SUNITA DEVI,PATNA V. ITO, WARD- 6 (1), PATNA

ITA 97/PAT/2025

AI Insights

This case involves an appeal by Sunita Devi against the order of the Commissioner of Income Tax (Appeals), which partly allowed her appeal concerning the addition of Rs. 1,26,24,890 to her income for the assessment year 2017-18. The addition was initially made by the Assessing Officer due to unexplained cash deposits during the demonetisation period. The Tribunal noted that the assessee had not complied with various notices at earlier stages but decided to remand the case to the Assessing Officer to consider new documents provided by the assessee, which were not previously submitted.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 787502 (ITAT-PATNA)
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Appeal Filed On: 28-02-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHWANI KR. SINGAL
• Assessee Lawyers: ARYAN RAJ; FILING
• Keywords: Set aside; Business income; Opportunity of being heard
• Section: 144; 133(6)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “PATNA” BENCH, PATNA (VIRTUAL HEARING AT KOLKATA) SHRI SONJOY SARMA, JUDICIAL MEMBER SHRI RAKESH KUMAR, ACCOUNTANT MEMBER ITA No. 97/Pat/2025 (Assessment Year 2017-18) Sunita Devi, Begma Ki Haveli, Khajekalan, Patna City - 800008 (PAN: AILPD0532D) Vs ITO, Ward 6(1), Patna (Appellant) (Respondent) Present for: Appellant by : Shri Aryan Raj, Advocate Respondent by : Shri Ashwani Kr. Singal, JCIT Date of Hearing : 16.10.2025 Date of Pronouncement : 19.11.2025 O R D E R PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “the Ld. CIT(A) dated 24.10.2023. The Registry has informed that there is a delay of 424 days in filing of this appeal, which has been requested to be condoned by the assessee by filing an affidavit as under: “I Smt. Sunita Devi, wife of Shri Shambhu Prasad, aged about 58 years, residing at Begma Ki Haveli, Pani Tanki, Khajekalan, Patna City, Patna - 800008, Bihar, do hereby solemnly affirm and state as under: 1. That I am the Appellant in the above-mentioned appeal and am fully conversant with the facts and circumstances of the case. Printed from counselvise.com 2 ITA No. 97/Pat/2025 Sunita Devi AY: 2017-18 2. That the impugned order was passed by the learned CIT(A) on 24/10/2023, and due to severe medical conditions and financial constraints, I was unable to file the appeal within the prescribed time limit. 3. That I filed the appeal on 25/02/2025 along with medical certificates. 4. That in this way there is delay of 490 days for which an application under section 5 of the Limitation Act has been filed along with memorandum of appeal. 5. That I was under continuous medical treatment and had to prolonged recovery, which prevented me from effectively managing my legal obligations. 6. That as soon as my health permitted and I was financially stable, I took immediate steps to file this appeal before this Hon'ble Tribunal. 7. That the delay in filing the appeal was not intentional, nor due to any negligence or laxity on my part, but due to bona fide reasons beyond my control: 8. That I submit that substantial justice should not be denied merely due to procedural delay and that the appeal may be decided on merits. 9. That I humbly request this Hon'ble Tribunal to condone the delay and allow my appeal in the interest of justice.” 1.2 On going through the petition, we are satisfied that the assessee had a sufficient cause for the delay, therefore, the delay is condoned and the appeal is admitted for adjudication. 2. The sole ground of appeal raised by the assessee is reproduced as under: “1. Addition of Rs. 1,26,24,890/- in income is bad in law.” 3. Brief facts of the case are that the assessee is an individual and is the proprietor of M/s Balajee Polly Packaging and had filed her return of income on 07.11.2017 showing total income of ₹4,52,050/. The return was selected for scrutiny under Computer Assisted Scrutiny Selection (CASS) for the reason \"cash deposit during demonetisation period\". Statutory notices were issued along with a questionnaire but the assessee did not comply with the notices issued. Thereafter a notice u/s 133(6) of the Act was issued calling for the bank statement and other details. On perusal of the bank statement, it was found that the assessee had deposited a sum of ₹1,17,84,500/- during the demonetisation period. Printed from counselvise.com 3 ITA No. 97/Pat/2025 Sunita Devi AY: 2017-18 Further, on perusal of P & L A/c and balance sheet of the appellant, it was also found that the assessee had shown total sales/gross turnover of ₹4,22,81,711/- which was over and above ₹4,05,35,287/- i.e. the amount credited in all the bank accounts during the year under consideration, but no explanation was furnished by the assessee regarding the nature and source of the cash of Rs. 1,17,84,500/- during the demonetisation period. Thus, the balance amount of Rs. 3,04,97,211/- was treated as turnover by the Ld. AO. Information sought from the Commercial Tax Department was, however, not received. The Ld. AO applied a Net Profit to turnover ratio @2% on this turnover and added the differential amount of Rs. 1,34,724/- (difference in NP computed and NP shown in the return) to the total income of the assessee as business income with other additions. Further, in the absence of any material evidence, the amount of cash deposited during the demonetisation period i.e. ₹ 1,17,84,500/- remained unexplained within the meaning of section 69A of the Act and was added to the total income. Aggrieved with the assessment order, the assessee preferred an appeal before the Ld. CIT(A), who, vide the impugned order, partly allowed the appeal as there was no compliance to the various notices issued for hearing. