AVNISH KUMAR GUPTA,SIDHI vs. INCOME TAX OFFICER WARD-2, REWA, REWA

Per Sanjay Arora, AM The captioned appeals by the Assessee agitate the confirmation of his assessment under section 143(3) read with sec. 147 of the Income Tax Act, 1961 (‘the Act’ hereinafter) and the levy of penalty u/s. 271(1)(c) by the Commissioner of Income Tax (Appeals), National Faceless Appeals Center, Delhi (‘CIT(A)’ for short) for assessment year (AY) 2009-10 vide his separate orders of even date (i.e., 22.09.2021). 2.1 Explaining the assessee’s case, Shri Purohit, the ld. Sr. Counsel, would submit that an ex parte assessment stands made in the instant case on 28.11.2016 even as the non-response by the assessee before assessing authority, being ITO, Ward-II, Rewa, was on account of non-receipt of the notice u/s. 148(1) dated 29.3.2016 as well as the subsequent notices u/s. 143(2) and 142(1).

ITA Nos. 54&56 /Jab/2021(AY 2009-10) Avnish Kumar Gupta v. ITO Be that as it may, the appeal was filed, though belatedly (by 37 days), before the first appellate authority on the assessee becoming aware of an assessment in his case having been made. The delay was condoned, and considering the fact of non-representation before the Assessing Officer (AO), with the assessee furnishing a paper-book (containing 79 pages), including written submissions, before him on 02/01/2020 (PB pg. 2), a remand report was sought by the ld. CIT(A) from the AO on 02/01/2020 itself (PB pg. 1). And who, vide his communication dated 05.02.2020 extended an opportunity to the assessee to explain his case before him on 07.02.2020 (PB pg. 24). The assessee could not respond thereto as he did not receive any e-mail. No remand report was in any case submitted by him and which position obtains to date. The ld. CIT(A) passed the impugned order on 22.9.2021 without as much as referring to the calling of the remand report, much less considering it, or, given the fact of its non-furnishing by the AO, discussing the contents of the assessee’s paper-book furnished before him, and which included the assessee’s written submissions as well. Though he states of non-response to the notice of hearing dated 25.8.2021, the same, for 16.9.2021, was responded to by seeking adjournment (for 01.10.2021) on 16.9.2021 (PB pg. 25), which appears to have escaped his attention, inferring that the assessee had nothing to say in the matter. The impugned order thus confirms the assessment principally on the ground of non- substantiation of his case by the assessee before the first appellate authority, which, as apparent, is a travesty of justice considering that the entire amount deposited (Rs. 47.32 lacs) in the assessee’s Axis Bank account during the year belongs to another. The matter may therefore be remanded back, preferably to the file of the AO inasmuch as he had passed an ex parte order. Reliance for the purpose was placed by him on the decision in Prince Rai v. ITO (ITA No. 145/Jbp/ 2018, dated 22/7/2021) 2.2 Shri Halder, the ld. Sr. DR, would submit that multiple opportunities for representation were given to the assessee by both the Revenue Authorities, 2

ITA Nos. 54&56 /Jab/2021(AY 2009-10) Avnish Kumar Gupta v. ITO which were not availed by him, constraining them to pass ex parte orders, which are otherwise on the merits of the case, and cannot be regarded as a summary dismissal. He could not however answer the query by the Bench as to what explains the non-consideration of the assessee’s case on merits, i.e., upon considering the paper-book (including written submissions) dated 28.12.2019 submitted to the Office of the ld. CIT(A) on 02.01.2020. 4. I have heard the parties, and perused the material on record. 4.1 The assessee has before me, though so stated, not shown the alleged non- receipt of notices under sections 148(1), 143(2) or 142(1) issued by the AO, or even the notices of hearing by the ld. CIT(A). Further, the very fact of production of communication dated 5-2-2020 from the AO is proof enough of receipt thereof. There is also no claim of non-receipt of notices of hearing dated 07-01-2021 and 25-8-2021 issued by the ld. CIT(A) calling for written submissions by 13-01-21 and 16-9-2021 respectively. The address mentioned in all the orders and notices is also the same. Adjournment, it needs to be borne in mind, is in any case not a matter of right, but of discretion, to be though exercised judicially by the authority concerned. The ld. CIT(A) is therefore not wrong in stating that the assessee has failed to substantiate his case before him, holding as:

‘7.4 The claim of the appellant regarding the money deposited in his joint account with his brother was not admitted by him at the time of assessment proceedings. Vide notice dated 25/08/2021, the appellant was specifically given an opportunity to file documents in support of the claim that the money deposited was belonging to the brother. He was also asked to explain why the claim that it belonged to his brother should be admitted at appellate stage when no such claim was made at the assessment stage. The appellant has not made any reply till date even though sufficient opportunity has been given for the same.’ 4.2 The fact of the matter, however, is that, condoning the delay, the assesee’s appeal stands admitted, and the remand report called for by the ld. CIT(A) from the AO (PB pg. 24). Though there is nothing on record to exhibit 3

ITA Nos. 54&56 /Jab/2021(AY 2009-10) Avnish Kumar Gupta v. ITO the admission of the assessee’s paper-book by the first appellate authority, the very fact of remand and calling upon the assessee to substantiate his case before him by the AO, implies so. It is, rather, indicative of the first appellate authority being convinced of the assessee having a prima facie case, and of the same having not been properly considered, for whatever reasons, on merits. It is therefore surprising that there is no reference to either the calling of the remand report in its’ order, or of its non-receipt from the AO – for whatever reasons, as well as the non-consideration of the assessee’s claim, toward which a 79 page paper-book has been filed, defeating thus the very purpose for which the appeal was admitted, i.e., to meet the ends of justice. There is even no finding qua the primary facts, i.e., as to whether the cash deposited in the bank account is a joint account of assessee and his brother, Anuj Gupta, to whom the money deposited is stated to belong. It is only the consideration thereof, including the reason/s for acceptance or, as the case may be, non-acceptance, of the assessee’s case, that would meet the mandate of s. 250(4) r.w.s. 250(6) of the Act. 4.3 In the conspectus of the case, accepting the plea raised by Sh. Purohit, i.e., in principle, the matter is set aside to be file of the ld. CIT(A) for a decision on merits, by considering each of the assessee’s contentions on merits as per law and after allowing him a reasonable opportunity of being heard and, further, within the time frame, if any, under law. Needless to add, the remand report, stated to be pending as on date, shall be called forthwith, and duly considered. The assessee shall fully cooperate in the said proceedings, furnishing afresh also his latest email id as well as the physical address for communication, both to the assessing and the first appellate authority. A non-cooperative attitude on his part, shall, again, needless to add, attract an adverse inference, as admissible under law. The issue of levy of penalty u/s. 271(1)(c), for which no separate case stands out made by the assessee, so that it is the same as that for quantum, would also be decided by, similarly, considering the material on record and,

ITA Nos. 54&56 /Jab/2021(AY 2009-10) Avnish Kumar Gupta v. ITO further, providing a fair opportunity thereto to state his case. I decide accordingly. 5. In the result, the assessee’s appeals are allowed for statistical purposes. Order pronounced in the open Court on March 09th, 2022

Sd/- (Sanjay Arora) Accountant Member Date: 09/03/2022 Aks/- Copy of the Order forwarded to: 1. The Appellant: Sh. Avnish Kumar Gupta, Village Kotaha, Madwas Road, Sidhi (M.P.) 2. The Respondent: Income Tax Officer Ward-2, Rewa (M.P.) 3. The CIT(Appeals)-2, Jabalpur 4. The Senior DR, ITAT, Jabalpur 5. Guard File