TaxTMI 
TaxTMI 
2025 (1) TMI 162
X X X X Extracts X X X X
X X X X Extracts X X X X
....to add, alter or modify any ground of appeal." 2. Shri Ravi Agrawal, Ld. Authorized Representative (for short 'AR') for the assessee company, at the threshold of hearing of the appeal, submitted that there is a delay of 289 days involved in filing the present appeal. Elaborating on the reasons leading to the delay, the Ld. AR submitted that the same had occasioned for the reason that Shri Ashok Kumar Agrawal, director of the assessee company was suffering from a medical ailment and had undergone a kidney transplant for the second time on 29.03.2019 from KMCH, Coimbatore. The Ld. AR submitted that the entire family was disturbed due to the ill health of Shri Ashok Kumar Agrawal (supra) as his earlier kidney transplant had failed and he was to undergo another transplant. The Ld. AR submitted that as the other director of the assessee company, viz. Shri. Aayush Agrawal s/o. Shri. Ashok Kumar Agrawal, had remained engrossed in making arrangements for the treatment of his father and, thus, at the relevant point of time was unavailable in Raipur, therefore, for the said bonafide and compelling circumstances he had inadvertently omitted to carry within the prescribed time period th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....000 45,27,500 Total 12,21,000/- 1,09,55,500/- 6. The assessee at the fag end of the assessment proceedings, submitted before the AO that the cash deposits made in its bank accounts during the subject year were sourced out of the sale proceeds of its business of manufacturing and trading of aluminium sections and that of trading of tax free goods (flour). As the assessee company had tried to substantiate the source of the cash deposits of Rs. 12.96 lacs (sic) made in its bank accounts during the year under consideration by placing on record copy of the cash book and a cash flow statement, therefore, the A.O vide his notice u/s. 142(1) of the Act, dated 02.12.2019, inter alia, directed it to produce its books of accounts, purchase bills and sale bills etc. for the year under consideration and those of the immediately two preceding years. Also, the assessee was directed to file a "Chart" showing both the cash and credit purchases and sales for each month during the year under consideration as well as of the two immediately preceding years a/w. details as regards the opening cash balance and closing cash balance. Apart from that, the assessee company was directed to prod....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to whom cash sales were made did not inspire any confidence. The A.O based on his aforesaid observations held the cash deposits of Rs. 12.21 lac (sic) made during demonetization period in the bank accounts of the assessee company as unexplained cash credit u/s. 68 of the Act. Accordingly, the A.O vide his order passed u/s. 144 of the Act, dated 24.12.2019 determined the income of the assessee company at Rs. 19,63,131/-. 7. Aggrieved, the assessee company carried the matter in appeal before the CIT(Appeals) but without success. As the assessee company despite having been afforded 11 opportunities had failed to participate in the proceedings before the first appellate authority, therefore, the latter was constrained to proceed with and dispose of the appeal vide an ex-parte order. Accordingly, the CIT(Appeals) finding no infirmity in the view taken by the A.O approved the same by observing as under: "5.0 Decision and Reason The statement of facts, grounds of appeal and the order appealed against have been perused. 5.1 As mentioned in the earlier para, during these appellate proceedings eleven notices have been issued to the appellant from 21.01.2021 to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....me and repeated opportunities given as brought out in the foregoing paras. 5.4 From the above discussion it is evident that the appellant has no evidence to substantiate the grounds taken in the instant appeal and it has not even once argued with any supporting, relevant and cogent arguments/averments in support of the grounds of appeal. Therefore, there is no option left with me but to go through the extremely brief non-speaking description appearing in the grounds of appeal, statement of facts filed by the appellant and the order appealed against. 5.5 In the instant case, during the Appellate proceedings eleven hearing notices were issued from 21.01.2021 to 15.05.2023. However, the appellant had not responded to any of the eleven notices issued during the appellate proceedings. The appellant had also not complied to the hearing notice issued on 15.05.2023 within the prescribed date of 22.05.2023. However, vide letter dated 24.05.2023, the appellant has sought for adjournment without specifying any period of adjournment for "gathering of material from multiple sources". In view of the consistent non- compliance of notices issued during the appellate proceedings a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lete ignorance about the business of the company. He has also admitted that he has no purchase bills, Transport expenses bills etc. with him. Thus, during the assessment proceedings, the Assessing Officer had given ample opportunities to the appellant and on account of failure on the part of the appellant the AO had concluded that the cash deposited during demonetization period was unexplained and made addition of Rs. 12,21,000/- an unexplained cash deposit. 