Cash Deposits during demonetization: ITAT remands matter to consider Evidence [Read Order]

The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) remanded a matter back to the Commissioner of Income Tax (Appeals) [CIT(A)] to consider evidence in a case involving cash deposits during the demonetization period.

Aryavysya Seva Sangham, (assessee) an Association of Persons (AOP), was taken up for scrutiny based on data analytics under "Operation Clean Money." The Assessing Officer (AO) found that the assessee had made substantial cash deposits amounting to Rs. 40,43,330/- in bank accounts during the demonetization.

The assessee did not file return of income and therefore the AO issued notice to file return of income. The assessee failed to furnish return of income and therefore the AO completed the assessment by assessing total income of Rs. 34,66,350 as unexplained money under Section 69A of the Income Tax Act, 1961.

GST Simplified in Question & Answer Format Click here

Read More: PCIT Revision Order: ITAT Rules Assessment Order not erroneous, Rules Unexplained Money matter Properly Verified [Read Order]

Aggrieved by the assessment order, the assessee filed an appeal before the CIT(A). The CIT(A) provided partial relief to the assessee and sustained the addition of Rs. 33,34,200. Aggrieved by the CIT(A)’s order the assessee filed an appeal before the ITAT.

The counsel for the assessee submitted that several documents were filed but the CIT(A) passed an ex parte order. The counsel prayed for restoration of the matter to CIT(A) to substantiate the claim by filing evidence.

On the other hand, the counsel for revenue supported the orders of the lower authorities, contending that the assessee failed to explain the source of cash deposits or produce valid books of account.

Tax Planning – Practical Aspects Click here

The two-member bench comprising Laliet Kumar (Judicial Member) and Manjunatha G. (Accountant Member) observed that the CIT(A) had disposed of the appeal without considering the evidence filed by the assessee.

Read More: AO adds Rs. 30 crore as Unexplained Investment: ITAT restores matter in Interest of Justice with Penalty [Read Order]

The Tribunal held that the one more opportunity must be given to the assessee and therefore, the issue must be restored to the CIT(A). 

The tribunal set aside the order of the CIT(A) and restored the matter for fresh adjudication and directed the CIT(A) to consider all evidence on record. The Tribunal also directed the CIT(A) to grant an opportunity of being heard.

The appeal was allowed for statistical purposes.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates