FIRST CITIZEN TECHNOLOGIES LTD,NEW DELHI vs. ACIT, CIRCLE-9(1), NEW DELHI

These two appeals are filed by the assessee against the order dated 20.12.2018 and 06.12.2019 respectively of the Ld. Commissioner of Income Tax (Appeals)-3, New Delhi, and CIT (Appeals) Delhi-13, both for assessment year 2010-11.

I.T.A. No. 679/DEL/2019 :

“1. That on the facts and in the circumstances of the case and in law, learned CIT -A erred in affirming the order of Ld AO in TOTO.

2. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of deposit to the tune of (Rs.91,27,20,637) pertaining to other companies' bank accounts and on the basis of bank statements of other companies. It is pertinent here to mention that same type of more one bank account in the same bank of a customer is not possible. The assessee has obtained the details of the other companies whose deposit in their bank statements are wrongly added as income of the assessee by the Ld AO.

3. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of unexplained share application money of (Rs.2,70,04,261/-) u/s 68 of the Income Tax Act, 1961. The share

application money were accepted are genuine and as per law, the details of the same were produced earlier are available with the assessee and can be produced again when required.

4. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of increase in current liabilities of (Rs.2,20,50,778/-) u/s 68 of the Income Tax Act, 1961, however increase in current liabilities are genuine and due to increase in business in comparison to the previous year. The details of the same were supplied and can be produced once more, if required.

5. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of 20% of purchase i.e. (Rs.5,59,94,996/-) as unexplained amount, however all the purchase are genuine and related to the sales. The details of every purchase are available with the assessee and can be produced if required. It is explained earlier that business had increased.

6. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of 20% of administrative and other expenses i.e. (Rs.11,27,052/-) as unexplained amount. This was fully supported and increase in such expenditure was due to increase in business. The administrative and other expenses are genuine in nature and the details of the same are available with the assessee and can be produced if required.

7. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not adjudicating the specific grounds taken in appeal (Form No. 35) but merely reproduced in his order. The proper opportunity of being heard was not given to the assesse as the notice was not served properly to the assessee and also learned CIT-A did not consider the details produced by the AR of the assessee during the course of hearing of appeal.”

4. Aggrieved by the assessment order dated 27/12/2017, the assessee has preferred an appeal before the Ld.CIT (A). The Ld.CIT(A) has issued several notices, but the assessee failed to appear before the Ld.CIT(A) and failed put forth his case effectively. Therefore, the Ld.CIT(A) has dismissed the appeal on 30/01/2018 for non prosecution by relying on the ratio laid down in the case of CIT Vs. Multiplan Pvt. Ltd. Reported in 38 ITD 320 (Delhi).

7. We have heard the Ld. DR perused the material available on record and gave our thoughtful consideration. It is found that the Ld.CIT(A) had issued several notices to the assessee and gave sufficient opportunities to the assessee to put forth his case before the Ld.CIT(A), but even after providing sufficient opportunities neither the assessee nor the representative of the assessee have cooperated with the Ld.CIT(A) in the appellate proceedings. Further it is found that the Ld. CIT(A) has not decide the appeal merit and dismissed the appeal filed by the assessee for default by relying on the ratio laid down in the case of CIT Vs. Multiplan Pvt. Ltd. reported in 38 ITD (Delhi). The ratio relied by the CIT(A) is of Multiplan India Pvt. Ltd. (Supra) is no more a good law and it is settled position of law that the Revenue Authority and the even the Tribunal has to decide the appeal on merit and not suppose to dismiss the appeal for non prosecution without deciding the appeal on merit. Therefore, we deem it fit to remand the matter to the file of Ld.CIT(A) with a direction to decide the matter on merit. Accordingly, we direct the Ld.CIT(A) to decide the appeal on merit after giving opportunity of being heard to the assessee in accordance with law. Thus, we partly allow the Ground No.7 of the Assessee.

“1. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in affirming the order of Ld AO in TOTO, by applying the essence of the section 114(g) of the Indian Evidence Act on presumption basis, which is rebuttable. Presumption cannot be drawn from other presumption, and also a presumption is not an evidence or proof per se. However the fact is that the documentary evidences were acknowledged by the Ld CIT-A through e-proceeding vide ack. no. 19091911635352, vide Documents Id- ITBA/APLIS/ APL_1/2019-20/1017766876(1) dated 19-09-2019, but were ignored by the Ld CIT-A, and ordered in an unjust manner.

2. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of deposit to the tune of (Rs.91,27,20,637) pertaining to other companies' bank accounts and on the basis of bank statements of other companies. It is pertinent here to mention that same type of more than one bank account in the same bank of a customer cannot be maintained. The assessee

has obtained the details of the other companies whose deposit in their bank statements are wrongly added as income of the assessee by the Ld Assessing Officer.

3. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of unexplained share application money of (Rs.2,70,04,261) u/s 68 of the Income Tax Act, 1961. The share application money were accepted are genuine and as per law, the details of the same were produced earlier are available with the assessee and can be produced again when required.

5. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld AO on account of 20% of purchase i.e. (Rs.5,59,94,996) as unexplained amount, however all the purchase are genuine and related to the sales. The details of every purchase are available with the assessee and can be produced if required. It is explained earlier that business had increased.

6. That on the facts and in the circumstances of the case and in law, learned CIT-A erred in not deleting the addition made by Ld

AO on account of 20% of administrative & other expenses i.e. (Rs.11,27,052) as unexplained amount. This was fully supported and increase in such expenditure was due to increase in business. The administrative & other expenses are genuine in nature and the details of the same are available with the assessee and can be produced if required.

As per Ground No. 7 the assessee is aggrieved by the action of the Ld.CIT(A) in dismissing the appeal for non prosecution without affording opportunity of heard.

Order pronounced in the open court on : 14/02/2023.