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Income Tax Appellate Tribunal, MUMBAI BENCH “F”, MUMBAI
Before: SHRI PRASHANT MAHARISHI & SHRI KULDIP SINGH
Per : Kuldip Singh, Judicial Member:
The appellant, Shri Vivek Vinod Sureka (hereinafter referred to as ‘the assessee’) by filing the present appeal, sought to set aside the impugned order dated 15.12.2022 passed by the National Faceless Appeal Centre(NFAC) [Commissioner of Income Tax (Appeals), Delhi] (hereinafter referred to as CIT(A)] qua the assessment year 2009-10 on the grounds inter-alia that :- “1) In the facts and the circumstances of the case and in law, the CIT[A]NFAC erred in Appellate order ex parte by issuing a) First notice on 09.01.2021 during covid 19 period which could not be attended as the Appellant was not aware of the same. b) Second notice on 2-12-2022 which was served by email which was never received or might have gone to spam folder.
2) In the facts and the circumstances of the case and in law, the learned A.O. erred in making disallowance of Rs.9,45,01,406/- in the nature of unexplained credit u/s 69 (instead of section 68) even though there is no such disallowance permitted u/s 69 of the IT Act.
Without prejudice to the above, 3) In the facts and the circumstances of the case and in law, the learned A.O. erred in passing the order u/s 143(3) r.w.s 147 and therefore rendering the whole re-assessment bad in law, that presumption and surmises and borrowed satisfaction.
1) In the facts and circumstances of the case and in law, the Assessing Officer erred in disallowing Rs.9,45,01,406/- in the nature of unexplained credit u/s 69 of the IT Act deposited in HSBC Bank by disregarding the affidavit.
4) In the facts and circumstances of the case and in law, the Assessing Officer erred in levying penalty u/s 271(1)(c) and also charged interest u/s 234A, BC & D.
5) In the facts and circumstances of the case and in law, the CIT[A] NFAC erred in passing ex-parte appellate order and dismissing appeal in hurry without adjudicating the grounds on merits and thereby causing severe breach of natural justice and without granting an adequate opportunity to the Appellant to present the case.
[B] Relief Prayed: The appellant therefore prays follows,
To Quash the Appellate order passed ex parte without adequate opportunity.
2. To quash the order for reopening the case u/s 143 r.w.s 147. 3. To delete the addition of Rs. 9,45,01,406/- in the nature of unexplained credit u/s 69 of the IT Act deposited in HSBC Bank. 4. To delete penalty levied u/s 271(1)(c) also charged interest u/s 234A, B C & D.
[D] General:- ⚫ The appellant reserve rights to add alter or delete any portion of this appeal before its conclusion. ⚫ A Detailed paper book along with case laws will be submitted at the time of hearing. ⚫This appeal has been filed on time and may please be allowed in full.”
Briefly stated facts necessary for consideration and adjudication of the issues at hand are : the return of income filed by the assessee declaring total income of Rs.2,23,780/- was processed under section 143(1) of the Income Tax Act, 1961 (for short ‘the Act’). Subsequently the assessment was reopened by recording reasons by initiating the proceedings under section 147/148 of the Act. After service of notice under section 148 of the Act necessary notices under section 142(1) & 143(2) were issued. The assessee appeared through his representative. However, despite the sufficient time given the assessee failed to furnish his explanation nor explained the source of deposit. Then notice under section 133(6) was issued to the Manager, Hong Kong and Shangai Bank Corporation Ltd. to provide the bank statement which they have supplied. Statement of the assessee was also recorded under section1 131 of the Act. On failure of the assessee to furnish any explanation about the nature of source of credits the Assessing Officer (AO) proceeded to make addition of Rs.9,45,01,406/- under section 69 of the Act and thereby framed the assessment under section 143(3) read with section 147 of the Act.
The assessee carried the matter before the Ld. CIT(A) by way of filing appeal who has dismissed the appeal. Feeling aggrieved with the impugned order passed by the Ld. CIT(A) the assessee has come up before the Tribunal by way of filing present appeal.
We have heard the Ld. Authorised Representatives of the parties to the appeal, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light of the facts and circumstances of the case and law applicable thereto.
At the very outset, it is brought to the notice of the Bench by the Ld. A.R. for the assessee that the impugned order has been passed by the Ld. CIT(A) at the back of the assessee as notice as alleged has never been received. This contention of the Ld. A.R. for the assessee has been vehemently opposed by the Ld. D.R. for the Revenue as notices dated 09.01.2021 and 02.12.2022 were issued to the assessee but no submissions were made by the assessee during the appellate proceedings.
We have perused the impugned order passed by the Ld. CIT(A) who has, no doubt recorded in para 4 of the impugned order that on 09.01.2021 and 02.12.2022 notices were issued to the assessee who had appeared through his representative but failed to file explanation. But in these circumstances Assessee should not be punished due to the fault of his A.R.
In these circumstances the Ld. CIT(A) was required to pass the order on merits but he has passed the order for want of prosecution by the assessee and thereby confirmed the addition made by the AO.
To impart the justice and to decide the issue once for all, to further stop the multiplicity of the proceedings and to provide adequate opportunity to the assessee, we are of the considered view that the impugned order is required to be set aside to the Ld. CIT(A) to decide afresh after providing opportunity of being heard to the assessee.
Resultantly, the appeal filed by the assessee is hereby allowed for statistical purposes.
Order pronounced in the open court on 28.02.2023.