Awez Wahab Shaikh Vs ITO (ITAT Pune)
Assessee to Prove Deposits from Sales – Non-Speaking Section 144 Order Quashed – Tribunal Upholds Natural Justice
Assessee, engaged in business of trading mobile phones & accessories under the name M/s Royal Mobile Shoppy, challenged order of CIT(A)/NFAC dated 21.02.2025 confirming addition of ₹13,46,800 u/s 69A towards unexplained cash deposits.
AO noted that cash of ₹13.46 lakh was deposited during demonetisation period in Bandhan Bank & since the Assessee had not filed a valid return u/s 139 within due time, AO treated return filed on 12.07.2019 as invalid & passed best judgment assessment u/s 144. AO ignored the Tax Audit Report filed with return & held that deposits were unexplained, assessing total income at ₹18,66,520.
Before CIT(A), Assessee contended that notice u/s 142(1) was wrongly delivered to old tax counsel’s email, leading to non-communication. It was submitted that books were audited, Tax Audit Report filed, & deposits were from sales of mobiles & accessories. It was also shown that in AY 2018-19, AO had accepted cash deposits as explained business receipts. Despite this, CIT(A) upheld AO’s addition.
Tribunal found merit in Assessee’s contention that non-compliance was due to miscommunication, not deliberate. Since audited accounts & tax audit report showed deposits as business sales, the matter required fresh examination. Tribunal remitted issue back to Jurisdictional AO for de novo adjudication with direction to give reasonable opportunity to Assessee to produce audit report, purchase & sales bills, & other evidences. Assessee was directed to update email & remain vigilant in proceedings. Accordingly, the impugned order was set aside & appeal allowed for statistical purposes.
