ITA No. 1183/Bang/2026

Parties Involved

Facts Summary

The assessee, Ms. Susheela, is a dealer in liquor who purchased the same from the Karnataka State Beverages Corporation. The collections received from the sale of liquor were deposited into the bank account and subsequently, the amount was transferred to the Karnataka State Beverages Corporation towards the purchase of liquor. The assessee had not filed her return of income even after the receipt of the notice u/s. 148 of the Act. The Assessing Officer (AO) based on the information that the assessee had made cash deposits and also based on the TCS statement, proposed to reopen the assessment u/s. 148 of the Act. The assessee had not furnished any details about the said deposits and the TCS statement. As per the TCS statement, the AO found the assessee had made payments to Karnataka State Beverages Corporation but was unable to explain the source for the said payment and treated the same as unexplained expenditure u/s. 69C of the Act. Similarly, the AO had also treated the cash deposits as unexplained money u/s. 69A of the Act since the assessee had not provided the sources of funds for the said cash deposits. The AO had made the ex-parte order u/s. 147 r.w.s. 144 of the Act. The assessee filed an appeal before the Commissioner of Income Tax (Appeals) (CIT(A)), but the appeal was dismissed on the ground that no supporting evidence, documents were furnished by the assessee. The assessee then filed an appeal before the Income Tax Appellate Tribunal (ITAT).…

Legal Issues

• 1. Whether the assessee is liable to pay the additional tax amount?
• 2. Whether the assessee should be given an opportunity to present her case?

Judgment Outcome

Decided in favour of Assessee.

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