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Income Tax Appellate Tribunal, ALLAHABAD ‘SMC’ BENCH, ALLAHABAD
A.Y. 2011-12 Pankaj Kumar Choubey, vs. Income Tax Officer, Bhorsar, Amoi, Mirzapur 3(2), Mirzapur PAN:AAOFM6183C (Appellant) (Respondent) Assessee by: Sh. Praveen Godbole, C.A. Revenue by: Sh. A.K. Singh, Sr. DR Date of hearing: 18.09.2024 Date of pronouncement: 29.11.2024 O R D E R PER NIKHIL CHOUDHARY, A.M.: This is an appeal against the order of the ld. CIT(A), NFAC under section 250 of the Income Tax Act, 1961 dismissing the appeal of the assessee for want of compliance. The grounds of appeal preferred are as under:- “1- That in any view of the matter assessment order passed u/s 144/147 of the IT Act dated 06/12/2018 is bad both on the fact and in law and by such order income as determined at Rs.32,22,490/- by making illegal addition is highly unjustified and incorrect in the facts and circumstances of the case. 2- That any view of the matter the Ld CIT(A), NFAC was wrong in passing the order ex-parte without providing reasonable opportunity to the assessee and the order is also not a speaking order in the eyes of law. 3- That in any view of the matter notice u/s 148 of the IT Act dated 26/03/2018 as mentioned in the order was not served on the assessee or on any family member of the assessee, therefore the allegation of service of the notice in the order is incorrect.
4- That in any view of the matter it is also a fact that for issue of notice u/s 148 of the Act no reason were recorded nor supplied to the assessee before the framing assessment as such entire assessment is illegal and invalid hence liable to be declared void. 5- That in any view of the matter it is also fact that there was no service of the notice u/s 142(1) of the Act as alleged in the assessment order hence the entire assessment is illegal and bad in law and by such order Income as determined at Rs.32,22,490/- is not correct. 6- That in any view of the matter the addition of Rs. 32,22,490/- so made without appreciating the correct facts is incorrect in so for as the credit side of bank were from definite sources and while considering the deposit in bank account debit side was totally ignored as a result the addition made in arbitrary manner by the Assessing Officer and confirmed by CIT(A) NFAC is highly unjustified, incorrect and invalid. 7- That in any view of the matter that deposit of Rs. 32,22,490/- in bank is from definite sources hence the addition is uncalled for in the fact and circumstances of the case. 8- That in any view of the matter the interest charged under different section of the IT Act while calculation the tax is highly unjustified, illegal in the facts and circumstances of the case. 9- That in any view of the matter the appellant reserves his right to take any fresh ground before hearing of the appeal.”
The facts of the case are that the assessee made a cash deposit of Rs.32,22,490/- in savings bank account maintained with ICICI Bank Limited, Mirzapur during the F.Y. 2010-11. Upon receipt of this information, the ld. AO issued a notice under section 148. No compliance was made to the notice under section 148, therefore the ld. AO issued a notice under section 142(1) seeking certain details. Subsequently, in response, an unsigned letter was filed on behalf of the assessee and the ld. AO therefore, asked the assessee to attend the office and sign the letter filed in response to his notice. Furthermore, another notice under section 142(1) was issued seeking further details. No compliance was made to it either. Finally, the ld. AO issued a show a cause notice and served the same through speed 2 post at the address mentioned in the bank statement of the assessee. Once again there was no compliance to the same. In view of the above, the ld. AO completed the assessment at Rs.32,22,490/- and initiated penalty proceedings under section 271(1)(c).
Aggrieved with the said additions, the assessee filed an appeal before the ld. CIT(A). It was submitted that the assessee had not received any notice and therefore, was not able to make compliance till the date of service of assessment order. It was further submitted that the deposit was not unexplained but was from definite sources and while considering the bank statement, the ld. AO had only looked at the credit side but ignored the debit side, as a result of which the tax calculation was highly unjustified. The ld. CIT(A) records, that he provided as many as four opportunities to the assessee but the assessee did not make any compliance before him. Therefore, relying upon various Court decisions, he concluded that since the assessee had failed to substantiate that the deposited cash was from explained sources and not complied during appeal proceedings, the grounds were being dismissed.
Aggrieved with the said dismissal of his appeal, the assessee is before us. Shri. Praveen Godbole, C.A. (hereinafter referred to as the ‘ld. AR’) appeared before us and submitted that a return had been filed in compliance to the notice under section 148 declaring an income of Rs. 72,600/-, but no cognizance had been taken of the return that was filed and an ex parte assessment was framed. It was also submitted that the assessee had filed a reply to the notice under section 133(6) of the Act, which was not considered. It was submitted that the assessee was residing at a very remote place i.e. Bhorsar, Amoi, Rewa Road, N.H. 7, Mirzapur which was almost 80 Kilometers from Mirzapur Town and due to the remote location, the assessee could not receive the notices. He further submitted that since the assessee was not techno savvy, he was not able to make compliance before the NFAC, because he was simply not aware of the fixture of the appeal. It was, therefore, prayed that an opportunity may kindly be provided to the assessee to place the facts before the ld. AO so that he could establish that the deposits in the said bank account were explained.
On the other hand, Shri. A.K. Singh, Sr. DR (hereinafter referred to as the ‘ld. Sr. DR) submitted that the assessee had been non-compliant throughout and had not even stated any definite source of the deposits, in his written communications at the time of filing the appeal before the ld. CIT(A) or the ITAT. As such, he had no explanation to offer and the entire addition was covered under the provisions of section 69. Be that as it may, if the Tribunal was inclined to give the assessee one more opportunity to explain his case, then the ld. Sr. DR submitted that instruction should be issued to the assessee to make due compliance, failing which it had to be presumed that the assessee had no explanation to offer and the amounts were fit to be added in the hands of the assessee as unexplained investments.
We have duly considered the facts and circumstances of the case. It appears that due to the physical location of the assessee and the unfamiliarity with the Income Tax Portal, the assessee could not make compliance either before the ld. AO or before the NFAC. Therefore, he could not make submissions to explain the cash deposited in his account. The ld. AO has also not recorded any finding of fact regarding the nature and source of the deposit. After considering these facts, we feel it is in the interest of justice to both parties that the matter should be sent back to the file of the ld. AO for re-examination of the source of deposit. We hereby instruct the assessee to make full compliance before the ld. AO, to prove that the cash deposits made in his accounts were out explained sources and caution him that failure to do so, would lead to a presumption of the same being unexplained. As the