Case Law Details
Nagarajan Manivannan Vs ITO (ITAT Chennai)
Income Tax Appellate Tribunal (ITAT) Chennai has granted a fresh opportunity to Nagarajan Manivannan to substantiate the source of ₹54.70 lakh in cash deposits made during the demonetization period. The case pertains to the Assessment Year 2017-18, where the Assessing Officer (AO) had made an addition under Section 147 read with Section 144 of the Income Tax Act. The Commissioner of Income Tax (Appeals) [CIT(A)] confirmed the addition as the assessee failed to present any evidence despite multiple opportunities. Seeking relief, the assessee approached ITAT, requesting another chance to explain the cash deposits.
The ITAT acknowledged the assessee’s failure to provide supporting documents but, considering the principle of natural justice, allowed a reassessment. However, this opportunity is subject to the payment of ₹5,000 to the Tamil Nadu State Legal Services Authority. The assessee must furnish proof of payment to the AO, who will conduct a fresh assessment. The tribunal emphasized that the assessee must now provide complete documentation to substantiate his claims. The appeal was thus allowed for statistical purposes, ensuring due process in determining the legitimacy of the cash deposits.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 31-07-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s.147 r.w.s. 144 of the Act on 16-05-2023. The sole grievance of the assessee is confirmation of addition of Rs.54.70 Lacs which represent cash deposits in the bank accounts during demonetization period. The Ld. CIT(A) confirmed the same since the assessee failed to make any representation therein despite being provided with various opportunities of hearing. Aggrieved, the assessee is in further appeal before us. The Ld. AR has pleaded for another opportunity to the assessee to substantiate the same which has been opposed by Ld. Sr. DR.
2. Though the assessee has remained negligent in substantiating the source of cash deposit, however, accepting the plea of Ld. AR and keeping in mind the principle of natural justice, we deem it fit to grant another opportunity to the assessee to substantiate its case before lower authorities. The same would be subject to payment of cost of Rs.5,000/-which shall be deposited by the assessee within 30 days from the date of receipt of this order to ‘Tamil Nadu State Legal Services Authority’ at Hon’ble High Court of Madras. The proof of the same shall be furnished by the assessee to learned AO who shall proceed for de novo assessment. The assessee is directed to substantiate its case forthwith.
3. The appeal stand allowed for statistical purposes.
Order pronounced in open court on 09th December, 2024.
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