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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI SANDEEP SINGH KARHAIL
The present appeal has been filed by the assessee challenging the impugned order dated 13/09/2022, passed under section 250 of the Income Tax Act (‘the Act’) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [‘learned CIT(A)’], for the assessment year 2013-14.
In this appeal, the assessee has raised the following grounds:
“1. The Ld. CIT (A) erred in not giving opportunity of being heard, he is erred in ignoring the adjournment letter filed by the assessee. And alleging that the Shri Dharamraj Laxman Kurve ITA no.2801/Mum./2022 assessee intentionally not attended the hearing and failed to avail the opportunity of being heard.
2. The Ld. CIT (A) erred in law and on facts in confirming the addition made by the Ld.AO of Rs.65,39,250/- U/s.69A merely on the basis of AIR information,and without giving due consideration to the return filed by the assessee and Nature of the business, The Ld.AO and Ld.CIT (A) both have obliterated, the nature of the business of the assessee, which necessitates to collect cash (sale of recharge /talk time) and deposit in the bank so the payment to the service providers (telecom companies) can be made.
3. The Ld.CIT (A) erred in law and on facts in confirming addition U/s 69A, whereas these deposits were duly recorded in the books of the assessee including its source of receipts .Since the conditions mandated U/s.69A are not fulfilled, hence consequential addition become illegal and ultra virus of the provisions of the Act, which needs to be deleted 4 The Ld. CIT (A) erred in confirming the invocation of provisions of sec 115BBE of the Act, and charging consequential tax.”
The brief facts of the case as emanating from the record are: For the year under consideration, the assessee filed its return of income on 31/03/2015, declaring a total income of Rs. 4,30,015. The return filed by the assessee was selected for scrutiny and statutory notices under section 143(2) and section 142(1) along with a questionnaire, were issued to the assessee. During the assessment proceedings, the Assessing Officer (‘AO’) issued notice to the assessee to furnish the details. However, no compliance was made by the assessee. The AO also issued a show cause notice as to why a penalty under section 271(1)(b) of the Act be not levied for non-compliance with the notices, however, the same was also not complied with by the assessee and accordingly, order under section 271(1)(b) of the Act was passed on 29/01/2016, imposing a penalty of Rs.10,000, on the assessee for failure to comply with the notice issued under section 142(1) of the Act. However, even after the levy of the penalty, there was no compliance from the side of the assessee. Accordingly, the AO proceeded to compute the assessment ex-parte
Shri Dharamraj Laxman Kurve ITA no.2801/Mum./2022 under section 144 of the Act on the basis of material available on record. The AO vide order dated 07/03/2016, passed under section 143(3) r/w section 144 of the Act computed the total income of the assessee at Rs.69,69,300, after making the addition of Rs.65,39,250, under section 69A of the Act on account of cash deposited in the bank accounts of the assessee.
In the appeal before the learned CIT(A), despite various notices being issued, no reply/submission was filed on behalf of the assessee. Accordingly, vide impugned ex–parte order dated 13/09/2022, the learned CIT(A) dismissed the appeal filed by the assessee by upholding the addition made by the AO in the absence of any contradictory material being available on record. Being aggrieved, the assessee is in appeal before us.
During the hearing, the learned Authorised Representative (‘learned AR’) submitted that the assessee did not receive any of the notices issued by the AO, as the same was only uploaded on the portal of the Income Tax Department. As regards the notices issued by the learned CIT(A), the learned AR submitted that the notice dated 10/01/2021, was issued by the learned CIT(A) during the COVID pandemic period and therefore the same could not be attended by the assessee. The learned AR submitted that on 26/08/2022, the learned CIT(A) issued a notice and granted the time to the assessee to file written submission on or before 12/09/2022. In response thereto, the assessee on 12/09/2022, requested for an adjournment upto 27/09/2022, before the learned CIT(A). However, to its surprise, the learned CIT(A) passed the impugned order on the very next day i.e. 13/09/2022. Thus, it was Shri Dharamraj Laxman Kurve ITA no.2801/Mum./2022 submitted that no proper opportunity of hearing was granted to the assessee by the learned CIT(A) while disposing of the appeal.
On the contrary, the learned Departmental Representative submitted that the assessee did not comply with various notices issued by the AO during the assessment proceedings and the assessment in the case of the assessee was completed under section 144 of the Act.
We have considered the rival submissions and perused the material available on record. It is evident from the record that the learned CIT(A) has passed the order ex-parte due to the non-appearance of/on behalf of the assessee. From the perusal of the documents forming part of the paper book, we find that the learned CIT(A) vide notice dated 26/08/2022, directed the assessee to file its written submission on or before 12/09/2022. We further find that the said notice was duly responded to by the assessee and the request for adjournment of 15 days, i.e. up to 27/09/2022, was made on behalf of the assessee before the learned CIT(A) on the basis that the assessee is gathering material from multiple sources, which requires further time. However, we find that the learned CIT(A) without taking note of the adjournment requested by the assessee passed the impugned order dismissing the appeal filed by the assessee and upheld the addition made by the AO under section 69A of the Act. We also find that during the assessment proceedings, the assessee did not respond to various notices which are alleged to have been issued and served on the assessee. As per the assessee, the said notices were merely uploaded on the portal of the Income Tax Department. Now in appeal before us, the assessee is duly represented by the learned Page | 4
Shri Dharamraj Laxman Kurve ITA no.2801/Mum./2022 Authorised Representative and wishes to pursue the litigation against the addition made by the AO. In view of the above, we are of the considered opinion that in the interest of justice, the assessee be hereby granted one more opportunity to represent its case and furnish all the details in respect of the merits of the case. Consequently, we deem it fit and proper to restore the matter to the file of the AO for de novo adjudication after consideration of all the details/submissions as may be filed by the assessee. Needless to mention that no order shall be passed without affording reasonable opportunity of hearing to the assessee. Further, the assessee is also directed to fully cooperate with the AO in completing the assessment by furnishing all the details that may be called for. As the matter is being restored to the file of the AO for de novo adjudication, the other grievances raised by the assessee on merits do not call for adjudication at this stage. Accordingly, grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 17/01/2023
SSdd/- SSdd/- OM PRAKASH KANT SANDEEP SINGH KARHAIL ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 17/01/2023
Shri Dharamraj Laxman Kurve ITA no.2801/Mum./2022