SANJEEV KUMAR AZAD,DANAPUR V. ASSESSMENT UNIT, INCOME TAX DEPARTMENT, DELHI

ITA 247/PAT/2025

AI Insights

The case involves Sanjeev Kr. Azad, the appellant, who appealed against the order of the National Faceless Appeal Centre (CIT(A)), which upheld the additions made by the Assessing Officer (AO) regarding undisclosed business income. The AO had noted substantial cash deposits in the appellant's bank account, which were disproportionate to his declared income, and estimated business income on a presumptive basis. The CIT(A) upheld the AO's decision in an ex parte order due to the appellant's non-compliance with notices during the appellate proceedings. The Tribunal found that the CIT(A) had passed the order without a detailed representation from the assessee and thus remanded the case back for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708194 (ITAT-PATNA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2022-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Business income; Opportunity of being heard; Salary income
• Section: 142(1); 133(6)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “PATNA BENCH, PATNA VIRTUAL HEARING AT KOLKATA Before Shri Sonjoy Sarma, Judicial Member and Shri Rakesh Mishra, Accountant Member I.T.A. No.247/Pat/2025 Assessment Year: 2022-23 Sanjeev Kr. Azad.………………….....…..…………………....Appellant Flat No.302, Radhe-Krishna Apartment, Goal Road, Danapur, Bihar-801503 [PAN: AICPA9561G] vs. Assessment Unit, NFAC, Delhi……….…............................…..…..... Respondent Appearances by: Shri Ravi Shankar, appeared on behalf of the appellant. Shri Ashwani Kumar, Sr. DR, appeared on behalf of the Respondent. Date of concluding the hearing : July 17, 2025 Date of pronouncing the order : July 18, 2025 आदेश / ORDER Per Sonjoy Sarma, Judicial Member: The present appeal has been preferred by the assessee against the order dated 27.03.2025 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’). 2. Brief Facts of the case are that the assessee filed its return of income for A.Y. 2022-23 declaring a total income of Rs.2,50,000. The return was processed under section 143(1) of the Income-tax Act, 1961. The case was subsequently selected for scrutiny under CASS based on the reason that substantial cash deposits had been made in the assessee's current account, disproportionate to the returned income. Notices under sections 143(2) and 142(1) were issued. During the assessment proceedings, the Assessing Officer (AO) noted that the I.T.A. No.247/Pat/2025 Sanjeev Kr. Azad 2 assessee had made cash deposits of Rs.9,27,88,340/- in a current account maintained with State Bank of India (SBI). The AO also verified Form 61A uploaded by SBI, confirming such deposits. The assessee, however, had declared only Rs.4,50,000/- as gross salary income in the return. The AO formed the view that the assessee was engaged in undisclosed business activity and had not declared any income there from. A notice under section 133(6) was issued to SBI, but no response was received. Based on the available material, and considering the bank's uploaded Form 61A verified by the principal officer, the AO proceeded to estimate the business income by applying a profit rate of 5% on total deposits of Rs.9,27,88,340/-, thereby adding Rs.46,39,417/- as business income under presumptive basis. 3. Against the order of AO the assessee preferred an appeal before the CIT(A), but did not comply with notices issued during the appellate proceedings. As a result, the CIT(A) passed an ex parte order upholding the addition made by the AO. 4. Dissatisfied with the above order assessee is in appeal before this tribunal at the time of hearing before us, the learned AR for the assessee submitted that the assessee was unable to appear before the authorities below due to non-receipt or other difficulties and could not present relevant documentary evidence to substantiate the nature of cash deposits. It was prayed that in the interest of justice, another opportunity may be granted to represent the case properly before the CIT(A). 5. On the other hand, the learned DR supported the orders of the lower authorities but did not object to the matter being remanded back for fresh adjudication. 6. We, after hearing both parties and perusing the materials available on record, observe that the CIT(A) passed the order ex parte, I.T.A. No.247/Pat/2025 Sanjeev Kr. Azad 3 without the benefit of detailed representation from the assessee. Even before the AO, the assessee's submissions were insufficient to explain the huge cash deposits. In the interest of justice and fair play, we are of the view that one more opportunity should be granted to the assessee to substantiate its claim before the CIT(A). Accordingly, we deem it appropriate to restore the matter back to the file of the CIT(A) with a direction to re-adjudicate the issues after affording reasonable opportunity of being heard to the assessee. 7. In the result, the appeal of the assessee is allowed for statistical purposes. Kolkata, the 18th July, 2025. Sd/- Sd/- [Rakesh Mishra] [Sonjoy Sarma] लेखा सदèय/Accountant Member ÛयाǓयक सदèय/Judicial Member Dated: 18.07.2025. RS Copy of the order forwarded to: 1. Appellant - 2. Respondent - 3.CIT (A)- 4. CIT- , 5. CIT(DR), //True copy// By order Assistant Registrar, Kolkata Benches "