POLLANGI CHINNAPPAN CHITTYBABU,AMBUR, VELLORE, TAMILNADU V. INCOME TAX OFFICER, WARD-3, VELLORE, VELLORE

ITA 1776/CHNY/2024

AI Insights

The case involves an appeal by the assessee, Pollangi Chinnappan Chittybabu, against the order of the CIT(A), which pertained to the assessment year 2017-18. The primary contention was the addition of Rs.62,41,500 as unexplained cash deposits under section 69 of the Income Tax Act, based on discrepancies noted by the Assessing Officer (AO) between the credits in the assessee's bank accounts and the trading results. The CIT(A) had initially rejected additional evidences submitted by the assessee, leading to the appeal. The Tribunal found that the CIT(A) had not provided adequate opportunity for the assessee to be heard, thus violating principles of natural justice.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46356 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KEERTHI NARAYANAN
• Assessee Lawyers: A.S.HARIHARA KUMAR
• Keywords: Set aside; Opportunity of being heard; Additional evidence; Principle of natural justice
• Section: 250

Judgement Text

"आयकर अपीलीय अधिकरण, ‘बी’न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: CHENNAI श्री एबी टी. वर्की, न्यायिर्क सदस्य एवं श्री अयिताभ शुक्ला, लेखा सदस्य क े समक्ष BEFORE SHRI ABY T VARKEY, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.1776/Chny/2024 निर्ाारण वर्ा /Assessment Years: 2017-18 Pollangi Chinnappan Chittybabu, No.3/97, Thattaparai Village, Kadavalam Post, Thuthipet Via Ambur, Vellore Dist, Tamil Nadu-635811 [PAN: AHJPC3990P] Income Tax Officer, Ward-3, Vellore. आयकर अपील सं./SA No.34/Chny/2024 (ITA No.1776/Chny/2024) निर्ाारण वर्ा /Assessment Years: 2017-18 (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Shri A.S.Harihara Kumar, C.A. प्रत्यर्थी की ओर से /Revenue by : Shri Keerthi Narayanan, JCIT सुिवाई की तारीख/Date of Hearing : 24.12.2024 घोर्णा की तारीख /Date of Pronouncement : 12.02.2025 आदेश / O R D E R PER AMITABH SHUKLA, A.M : These appeals are filed by the assessee against the order bearing DIN & Order No. ITBA/NFAC/S/250/2024-25/1064426150(1) dated 29.04.2024 of the Learned Commissioner of Income Tax [herein after “CIT(A), National Faceless Appeal Center[NFAC], Delhi, for the assessment years 2017-18 and Stay Petition No.34/Chny/2024 arising out of ITA No.1776/Chny/2024 for the assessment year 2017-18. ITA No.1776 & SA-34/Chny/2024 :- 2 -: Through the aforesaid appeals the assesse has challenged order u/s 250 dated 29.04.2024 passed by NFAC, Delhi. 2.0 The Ld. Counsel for the assessee informed that the main issue in the present appeal is that the Ld. First Appellate Authority has disposed of its appeal without giving proper opportunity is being heard. The Ld. Counsel explained that in the instant case, the Ld. AO had made addition of Rs.62,41,500/- u/s 69 of the act. The Ld. AO had noted that total credit of Rs.2,67,16,505/- was found in various bank accounts of the assessee, whereas the credits as per trading results were only Rs.48,43,311/- leading to an unexplained gap of Rs. 2,18,73,194/-. The Ld. Counsel submitted that the Ld. AO was not convinced of the assessee’s claim of intra accounts transfer. Observing that the case was selected for scrutiny to enquire into cash deposits made during the year, the Ld. AO proceed to add Rs.62,41,500/- u/s 69 of the act as unexplained cash deposits in accounts held by the assessee with Canara Bank and State Bank of India. The Ld. Counsel further informed that during the appellate proceedings it had introduced additional evidences before the Ld.CIT(A) who had called for a remand report from the Ld. AO under rule 46A. In the said remand report the Ld. AO had objected to admission of additional evidences. The Ld.CIT(A) had confronted the impugned evidences to the assessee and in the absence of any reply ITA No.1776 & SA-34/Chny/2024 :- 3 -: concluded that the assessee is not interested in prosecuting its case and therefore he rejected the additional evidences. The Ld. CIT(A) however had however given a relief of Rs. 15 lakhs to the assessee. The Ld. Counsel thus pleaded for relief. The Ld. DR relied upon the order of authorities below. 3.0 We have heard the rival submissions in the light of material available on records. It is an undisputed fact of the case that the ld. AO had made the impugned additions for want of requisite details from the assessee. The assessee had pleaded submission of additional evidences which were contested by the ld. AO in his remand report. It is also an admitted fact of the case that the assessee had not been able to respond to the solitary opportunity given by the Ld. CIT(A). Reasonable opportunity of being heard is the foundation stone of natural justice and cannot be violated by any quasi-judicial authority. We are of the view that the Ld. CIT(A) ought to have given another opportunity to the assessee to defend its case. Accordingly, we are of the view that ends of justice would be met if assessee is given one more opportunity to pursue its case before the Ld. First Appellate Authority. The order of the Ld.CIT(A) is therefore set aside and he is directed to re-adjudicate the matter qua addition confirmed by him after giving due opportunity of being heard and by passing a speaking order. The assessee shall comply to ITA No.1776 & SA-34/Chny/2024 :- 4 -: all the statutory notices issued and any non-compliance shall be adversely viewed. Accordingly, all the grounds of appeal raised by the assessee are allowed for statistical purposes. SA No.34/Chny/2024, Assessment Years: 2017-18 4.0 As the main appeal of the assessee raised vide ITA No.1776/ Chny/2024 stands disposed as above, the present stay petition No.34/Chny/2024 moved by the assessee has become infructuous and hence dismissed. 5.0. In the result, the appeals raised by the assessee are allowed for statistical purposes Order pronounced on 12th , February-2025 at Chennai. Sd/- ( एबी टी. वकी) (ABY T VARKEY) न्यानयक सदस्य / Judicial Member Sd/- (अयिताभ शुक्ला) (AMITABH SHUKLA) लेखा सदस्य /Accountant Member चेन्नई/Chennai, नदिांक/Dated: 12th , February-2025. KB/- आदेश की प्रतितिति अग्रेतिि/Copy to: 1. अिीिार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT – Chennai. 4. तिभागीय प्रतितिति/DR 5. गार्ड फाईि/GF "