RAJAMANI NALLATHAL,KARUR V. ITO, WARD-1, KARUR

ITA 535/CHNY/2025

AI Insights

The case involves an appeal by Rajamani Nallathal against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Center, Delhi, for the assessment year 2021-22. The appellant contested the additions made by the Assessing Officer (AO) under various heads totaling Rs.2,12,70,292, including unexplained credit entries, unexplained investments, and unexplained interest paid on housing loans. The appellant argued that the AO did not provide sufficient time to submit details and that the additions were based on an incorrect understanding of the facts. The Tribunal noted the inadequacy of the AO's analysis and the lack of a comprehensive examination of the submissions, leading to the decision to remit the case back to the AO for a de novo assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 717419 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2021-2022
• Appeal Filed On: 24-02-2025
• Other Referred Cases: TIN box 249 ITR 216
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P. KRISHNA KUMAR
• Assessee Lawyers: Y. SRIDHAR; F
• Keywords: Set aside; Opportunity of being heard; Corroborative evidences; Unexplained cash credit; Unexplained investment

Judgement Text

"आयकर अपीलीय अधिकरण, ‘ए’ न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI माननीय श्री मनु क ुमार धिरर ,न्याधयक सदस्य एवं माननीय श्री अमिताभ शुक्ला, लेखा सदस्य क े सिक्ष BEFORE HON’BLE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND HON’BLE SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.535/Chny/2025 Assessment Years: 2021-22 Rajamani Nallathal, D.No.67/3, Karukkampalayam, Kondanthur, Aravakurichi, Karur, Tamil Nadu-639 206. [PAN: AREPN4321J] Income Tax Officer, Ward-1, Karur. (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Mr.Y.Sridhar, F.C.A. प्रत्यर्थी की ओर से /Revenue by : Mr.P.Krishna Kumar, JCIT सुनवाई की तारीख/Date of Hearing : 11.08.2025 घोषणा की तारीख /Date of Pronouncement : 13.08.2025 आदेश / O R D E R PER AMITABH SHUKLA, A.M : This appeal is filed by the assessee against the order bearing DIN & Order No.ITBA / NFAC / S / 250 / 2024-25 / 1071724840(1) dated 31.12.2024 of the Learned Commissioner of Income Tax [herein after “CIT(A), National Faceless Appeal Center[NFAC], Delhi, for the assessment year 2021-22. The reference to the word “Act” in this order hereinafter shall mean the Income Tax Act, 1961 as amended from time to time. Printed from counselvise.com ITA No.535/Chny/2025 Page - 2 - of 5 2.0 At the outset, the Ld.Counsel for the assessee proposed to file an additional ground of appeal for adjudication. It was contended that through the impugned additional ground the assessee wishes to challenge the action of the Ld.AO in not providing sufficient time to the assessee before concluding the impugned assessment. 3.0 Through the original appeal memo the appellant has contested the action of the Ld.AO in making addition of Rs.2,12,70,292/- under different heads comprising unexplained credit entries of Rs.1,97,85,342/-, Rs.11,38,752 as unexplained investment, Rs.1,46,200/- as income from other sources and Rs.2 lakhs as unexplained interest paid on housing loans. 4.0 The Ld.Counsel for the assessee filed a voluminous paper book and attempted to allude that the additions made by the Ld.AO were based upon inappropriate and incorrect understanding of the facts of the case. It was also argued that the Ld.AO has not provided him with adequate opportunity of being heard and had given very little time to submit its details and submissions. The Ld.CIT(A) also merely relied upon the argument of the Ld.AO qua non-production of requisite details while confirming the Ld.AO’s order. 5.0 Per contra, the Ld.DR relied upon the order of lower authorities. It was argued that the blame of non-submission of details was resting upon the assessee and hence no relief can be given. Printed from counselvise.com ITA No.535/Chny/2025 Page - 3 - of 5 6.0 We have heard the rival submissions in the light of material available on records. From the paper book filed by the assessee it is evident that some of the additions made by the Ld.AO are linked to inadequate understanding of the details on record or to the non- availability of submissions. Thus, on the issue of unexplained interest on housing loans the Ld.AO has made the additions of Rs.2 lakhs holding that the precise entry for interest is not available. The Ld.Counsel has argued that the entry of Rs.2 lakhs treated as unexplained by the Ld.AO includes interest and other charges. Similarly on the issue of addition of agricultural income of Rs.1,46,200/- the assessee has pleaded that it owns nearly 20 acres of land holding and has been engaged in the agricultural activity for earlier years also. The Ld.AO has merely proceeded to make the addition on the premise of lack ownership etc. We have also noted that there exists atleast an iota of truth in the pleadings of the assessee of not being given sufficient time to file details . Grant of sufficient opportunity of being heard is sina qua non for every judicial proceedings. General clauses Act provides for atleast seven days of opportunity to a litigant to comply with any statutory notices. We also however find merit in the argument of the Ld.AO regarding the assessee pushing the matter towards the fag end of the assessment and his helplessness to conclude so as to avoid the same getting barred by Printed from counselvise.com ITA No.535/Chny/2025 Page - 4 - of 5 limitation. In view of assessee’s reported deficient compliances, grant of short time alone however cannot be fatal to the assessment order per se. 7.0 Be that as it may be, we are of the view that the matter concerning additions of Rs.2,12,70,292/- have not been objectively and comprehensively analyzed by the lower authorities. We are of the view that ends of justice would be met if the assessee is given one last opportunity to present its case and file supporting evidences before the Ld.AO. The decision to remit it back to the Ld. AO is taken in view of the fact that an Assessing Officer is the fulcrum of assessment proceedings. He possess the first right and responsibilities to examine facts of a case before arriving at his decision qua determination of taxable income in a particular case. We have noted with respectful deference the decision of Hon’ble Apex Court in the case of TIN box 249 ITR 216 on the subject matter. Accordingly, the issue of addition of Rs.2,12,70,292/- made by the Ld. AO supra stands remitted back to the Ld. AO for fresh adjudication de novo by passing a speaking order. To the extent the order of lower authorities on this issue stands set aside. The Ld. AO shall give opportunities of being heard to the assesse and it shall be bounden upon the assesse to comply with the notices issued by the Ld. AO. Any non-compliance on the part of the assesse can be adversely viewed. The assessee is at liberty to produce all the evidences filed through its paper book before us including any other evidences deemed Printed from counselvise.com ITA No.535/Chny/2025 Page - 5 - of 5 relevant in support of its claims before the Ld. AO during the readjudication proceedings. Accordingly, all the grounds of appeal raised by the assessee are therefore allowed for statistical purposes. 8.0 In the result, the appeal of the is allowed for statistical purposes. Order pronounced on 13th , Aug-2025 at Chennai. Sd/- (मनु क ुमार धिरर) (MANU KUMAR GIRI) न्याधयक सदस्य / Judicial Member Sd/- (अधमताभ शुक्ला) (AMITABH SHUKLA) लेखा सदस्य /Accountant Member चेन्नई/Chennai, धदनांक/Dated: 13th , Aug-2025. KB/- आदेश की प्रतितिति अग्रेतिि/Copy to: 1. अिीिार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT - Chennai/Coimbatore/Madurai/Salem. 4. तिभागीय प्रतितिति/DR 5. गार्ड फाईि/GF Printed from counselvise.com "