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2020 (7) TMI 464 - AT - Income TaxAddition u/s 69A - addition of processing charges bill alleged to be paid outside the books of accounts - HELD THAT:- On receipt of reply alongwith 34 documents from M/s. Utkal Export, neither the AO or the CIT(A) show caused the assessee by way of written notice or note sheet entry and proceeded to make addition u/s.69A by treating the impugned amount of three bills and processing charges paid to the assessee in cash. This act of the revenue authorities is clearly contrary to the principles of natural justice as on receipt of reply from M/s. Utkal Export before making addition, the assessee should have been show caused informing him regarding reply received from M/s. Utkal Export and asking the assessee to reconcile the same. If the assessee fails to explain and reconcile the differential amount, the revenue authorities were well empowered to make addition in the hands of the assessee u/s.69A - no hesitation to hold that the addition has been made in clear violation of principles of natural justice and the ld CIT(A) was not justified and correct in upholding the same. Assessee should have been allowed to reconcile and explain the differential amount of all the bills and processing charges paid to the assessee in cash as per reply of M/s. Utkal Exports furnished before the AO. Issue related to additions made by the AO on both the issues required reverification by the AO after allowing opportunity of being heard to the assessee, thus both the issues are restored to the file of the Assessing Officer for limited purposes with the direction that the AO shall re-examine the bills and reply of M/s. Utkal Exports keeping in view stand and explanation of the assessee and redecide the issue after allowing reasonable opportunity of hearing to the assessee. Appeal of the assessee is allowed for statistical purposes.
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