5.7.3 On the other hand, eleven hearing notices were issued to the appellant but the appellant did not comply to any of the eleven notices issued during the appellant proceedings. In view of the above and in absence of any cogent evidence/arguments from the appellant, I have no other option but to go along with the findings of the AO in the Assessment Order in respect of addition of Rs. 12,21,000/- on account of unexplained cash deposit. 5.7.4 Accordingly, second ground of appeal is dismissed. 5.8 The third ground of appeal is general in nature, thus it does not need separate adjudication. 5.9 Before parting, it is trite that an appellate authority is essentially called upon....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the year under consideration and that of the immediately two preceding years. The Ld. AR submitted that the A.O had not drawn any adverse inferences either as regards the books of accounts or the details filed by the assessee company before him, but had most arbitrarily without giving any cogent reason rejected its claim regarding the source of the cash deposits in its bank accounts in question. Carrying his contention further, the Ld. AR submitted that as the A.O while framing the assessment had determined /assessed the income of the assessee company by taking the "Net profit" of Rs. 7,42,131/- (as was disclosed in its audited books of account) as the base figure, therefore, he had accepted its books of accounts. The Ld. AR submitted that as the A.O had not rejected the books of accounts of the assessee company but rather had accepted the same, therefore, there was no justification on his part in rejecting the claim of the assessee company that the cash deposits made during the demonetization period in its bank accounts in question were sourced out of the accumulated savings that were available with it as on 08.11.2016 i.e before start of the demonetization period. The Ld.AR to bu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sales both for the year under consideration and that of the immediately two preceding years. Apart from that, the assessee to substantiate the authenticity of the purchase/sale transactions of tax free goods and taxable goods, had produced before the A.O the stock register. Nothing is discernible from the record which could prove that the assessee had failed to comply with the directions issued by the A.O vide notice u/s. 142(1) of the Act, dated 02.12.2019. In fact, I find that the A.O had observed in the assessment order that the assessee in compliance to his directions had produced before him books of accounts, purchase bills and vouchers a/w. purchase register. 13. As observed by me hereinabove, the A.O while framing the assessment vide his order u/s 144 of the Act, dated 24.12.2019 had not rejected the books of account of the assessee company. On the contrary, the AO by adopting the "Net profit" disclosed in the "Profit and loss account" of the assessee company as the base figure for determining/assessing its income at Rs. 19,63,131/- had accepted its "books results". As the AO had accepted the books of accounts of the assessee company, therefore, there could be no justific....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... that the cash deposits in its bank accounts during the demonetization period was sourced from the cash-in-hand available with him as on 08.11.2016 (supra). 15. As stated by the Ld.AR, and rightly so, the issue involved in the present appeal is squarely covered by the order of the ITAT, Raipur in the case of Rahul Cold Storage Vs. ITO, Ward-Dhamtari, ITA No.123/RPR/2022, dated 29.11.2022, wherein the Tribunal after necessary deliberations had held as under: "12. Having given a thoughtful consideration to the issue in hand, I find certain peculiar facts attending to the case of the present assessee before me. As observed hereinabove, it was the claim of the assessee that the cash deposits of Rs. 46.55 lacs (supra) made in its bank accounts during the demonetization period were sourced out of its business receipts, i.e., cold storage rentals that were duly recorded in its books of account. On the contrary, the A.O for the aforesaid reasons had rejected the claim of the assessee and had held the entire amount of Rs. 46.55 lacs (supra) as an unexplained cash credit u/s. 68 of the Act. Ostensibly, the A.O had though rejected the assessee's claim that the cash deposit of Rs. ....