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Facts
The assessee, engaged in trading, filed an appeal against orders confirming additions made for interest on unsecured loans and unaccounted sales. The assessee had not ensured compliance during the first appellate proceedings due to his father's illness.
Held
The Tribunal noted the non-compliance but considered the entirety of facts and the interest of justice. The Tribunal set aside the impugned orders and remitted the cases back to the CIT(A) for fresh adjudication.
Key Issues
Whether the CIT(A) orders should be set aside due to non-compliance by the assessee, and if the cases should be remanded for fresh adjudication.
Sections Cited
132, 153A, 89C, 69C, 115BB, 234A, 234B, 234C, 234D
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘A’: NEW DELHI
Before: SHRI CHALLA NAGENDRA PRASAD & SHRI AVDHESH KUMAR MISHRA
A.Y. 2021-22 Abhimanyu Jain Dy. Commissioner of Income B-2/69, Block B-2, Tax, Central Circle-31, Safdarjung Enclave, Vs. ARA Building, New Delhi Jhandewalan Extension PAN: AGNPA7628M New Delhi (Appellant) (Respondent) Appellant by Sh. Akash Ojha, Adv. & Ms. Krishna Rathore, Advocate Respondent by Shri Jitender Singh, CIT- DR Date of Hearing 04/08/2025 Date of Pronouncement 06/08/2025 ORDER PER AVDHESH KUMAR MISHRA, AM Common facts and similar grounds arise in the above captioned appeals of the assessee; therefore, these appeals were heard together and are being disposed off by this common order.
These appeals of the assessee for the Assessment Years (‘AYs’) 2018-19, 2019-20, 2020-21 & 2021-22 are directed against orders dated 29.08.2024 of the Commissioner of Income Tax (Appeals)-30, New Delhi [‘CIT(A)’]. We are to 4723/DEL/2024 Abhimanyu Jain taking the AY 2018-19 as a lead case for facts of the case only as the facts of other remaining cases are quite similar.
The assessee has raised following grounds of appeal: - “1. On the facts and circumstances of the case, the order passed by Ld. CIT(A) is bad both in eyes of law and on facts.
2. That the Ld. CIT(A) has erred in law and on facts by confirming the addition of Rs. 80,000/- made u/s 89C of the Income Tax Act, 1961 by the Ld. AO on account of alleged cash payments of interest of unsecured loans. 2.1. That the Ld. CIT(A) has erred in law and on facts in not considering that the additions made by the Ld. AO are without any reasonable basis. 2.2. That the Ld. CIT(A) has erred in law and on facts in ignoring the fact that the Ld. AO has merely relied upon 'Annexure A-8' of the seized material without explaining the basis of arriving at the said addition. 2.3. That the Ld. CIT(A) has erred in law and on facts by ignoring the fact that the Ld. AO has relied on a dumb document without any corroborative statement in order to make the impugned addition.
3. That the Ld. CIT(A) has erred in law and on facts by confirming the addition of Rs.6,77,870/- made by the Ld. AO as alleged profit on claimed unaccounted sales, despite the fact that sales had been duly recorded in the books of accounts.
4. That the Ld. CIT(A) has erred in law as well on facts in confirming the charging of interest under 234A, 234B, 234C and 234D of the Act.
5. That the appellant reserves the right to add, modify, alter, amend or delete any of the grounds.
4. The relevant facts giving rise to the Appeal; of the AY 2018-19 are that the assessee, engaged in the trading of cigars, lighters, cigarettes, papers, tobacco etc., filed his original Return of Income on to 4723/DEL/2024 Abhimanyu Jain 31.10.2018 declaring income of Rs.6,93,420/-. Later on, the assessee was searched under section 132 of the Income Tax Act, 1961 (‘Act’) on 06.01.2021 along with cases of the Hans Group. Thereafter, a notice under section 153A of the Act was issued to the assessee for filing the Income Tax Act (‘ITR’). The assessee filed his ITR in response to the said notice under section 153A of the Act on 01.02.2022. During the course of search operations, certain incriminating materials were seized which showed that the assessee had paid interest of Rs.80,000/- in cash on the unsecured loans taken by him. The said interest of Rs.80,000/- paid in cash was over and above the interest paid through the books of accounts. The said interest of Rs.80,000/- paid in cash was treated as unexplained expenditure and taxed accordingly under section 69C r.w.s. 115BB of the Act. Further, the seized material revealed that the assessee had done certain unaccounted sales as detailed in para 5.1 of the assessment order. The Assessing Officer (‘AO’) provided many opportunities of being heard to the assessee, which were not responded to as detailed in para 5.2 to 5.5 of the assessment order. Hence, the AO applied the net profit @ 15% of the unaccounted sales and added back the same to the returned income. Aggrieved, the assessee filed appeal before the Ld. CIT(A), who dismissed the appeal.
5. At the outset, Ld. Counsel for the assessee brought to our notice that the Ld. CIT(A) decided all the above mentioned four cases against the assessee by observing that the assessee has not pursued these appeals despite being granted several opportunities of being heard. Before us, the Ld. Counsel 3 to 4723/DEL/2024 Abhimanyu Jain submitted that the assessee failed to ensure compliance before the Ld. CIT(A) due to illness of his father. He filed various medical prescriptions, hospitalization details, etc. to justify non-compliances during the first appellate proceedings. He submitted that there were reasons for the assessee for not ensuring compliances before the first appellate authority. He prayed for remanding these cases back to the file of the Ld. CIT(A). To which, the Ld. CIT-DR seemed in agreement.
We have heard both parties and have perused the material available on the record. We take note of the fact that the appellant assessee has not ensured any compliance during the first appellate proceedings. However, the Ld. CIT(A) has adjudicated all these cases on merits. The Ld. CIT(A) has decided each ground of appeal
after discussing the issues in detail and his reasons for agreeing with the assessment orders. We have taken note of the fact that the impugned orders have been passed due to the consistent non- compliances on the part of the assessee in all cases. However, considering facts of these cases in entirety and in the interest of justice, we deem it fit to set aside all the impugned orders and remit all these cases back to the files of the Ld. CIT(A) for deciding these cases afresh. Ordered accordingly. We are refraining from making any comment on merit of any case. The appellant assessee, no doubt, shall cooperate in remitted appellate proceedings. Consequently, all the appeals are allowed for statistical purposes. to 4723/DEL/2024 Abhimanyu Jain
7. In the result, the assessee’s appeals captioned above are allowed for statistical purposes as above.
Order pronounced in open Court on 06 August, 2025.