VISWANATHAN PRABHAVATHI,SALEM V. THE INCOME TAX OFFICER, WARD 1(8), SALEM, SALEM

ITA 927/CHNY/2025

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The case involves Viswanathan Prabhavathi, a dealer in prepaid vouchers and SIM cards, who appealed against the order of the Learned Commissioner of Income Tax, Appeal, Addl./JCIT(A)-1, Mumbai. The appeal arose from an assessment order passed by the A.O under section 144 of the Income-tax Act, 1961, which added a cash deposit of Rs 1,33,80,000 to the assessee's income, as the assessee failed to provide satisfactory evidence regarding the source of the deposit. The Tribunal found that the assessee had submitted additional evidence explaining the source of the cash deposit as business receipts from sales during the demonetization period, which was not admitted by the Ld. Addl. CIT(A). The Tribunal decided to give the assessee another opportunity to substantiate his case before the A.O.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712237 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOUTHAMI MANIVASAGAM
• Assessee Lawyers: S. ANANDH
• Keywords: Set aside; Business income; Additional evidence; Principle of natural justice
• Section: 147; 144

Judgement Text

" आयकर अपीलीय अिधकरण, ‘बी’ \u0011ा यपीठ, चे\u0016ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: CHENNAI \u0019ी एबी टी. वक , \u0011ा ियक सद! एवं \u0019ी जगदीश, लेखा सद! क े सम( BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.927/Chny/2025 िनधा9रण वष9 /Assessment Year: 2017-18 Viswanathan Prabhavathi, 12, Fitter Man Quarters, Mettur Dam, Mettur, Salem – 636 401. Vs. The Income Tax Officer, Ward-1(8), Salem. [PAN: BFIPP 3408K] (अपीलाथ\u0007/Appellant) (\b यथ\u0007/Respondent) अपीलाथ की ओर से/ Appellant by : Shri S. Anandh, Advocate HIथ की ओर से /Respondent by : Ms. Gouthami manivasagam, JCIT सुनवाई की तारीख/Date of Hearing : 18.06.2025 घोषणा की तारीख /Date of Pronouncement : 30.07.2025 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee for Assessment Year (AY) 2017-18 arises out of the order of Learned Commissioner of Income Tax, Appeal, Addl./JCIT(A)-1, Mumbai [hereinafter “CIT(A)”] dated 23.01.2025 in the matter of assessment framed by the Assessing Officer [AO] u/s. 144 of the Income-tax Act,1961 (hereinafter “the Act”) on 12.12.2019. Printed from counselvise.com ITA No.927/Chny/2025 Viswanathan Prabhavathi :- 2 -: 2. The assessee was a dealer in prepaid vouchers and SIM cards, and has made cash deposit of Rs 1,33,80,000/- in the bank account. The A.O in the order passed u/s 147 of the Act has made the addition of cash deposit as assessee has not responded to notices issued and submitted proper documentary evidence for source of cash deposit. 3. The Ld. Authorized Representative (A.R) of the assessee, at the outset has submitted that assessee was a dealer in prepaid vouchers and SIM cards and the Government had permitted the collection of Specified Bank Notes (SBNs) towards the sale of prepaid mobile top- ups during demonetization period. The Ld. A.R further submitted that assessee has filed additional evidence in support of cash deposit before the Ld. Addl. CIT(A), but he has not admitted the additional evidence and confirmed the addition. The Ld AR, therefore, prayed that one more opportunity may be granted to substantiate his case before the A.O. 4. On the other hand, the Ld. Departmental Representative (D.R) relied on the orders of the lower authorities and submitted that the lower authorities have passed ex-parte, as the assessee failed to Printed from counselvise.com ITA No.927/Chny/2025 Viswanathan Prabhavathi :- 3 -: produce documentary evidence to explain the cash deposits made during the demonetization period. 5. We have heard the rival submissions and perused the materials available on record. The A.O has made the addition of cash deposit of Rs.1,33,80,000/- as assessee has not explained the source of cash deposit. The assessee has submitted additional evidences in support of cash deposit explaining source of cash deposit as business receipt from prepaid vouchers and SIM cards sales. The Ld. Addl. CIT(A) has not admitted the additional evidence and dismissed the appeal. We are of the view that the assessee should be given one more opportunity to substantiate his case before the A.O in the interest of justice and in accordance with the principles of natural justice. Accordingly, we set aside the order of the Ld. Addl. CIT(A) and remit the matter back to the file of the A.O to verify the source of cash deposits in accordance with law. We also direct the assessee to appear before the A.O on the date of hearing without fail and furnish all relevant details for fresh consideration. Printed from counselvise.com ITA No.927/Chny/2025 Viswanathan Prabhavathi :- 4 -: 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 30th day of July, 2025 at Chennai. Sd/- Sd/- (एबी टी. वक ) (ABY. T. Varkey) \u0011ाियक सद! / Judicial Member (जगदीश) (Jagadish) लेखा सद! /Accountant Member चे\u0010नई/Chennai, \u0013दनांक/Dated: 30th July, 2025. EDN/- आदेश क\u0016 \bितिल\u0019प अ\u001aे\u0019षत/Copy to: 1. अपीलाथ\b/Appellant 2. थ\b/Respondent 3. आयकर आयु\u0010/CIT, Salem 4. िवभागीय ितिनिध/DR 5. गाड\u0019 फाईल/GF Printed from counselvise.com "