SAYEEDABANU,BENGALURU vs. THE INCOME TAX OFFICER, WARD 3(2)(3), BENGALURU
What did the Tribunal hold?
The Tribunal held that the assessee was not given sufficient opportunity to furnish written submissions before the CIT(A) and therefore, the matter should be restored to the AO to provide one more opportunity.
What were the facts?
The assessee declared a low income and during demonetization made a cash deposit of Rs. 10,40,000/- which was added as unexplained money by the AO. The CIT(A) decided the appeal ex-parte as the assessee failed to file written submissions.
What were the issues?
Whether the CIT(A) erred in deciding the appeal ex-parte without granting sufficient opportunity to the assessee to present its case and evidence regarding the source of cash deposits.
Which sections of the Income-tax Act were involved?
Section 69A,Section 115BBE,Section 144,Section 142(1),Section 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC - A” BENCH : BANGALORE
Before: SHRI GEORGE GEORGE K
This appeal at the instance of the assessee is directed against CIT(A)’s order dated 28.08.2023, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2017-18.
Brief facts of the case are as follows:
Assessee is an individual. For the Assessment Year 2017-18, return of income was filed on 26.07.2017 declaring income of Rs.22,680/- under the head ‘income from other sources’. The assessment was selected for limited scrutiny to examine the cash deposit made during the demonetization period. In response to the notice issued under section 142(1) of the Act, assessee opted to e-proceedings and filed explanation to the same. The AO, however, rejected the contention of the assessee and passed Assessment Order under section 144 of the Act dated 13.11.2019. In the said Assessment Order, the AO added a sum of Rs.10,40,000/- as unexplained money under section 69A of the Act. The AO also applied special rate of taxation as per provisions of section 115BBE of the Act.
Aggrieved by the Order of the Assessment, assessee filed an appeal before the CIT(A). Since assessee did not file written submissions in response to the hearing notices and sought for adjournment, the appeal was decided ex-parte by the CIT(A) vide impugned order dated 28.08.2023.
Aggrieved by the order of the CIT(A), assessee has filed the present appeal before the Tribunal. The learned AR submitted that assessee had sold a property and was in receipt of cash amounting to Rs.11,90,000/- and same was utilized for making cash deposit during the demonetization period. It was submitted that assessee had to gather legible material evidence as well as translate certain documents from Kannada to English and therefore sought for adjournment of the case before the CIT(A). However, the CIT(A) closed the window to furnish the written submission. Hence, the case was decided ex-parte. It was contended that assessee was not given sufficient opportunity to furnish the written submission and prayed for the matter to be remanded to the AO.
The learned Standing Counsel supported the orders of the AO and the CIT(A).
I have heard the rival submissions and perused the material on record. The CIT(A) had issued four notices of hearing. To all the hearing notices except the last hearing notice, assessee had sought for adjournment. I am of the view that one more opportunity ought to be granted to the assessee to furnish necessary material as regards the source of cash deposits. Since the assessment has been completed under section 144 of the Act, I deem it appropriate to restore the matter to the files of the AO. It is ordered accordingly.
In the result, appeal filed by the assessee is allowed for statistical purposes.
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