Bilasraika Sponge Iron India Private Limited Vs ITO (ITAT Hyderabad)
Cash Seized by Police: ITAT Hyderabad Remands Section 68 Addition for Non-Consideration of Assessee’s Reply
The Hyderabad Bench of the ITAT set aside the addition of ₹30 lakh made under section 68 on account of cash seized by the police from the assessee company’s employees and remanded the matter to the Assessing Officer for fresh adjudication.
The Tribunal noted that although the AO recorded in the assessment order that the assessee had not filed any reply to the show-cause notice, the record clearly showed that the assessee had filed a detailed reply on 03.12.2019, along with a cash book and supporting documents, within the stipulated time. This reply was ignored while passing the assessment order, making the basis of the addition factually incorrect.
Given that the AO had specifically called for fund flow, cash book, bank statements and supporting evidence—and the assessee had responded—the ITAT held that the addition was made without considering material already on record, violating principles of fair adjudication. Consequently, the order of the CIT(A) was also set aside.
The matter was remanded to the AO with directions to re-examine the issue afresh after considering the assessee’s reply and evidence, and after granting a proper opportunity of hearing. The appeal was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
