GURUPADMARAJ SAUHARDA SAHAKARI NIYAMITA SINDAGI,VIJAYAPURA vs. INCOME TAX OFFICER, WARD 3, VIJAYAPURA

This appeal at the instance of the assessee is directed against CIT(A)’s order dated 14.09.2023, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2017-18.

Assessee is a co-operative society. For the Assessment Year 2017-18, assessee did not file any return of income. The AO noticed that assessee had made cash deposits in old currency notes of Rs.500/- and Rs.1000/- during the demonetization period amounting to Rs.31,55,500/-. The AO directed the assessee to file return of income. There was no response to the various notices issued under section 142(1) of the Act. Hence, the AO finally fixed the hearing on 13.09.2019 proposing to pass best judgment assessment under section 144 of the Act. Since there was no response to the same, assessment was completed under section 144 of the Act vide order dated 21.11.2019 and the entire cash deposit of Rs.31,55,500/- was brought to tax as per provisions of section 69A r.w.s. 115BBE of the Act.

Aggrieved by the assessment completed under section 144 of the Act, assessee preferred appeal before the First Appellate Authority (FAA). The CIT(A) passed an ex-parte order since there was no written submission filed in response to the several notices issued from the Office of the FAA.

Aggrieved by the order of the CIT(A), assessee has filed the present appeal before the Tribunal. The learned AR submitted that the case was represented by one ITP before AO and since he did not respond to the notice issued to him, the assessment was completed under section 144 of the Act. The same ITP had represented the case of assessee before CIT(A) and since he had failed to respond to the hearing notices, the said ITP was changed. It was submitted that new ITP had represented before the CIT(A) and had sought for adjournment of the case. It was submitted that without receipt of the adjournment applications, the FAA had disposed off the appeal ex-parte. The learned AR submitted that in the interest of justice and equity, one more opportunity may be granted to the assessee to represent its case.

The learned Standing Counsel submitted that assessee has been nonchalant and never responded to the notices issued from the Office of the AO and the CIT(A). Therefore, the learned Standing Counsel submitted that the appeal of the assessee may be dismissed.

We have heard the rival submissions and perused the material on record. Before the FAA to the several notices issued, there was no response from the assessee’s side. For three notices issued from the Office of the FAA, the AR had sought for adjournment. Since there was no written submission filed on the part of the assessee, the CIT(A) passed ex-parte order. We strongly deprecate the nonchalant attitude of the assessee in not filing the written submissions on time. However, in the interest of justice and equity, we are of the view that assessee ought to be provided with one more opportunity to present its case. The learned AR had represented before the Tribunal that he shall see to it that assessee shall co-operate with the Revenue and shall not seek unnecessary adjournment. Taking note of such an undertaking, we remand the matter to the files of the AO since the Assessment Order has been completed under section 144 of the Act.

In the result, appeal filed by the assessee is allowed for statistical purposes.