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal. 4. Rival submissions were heard and the record and the submissions made have been examined. 5. In the course of the appeal before us, the Ld. AR sought adjournment, which was refused. It was informed to the Ld. AR that before the Ld. AO as well as before the Ld. CIT(Appeals), no compliance was made to the various notices issued for hearing and the assessment order was made under section 144 of the Act and even the appeal was decided ex parte. Before us, along with the appeal memo, the assessee has filed the written Printed from counselvise.com 4 ITA No. 97/Pat/2025 Sunita Devi AY: 2017-18 submission, though it is addressed to the Income Tax Administrative Tribunal, Patna. It is mentioned that the notices issued by the Ld. AO were not complied with but when a show cause notice for penalty was received, the assessee submitted the reply along with certain documents. It was stated that the assessee had not received any previous notice and was not aware of or knowledgeable about the seriousness of the matter and had requested that the penalty under section 271(1)(b) of the Act may be dropped. In the appeal before the Ld. CIT(Appeals), the appeal was partly allowed and as the turnover of ₹4,22,81,711/- was found to be higher than the amount credited in the bank account at ₹4,05,35,287/-, the credits in bank were found favourable. It was stated before the Ld. CIT(A) that the cash deposited during the demonetisation period was from sale proceeds i.e. either from cash sales or from debtors for credit sales but as the assessee failed to submit any documents relating to the same, the addition u/s 69A was confirmed but relief was allowed on other grounds. The assessee has furnished the copy of sales register and cash book before us. However, since the same was not filed before the Ld. AO or before the Ld. CIT(Appeals), it was considered in the interest of justice and fair play that the matter may be remanded to the Ld. AO to examine the documents filed in support of the claim that the cash deposit was out of the sale proceeds/receipt of money from the debtors. Hence, the order of the Ld. CIT(A) is hereby set aside on the issue of cash deposit during the demonetisation period which is remanded to the Ld. AO for considering the documents filed by the assessee before us, which should also be filed before the Ld. AO, who shall grant an opportunity of being heard to the assessee and delete the addition if the submission is acceptable as once the turnover is accepted, there is no Printed from counselvise.com 5 ITA No. 97/Pat/2025 Sunita Devi AY: 2017-18 justification for making any separate addition under 69A for the cash deposited during the demonetisation period. 6. Since there was no proper compliance before both the Ld. AO as well as before the Ld. CIT(A), in the interest of justice and fair play it was considered by the Bench that the request of the assessee to remand the case before the Ld. AO may be allowed so that a proper opportunity of being heard may be provided. Hence, after examining the facts of the case, we deem it appropriate to set aside the order of the Ld. CIT(A) on the additions sustained and remit the matter back to the Ld. AO for making the reassessment de novo. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any further submission it wants to make in support of its grounds of appeal and shall not seek unnecessary adjournments. Accordingly, the ground taken by the assessee in her appeal are allowed for statistical purposes. 7. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 19th November, 2025. Sd/- Sd/- [Sonjoy Sarma] [Rakesh Mishra] Judicial Member Accountant Member Dated: 19.11.2025 Printed from counselvise.com 6 ITA No. 97/Pat/2025 Sunita Devi AY: 2017-18 Copy to: 1. Sunita Devi, Begma Ki Haveli, Khajekalan, Patna City - 800008 2. ITO, Ward 6(1), Patna 3. Pr. CIT/CIT 4. CIT(A) 5. DR, ITAT, Kolkata Bench, Kolkata //True Copy// By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata 1. Date of Dictation………………………………………. 2. Date on which the typed order is placed before the dictating Member and other Member…………………………………………….. 3. Date on which the order came back to Sr. PS…………………………………… 4. Date on which the file goes to the Bench Clerk………………………………… 5. Date on which the file goes to the O.S………………………………… 6. Date on dispatch of the order……………………………………… Printed from counselvise.com "