IN THE INCOME-TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER &

SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील स.ं /ITA No.813/SRT/2024 Assessment Year: (2016-17)

(Hybrid hearing)

The ITO, Vs. Nita Ravi Khandelwal, Ward – 1(3)(1), 33, Pratistha Awas, Ghod Dod Road, Surat Surat – 395007, Gujarat èथायीलेखासं./जीआइआरसं./PAN/GIR No: AGSPS2820A (अपीलाथ(cid:334)/Appellant) ((cid:366)(cid:529)थ(cid:334) /Respondent)

Appellant by Shri Mukesh Jain, Sr. DR Respondent by Shri Jaikishan Goel, CA Date of Hearing 13/02/2025 Date of Pronouncement 29/04/2025 आदेश / O R D E R PER BIJAYANANDA PRUSETH, AM:

This appeal by the revenue emanates from order dated 12.06.2024 passed by the learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [in short, ‘CIT(A)’] for the assessment year (AY) 2016-17.

2. Grounds of appeal raised by the revenue are as under:

“i. On the facts and circumstances of the case and in law the Ld. CIT has erred in deleting the addition made of Rs.1,92,96,447/- by the AO on account of unexplained cash credit within the meaning of section 68 of the Act for not substantiating the opening capital as on 01.04.2016 along with supporting evidences, particularly when this closing balance as on 31.03.2015 was Nil.

ii. On the facts and circumstances of the case and in law the Ld. CIT has erred in deleting the addition made of Rs.24,68,904/- by the AO on account of unexplained cash credit within the meaning of section 68 of the Act for not substantiating the addition capital under various heads along with supporting evidences.

iii. On the facts and circumstances of the case and in law, the Ld. CIT(A) has violated the principles of natural justice while admitting the additional evidences and not providing opportunity of being heard to the Assessing Officer as per the provisions of section 250(2) of the Income tax Act, 1961 and Rule 46A(3) of the income tax Rules, 1962.

iv. On the facts and circumstances of the case and in law, the ld. CIT(A) has erred in admitting the additional evidences, which were not produced before the AO during the course of the assessment proceedings, without appreciating the fact that the assessee has not satisfied the basic conditions laid down under Rule

46A(1) of the Income tax Rules, 1962.

v. On the basis of the facts and circumstances of the case and in law, the Ld.

CIT(A) ought to have upheld the order of the Assessing Officer.

vi. It is therefore prayed that the order of Ld. CIT(A) may kindly be set aside that of the Assessing Officer be restored.

vii. The appellant craves leave to add, alter, amend and/or withdraw any ground of appeal either before or during the course of hearing of the appeal.”

3. Facts of the case in brief are that the assessee filed her return of income for the AY.2016-17 on 31.03.2017, declaring total income of Rs.3,80,820/-. The case was selected for limited scrutiny under CASS. The Assessing Officer (in short, ‘AO’) issued notices on 17.07.2018 and 13.11.2018 and requested to explain the each and every credit entry in her capital accounts. In reply to the notices, the assessee made her part compliance. As per balance sheet, AO noticed that there is closing capital balance of Rs.2,06,47,607/- as on 31.03.2016 and Rs. Nil as on 31.03.2015. Hence, there is increase of Rs.2,06,47,607/- in the capital of the assessee. As per the capital account for AY.2016-17, there is opening capital of Rs.1,92,96,447/- as on 01.04.2015 and closing capital of Rs.2,06,47,607/- as on 31.03.2016. The AO issued show cause notice dated 26.11.2018 and requested assessee to furnish details of opening capital and credit in capital account with supporting evidence. As the assessee failed to furnish explanation in respect of opening balance of Rs.1,92,96,447/-, the same remained unexplained and accordingly, the AO added the same to total income of the assessee as unexplained cash credit u/s 68 of the Act. He also added various small amounts and determined t