Hemraj Prabhudas Chandel Vs ITO (ITAT Ahmedabad)
Assessee filed return declaring Rs.3,11,410/-. Case was selected for limited scrutiny to verify credit-card payments & demonetisation-period cash deposits. No compliance was made before AO despite eight opportunities, leading to best-judgment assessment u/s 144. AO added Rs.11,73,620 as unexplained cash expenditure towards credit-card payments u/s 69C & Rs.3,12,500 as unexplained cash deposit. Before Addl. CIT(A), assessee again made no appearance; however, the first appellate authority deleted the addition relating to cash deposit but sustained the Rs.11.73 lakh credit-card expenditure addition.
In second appeal, assessee explained delay of 435 days—frequent overseas travel as tour manager & reliance on previous counsel—supported by affidavit; delay was condoned. Assessee submitted that cash payments against the credit-card were sourced from cash withdrawals & some expenses were incurred for clients in the travel business. He sought one more opportunity to produce evidence.
Tribunal observed persistent non-compliance before both authorities, finding the explanation of “continuous travel” unconvincing. Once appeal was filed, it was assessee’s duty to track proceedings & ensure compliance; the blame cannot be shifted to counsel. Tribunal therefore imposed a cost of ₹5,000 to PMNRF as a condition. Subject to payment of cost, matter was remanded to the jurisdictional AO to allow the assessee one final opportunity to substantiate credit-card cash payments with proper evidence. AO may decide based on available records if assessee again defaults. Appeal allowed for statistical purposes.
