SANIKERE VEERABHADRAPPA RAJU,CHITRADURGA V. ACIT, CIRCLE-2(2)(1), BANGALORE

ITA 518/BANG/2025

AI Insights

This case involves an appeal by Shri Sanikere Veerabhadrappa Raju against the order of the National Faceless Appeal Centre (NFAC), Delhi, concerning the assessment year 2016-17. The primary issues arose from discrepancies between the cash reported in the income tax return and the financial statements, as well as disallowed interest from M/s. Indiabulls. The Assessing Officer (AO) made additions to the income based on these discrepancies, which were contested by the assessee. The first appeal to the Commissioner of Income Tax (Appeals) was dismissed ex-parte due to the non-appearance of the assessee, attributed to an incorrect email ID used for communication. The Tribunal granted a further opportunity to the assessee to present his case, emphasizing the need for proper procedural adherence and fair hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711326 (ITAT-BANGALORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2016-2017
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MURALI MOHAN M
• Assessee Lawyers: THARUN KOTHARI
• Section: 142(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH : BANGALORE BEFORE SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No. 518/Bang/2025 Assessment Year : 2016-17 Shri Sanikere Veerabhadrappa Raju, Mruthynjaya Compound, Near Gayathri Temple, V P Extension, Chitradurga – 577 501. PAN: AGEPR2130C Vs. The Assistant Commissioner of Income Tax, Circle – 2(2)(1), Bangalore. APPELLANT RESPONDENT Assessee by : Shri Tharun Kothari, CA Revenue by : Shri Murali Mohan M, CIT-DR Date of Hearing : 16-07-2025 Date of Pronouncement : 25-07-2025 ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 27/02/2025 in respect of the A.Y. 2016-17. 2. The brief facts of the case are that the assessee filed his return of income on 31/03/2017. Thereafter the case was selected for scrutiny under CASS and notices u/s. 143(2), 142(1) were issued. The assessee also furnished the computation of income, financial statements and cash book. The AO based on the difference between the cash in hand reported in the return of income and the financial statements and the cash book, had directed the assessee to provide the consolidated financial statements and Printed from counselvise.com Page 2 of 3 ITA No. 518/Bang/2025 reconciliation for the said differences. Similarly, the AO had issued a notice about the interest debited from M/s. Indiabulls. The AO not satisfied with the explanations had made the addition of Rs. 31,77,017/- being the difference between the cash in hand reported in the return of income and the financial statements and the interest amount disallowed of Rs. 8,09,613/-. As against the said order, the assessee filed an appeal before the Ld.CIT(A). The assessee also contended that the order of the AO is not correct and explained that he is having several branches and having a consolidated financial statements which are also audited and therefore the addition made by the AO is not correct. The Ld.CIT(A) had also issued four hearing notices but the assessee had not appeared to the said notices and therefore the Ld.CIT(A) had decided the appeal ex-parte and dismissed the said appeal. 3. As against the said order, the assessee is in appeal before this Tribunal. 4. At the time of hearing, the Ld.AR submitted that the email ID given in form 35 is of the employee and he has not brought to the notice of the assessee about the hearing notices sent by the Ld.CIT(A). The Ld.AR further submitted that in form no. 36, the assessee’s correct email ID is given and submitted that all the details are available with the assessee and prayed an opportunity to submit the same before the AO. 5. The Ld.DR relied on the orders of the lower authorities. 6. We have heard the arguments of both sides and perused the materials available on record. 7. We have also perused the form no. 35 in which the assessee had mentioned the email ID as [e-mail] which relates to the employee of the assessee. Whereas in the form 36, assessee’s email ID is given as [e-mail]. Even though the assessee had submitted that the notices were sent to the employee’s email ID, the Ld.CIT(A) has no other Printed from counselvise.com Page 3 of 3 ITA No. 518/Bang/2025 option except to send the notices to the email ID mentioned in form 35. Therefore the non-appearance could also be attributed to the carelessness of the assessee. Even before the AO, the assessee had furnished some details but not filed the entire details. In such circumstances, we are of the opinion that one more opportunity may be granted to the assessee to put forth his case before the AO but on condition that the assessee should pay a cost of Rs. 5,000/- to the Income Tax Department and produce the receipt before the AO. Thereafter, the AO is directed to consider the issue afresh and pass a speaking order, after hearing the assessee. 8. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in the open court on 25th July, 2025. Sd/- Sd/- (LAXMI PRASAD SAHU) (SOUNDARARAJAN K.) Accountant Member Judicial Member Bangalore, Dated, the 25th July, 2025. /MS / Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order Assistant Registrar, ITAT, Bangalore Printed from counselvise.com "