Tribunal Upholds Rs. 54.5 Lakh Addition as Unexplained Cash Credit; No Evidence Found for Double Taxation or Legitimate Sources.

The Tribunal dismissed the assessee's appeal, affirming the Ld. CIT(A)'s decision to uphold the addition of Rs. 54,50,000 as unexplained cash credit under section 68 of the Income-tax Act. The Tribunal found no procedural unfairness despite the lack of personal hearing, and no evidence supported the claims of double taxation or legitimate cash sources.

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Issues:
1. Lack of personal hearing provided by the National Faceless Appeal Centre (NFAC), CIT (Appeals), Mumbai.
2. Addition of Rs. 54,50,000 as unexplained cash credit under section 68 of the Income-tax Act.
3. Double taxation due to sustaining the addition of cash deposits during demonetization period.

Issue 1: Lack of Personal Hearing
The appeal was filed by the assessee against the order passed by the Ld. Commissioner of Income-tax (Appeals) at the National Faceless Appeal Centre, Mumbai, for the assessment year 2017-18. The primary contention was the absence of a personal hearing provided to the appellant, which was deemed a violation of the principles of Natural Justice. The appellant argued that the order was passed under section 250 of the Act without granting an opportunity for a personal hearing, thereby challenging the procedural fairness of the decision-making process.

Issue 2: Addition of Unexplained Cash Credit
The case involved a cash deposit of Rs. 54,50,000 made by the assessee during the demonetization period, which was treated as unexplained cash credit under section 68 of the Income-tax Act. The assessee claimed that the cash was generated from donations received from trusts against which deductions were claimed under sections 35AC and 35AC (ii) of the Act. However, the Assessing Officer rejected this explanation, citing the lack of documentary evidence to substantiate the claim. The addition was made following the decision of the Bombay High Court in a relevant case.

Issue 3: Double Taxation Concern
Another aspect of the case was the contention of double taxation raised by the assessee regarding the cash deposits made during the demonetization period. The assessee argued that the amount had already been assessed to tax in previous assessment years, leading to the possibility of double taxation. However, the authorities upheld the addition, emphasizing the lack of evidence supporting the claim that the cash received back from trusts was deposited during the demonetization period.

The Assessing Officer and the Ld. CIT(A) both rejected the explanations provided by the assessee regarding the source of the cash deposit, emphasizing the lack of supporting evidence and the circumstantial implausibility of the claims made. The Ld. CIT(A) relied on the decision of the Supreme Court in a relevant case to uphold the addition. Despite the absence of the assessee during the appeal proceedings, the Tribunal examined the material on record and affirmed the decision of the Ld. CIT(A), dismissing the appeal. The Tribunal found no infirmity in the order of the Ld. CIT(A) concerning the disputed cash deposit issue, leading to the dismissal of the assessee's appeal.

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