TaxTMI 
TaxTMI 
2026 (5) TMI 887
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.... passed for A.Y. 2019-20. 2. The assessee has taken the following grounds of appeal: "1.0 The learned Commissioner of Income Tax (Appeals), NFAC has erred in law and on facts in passing the appellate order ex-parte, without ensuring that a real and meaningful opportunity of hearing was afforded to the appellant, especially considering the peculiar circumstances and genuine limitations faced by the appellant in effectively participating in the proceedings. 2.0 The learned Commissioner of Income Tax (Appeals), NFAC has erred in law and on facts in confirming the addition of Rs. 26,17,000/- on account of cash withdrawals from the bank account treating the same as undisclosed income made by invoking the provisions of sectio....
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....erest under section 234A, 234B and 234F of the Income Tax Act, 1961. 8. The appellant craves leave to add to, alter, delete or modify any of the above grounds of appeal either before or at the time of hearing of this appeal." 3. The brief facts of the case are that the assessee is a primary milk cooperative society engaged in collecting milk from village members and supplying the same to the District Milk Co-operative Union. The case was reopened under section 147 of the Act based on information received through the Insight Portal that the assessee had made cash withdrawals of Rs. 26,17,000/- and cash deposits of Rs. 73,000/- in its bank account during the relevant financial year and had also earned interest income of Rs. 10,107....
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....any compliance or furnish any submissions or evidence in support of its grounds of appeal. The CIT(Appeals) observed that adequate opportunities were granted to the assessee but no response was received and therefore inferred that the assessee had nothing to substantiate its case. In the absence of any rebuttal or supporting material from the assessee, the CIT(Appeals) upheld the action of the Assessing Officer in treating the cash withdrawals as unexplained expenditure and confirming the addition of interest income, and accordingly dismissed all the grounds of appeal. 5. The assessee is in appeal before us against the order passed by the CIT(Appeals) dismissing the appeal of the assessee. 6. We have heard the rival submissions and pe....
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....rough one individual. However, in our considered view, once the source of deposits in the bank account is accepted and not doubted, no addition can be made merely on account of cash withdrawals from such explained sources. The addition under section 69C of the Act cannot be sustained when the primary source of funds itself is not in dispute. 9. We find support from the decision of the Coordinate Bench of the Tribunal in the case of Timba Muvadi Dudh Mandali vs. ITO, ITA No. 1874/Ahd/2025 (A.Y. 2019-20), order dated 11.03.2026, wherein under identical facts it was held that where the milk co-operative society receives payments from the District Milk Union through banking channels and withdraws the same for distribution to its members, no ....