIMITED,DELHI V. ITO WARD 19 (4), DELHI

ITA 7039/DEL/2025

AI Insights

The case involves Peartree Enterprises P. Ltd., which appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, for the assessment year 2017-18. The primary issue was the addition of Rs. 44,17,500 as unexplained cash deposits during the demonetization period, which the Assessing Officer treated under section 68 read with section 115BBE of the Income Tax Act, 1961. The CIT(A) upheld the addition based on a remand report from the AO without providing it to the assessee for rebuttal, leading to a violation of the principles of natural justice. The Tribunal found merit in the assessee's contention and remanded the matter back to the CIT(A) for a fresh decision after allowing the assessee to respond to the remand report.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 835700 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Appeal Filed On: 03-11-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: OM PRAKASH
• Assessee Lawyers: SAKET SINGH
• Keywords: Set aside; Principle of natural justice

Judgement Text

"आयकर अपीलीय अधिकरण धिल्ली पीठ “सी”, धिल्ली श्री धिकास अिस्थी, न्याधयक सिस्य एिं श्री ब्रजेश क ुमार स िंह, लेखाकार सिस्य क े समक्ष IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “C”, DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER& SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER आअसं.7039/धिल्ली/2025(नि.व. 2017-18) ITA No.7039/DEL/2025 (A.Y.2017-18) Peartree Enterprises P. Ltd., C 4/142, Safdarjung Development Area, New Delhi 110016 PAN: AACCP-8759-Q ...... अपीलार्थी/Appellant बिाम Vs. Income Tax Officer, Ward-19(4), CR Building, ITO, IP Estate, New Delhi 110002 .....प्रनिवादी/Respondent अपीलार्थी द्वारा/ Appellant by: Shri Saket Singh, Advocate प्रधििािीद्वारा/Respondent by: Shri Om Prakash, CIT-DR सुिवाई की निथर्थ/ Date of hearing : 10/02/2026 घोषणा की निथर्थ/ Date of pronouncement : 10/02/2026 आदेश/ORDER PER VIKAS AWASTHY, JM: This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 03.09.2025, for AY 2017-18. 2. Shri Saket Singh appearing on behalf of the assessee submitted that the assessment for AY 2017-18 in the case of assessee was selected for complete scrutiny. The Assessing Officer (AO) during assessment proceedings observed that there were cash deposits to the tune of Rs.44,17,500/- during demonetization period. The assessee explained that the cash deposits by the assessee in bank Printed from counselvise.com 2 ITA No.7039/DEL/2025 (A.Y.2017-18) represents cash sales. The AO disregarding submission of the assessee made addition of the entire cash deposits in the bank i.e. Rs.44,17,500/-u/s.68 r.w.s. 115BBE of the Income Tax Act, 1961(hereinafter referred to as ‘the Act’). Aggrieved by the assessment order dated 30.12.2019, the assessee carried the issue in appeal before the CIT(A). In First Appellate proceedings, the assessee furnished detailed written submissions. A remand report was called by the CIT(A) on the submissions made by the assessee, the CIT(A) without providing copy of the remand report to the assessee and without seeking assessee’s reply to the said remand report confirmed the addition made by the AO. Thus, there has been violation of principles of natural justice. The CIT(A) has confirmed the addition on the basis of remand report without confronting the same to the assessee. The ld. Counsel prayed for providing a copy of the remand report to the assessee, so that the assessee can rebut the same. 3. Per contra, Shri Om Prakash representing the department strongly supported the impugned order and prayed for dismissing appeal of the assessee. The ld. DR submits that the assessee was granted fair opportunity of making submission by the CIT(A), since, the assessee failed to explain source of cash deposits to the satisfaction of AO, the addition was sustained by the CIT(A). 4. Both sides heard, orders of the authorities below examined. The sole grievance of the assessee in the present appeal is that, the CIT(A) has upheld the addition made by the AO in respect of cash deposits during demonetization on the basis of remand report without confronting the said remand report to the assessee. The CIT(A) at the back of the assessee has accepted the remand report from the AO, without providing opportunity of rebuttal. Considering entire facts of the case, Printed from counselvise.com 3 ITA No.7039/DEL/2025 (A.Y.2017-18) we deem it appropriate to restore this appeal back to the CIT(A) for denovo adjudication. The CIT(A) shall provide a copy of remand report to the assessee and shall provide reasonable opportunity to the assessee to furnish reply to the said remand report. 5. The CIT(A) shall decide appeal of the assessee after considering reply of the assessee, if any, in accordance with law. 6. In the result, impugned order is set aside and appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on Tuesday the 10th day of February, 2026. Sd/- Sd/- (BRAJESH KUMAR SINGH) (VIKAS AWASTHY) लेखाकार सदस्य/ACCOUNTANT MEMBER न्यानयक सदस्य/JUDICIAL MEMBER धिल्ली / Delhi, ददिांक/Dated 13/02/2026 NV/- प्रतिलिपि अग्रेपििCopy of the Order forwarded to : 1. अपीलार्थी/The Appellant , 2. प्रनिवादी/ The Respondent. 3. The PCIT 4. ववभागीय प्रनिनिथि, आय.अपी.अथि., सिल्ली /DR, ITAT, धिल्ली 5. गार्ड फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar) ITAT, DELHI Printed from counselvise.com "