SWEETMITA ROYCHOUDHURY,KOLKATA V. ITO, WARD-4(3), KOLKATA

ITA 774/KOL/2024

AI Insights

This case involves an appeal by Sweetmita Roychoudhury against the order of the Commissioner of Income-tax (Appeals)-12, Mumbai, which confirmed an addition of \\u20b91,31,71,180 to the assessee's income for the Assessment Year 2017-18. The addition was initially made by the AO on account of purchases deemed in violation of Section 40A(3) of the Income Tax Act, which restricts certain cash payments. The assessee contended that the payments were made in installments, each not exceeding \\u20b920,000, and thus not in violation of the said section. The CIT(A) dismissed the appeal without addressing this argument, relying instead on the admission made by the assessee's counsel during the AO's proceedings. The Tribunal found merit in the assessee's request for a de novo adjudication, highlighting the need to consider the evidences of installment payments.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 126288 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MADHUMITA DAS
• Assessee Lawyers: AMIT AGRAWAL; CHIRAG THORIA; ARS
• Keywords: Set aside; Violation of Section 40A(3); Dismissed; Commissioner; Statistical purposes; Purchases; Restored; Admission
• Section: 40A(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM ITA No.774/KOL/2024 (Assessment Year:2017-18) Sweetmita Roychoudhury E/619, Baghajatin, Kolkata, West Bengal, 700086 Vs. ITO, Ward-4(3) Aayakar Bhawan Dakshin 2, Gariahat Road, Kolkata, West Bengal, 700069 (Appellant) (Respondent) PAN No. AAECA5539M Assessee by : Shri Amit Agrawal, Adv & Shri Chirag Thoria, Ars Revenue by : Shri Madhumita Das, DR Date of hearing: 16.04.2025 Date of pronouncement : 21.04.2025 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals)-12, Mumbai (hereinafter referred to as the “Ld. CIT(A)”] dated 13.02.2024 for the AY 2017-18. 02. The only issue raised by the assessee is against the confirmation of addition of ₹1,31,71,180/- by the ld. CIT (A) as made by the ld. AO on account of purchases made in violation of Section 40A(3) of the Act. The ld. Counsel for the assessee at the outset pointed out that the addition has been made by the ld. AO mainly on the basis of admission by the counsel of the assessee in the show cause notice whereas as a matter of fact all these payments were made in part which were not in violation of Provisions as contained in Section 40A(3) of the Act. Page | 2 ITA No.774/KOL/2024 Sweetmita RoyChoudhury; A.Y. 2017-18 03. In the appellate proceedings, the assessee submitted before the ld. CIT (A) that these purchases were paid in installments, however, the ld. CIT (A) dismissed the appeal without giving any finding on this issue merely relying on the admission of the counsel of the assessee before the ld. Assessing Officer. The ld. Counsel for the assessee submitted that the appeal may be restored to the file of the ld. AO for denovo adjudication after looking into the evidences which the assessee has filed evidencing the fact that the payments not exceeding ₹20,000/-. 04. The ld. DR on the other hand stated that these evidences were not produced before the ld. Assessing Officer. 05. After hearing the rival contentions and perusing the materials available on record, I find that in the interest of justice and fair play the assessee’s appeal needs to be restored to the file of the ld. AO for denovo adjudication after examining the evidences which the assessee may produce in the set aside proceeding, as the assessee cannot be punished for the admission of the Counsel of the assessee. Taking into account all these evidences, I restore this appeal to the file of the ld. AO with a direction to decide the same denovo after affording reasonable opportunity of hearing to the assessee. 06. In the result, the appeal of the assessee is partly allowed for statistical purposes Order pronounced in the open court on 21.04.2025. Sd/- (RAJESH KUMAR) (ACCOUNTANT MEMBER) Kolkata, Dated:21.04.2025 Sudip Sarkar, Sr.PS Page | 3 ITA No.774/KOL/2024 Sweetmita RoyChoudhury; A.Y. 2017-18 Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "