Case Law Details
Baiju Kabeer Vs ACIT (ITAT Cochin)
In the case Baiju Kabeer vs. ACIT (ITAT Cochin), the Income Tax Appellate Tribunal (ITAT) remanded the case back to the Commissioner of Income Tax (Appeals) [CIT(A)] for fresh assessment due to insufficient opportunity for the appellant to explain cash deposits. The issue arose from an income tax assessment for the year 2017-18. Baiju Kabeer had not filed his income tax return as required under Section 139 of the Income Tax Act, 1961. However, upon discovering cash deposits of ₹1,00,95,500 in his ICICI Bank account, the Assessing Officer (AO) initiated proceedings under Section 148 of the Act. The appellant subsequently declared an income of ₹7,74,559, but the AO revised this to ₹15,73,061, adding ₹9,13,501 as unexplained cash deposits under Section 69A. The CIT(A) later reduced this addition to ₹4,13,501 after considering the declared turnover.
Upon appeal, the ITAT observed that the appellant had not been given adequate opportunity to provide an explanation for the source of the cash deposits during proceedings with the CIT(A). The tribunal highlighted the importance of procedural fairness and directed the CIT(A) to conduct a de novo assessment. This fresh assessment is to be carried out after providing the appellant with a reasonable chance to present evidence supporting the cash deposits. The ITAT allowed the appeal for statistical purposes, ensuring the appellant’s arguments would be reconsidered in alignment with legal procedures.
FULL TEXT OF THE ORDER OF ITAT COCHIN
This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 07.06.2024 for Assessment Year (AY) 2017-18.
2. Brief facts of the case are that the appellant had not filed the return of income for AY 2017-18 under the provisions of section 139 of the Income Tax Act, 1961 (the Act). As per the information available with the department, the ACIT, Kollam (hereinafter called “the AO”) noticed that the appellant made cash deposit of Rs. 1,00,95,500/- with ICICI Bank. Therefore, a notice u/s. 148 of the Act was issued to the assessee on 30.03.2021. In response to the notice, the appellant filed return of income on 29.09.2021 declaring total income of Rs. 7,74,559/- being 8% of the total turnover of Rs. 96,81,999/-. Against the said return of income, the assessment was completed by the AO vide order dated 14.03.2022 passed u/s. 147 r.w.s. 144B of the Act at a total income of Rs. 15,73,061/-. While doing so, the AO made addition u/s. 69A of the Act of Rs. 9,13,501/- on cash deposit as unexplained money.
3. Being aggrieved, an appeal was filed before the CIT(A), who partly allowed the appeal, by granting relief to the appellant by restricting the addition to Rs. 4,13,501/-, being the difference of cash deposits in current account of Rs. 1,00,95,500/- and the turnover declared by the appellant at Rs. 96,81,999/-.
4. Being aggrieved, the appellant is in appeal before me in the present appeal.
5. I heard the rival contentions of both the parties and perused the material available on record. In view of the submission of the appellant that in the absence of reasonable opportunity to explain the source for cash deposit before the CIT(A), the matter be remanded to the file of the CIT(A) for de novo assessment in accordance with law after affording reasonable opportunity of hearing to the appellant.
6. In the result, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 21st January, 2025.
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