What did the Tribunal hold?

The Tribunal found that the RTGS transfers and the nature of paddy income required further verification. Therefore, the matter was remitted back to the AO for de-novo consideration to provide the assessee with another opportunity to be heard.

The assessee, engaged in grain and paddy trading, filed her return of income. During scrutiny, the AO observed unexplained deposits of Rs. 9 lakhs and discrepancies in paddy business amounting to Rs. 1,13,420/-. The AO passed an ex-parte order adding these amounts as income.

What were the issues?

Whether the AO was justified in passing an ex-parte order without providing the assessee with adequate opportunity to explain discrepancies in deposits and business income.

Amancharia Usha Rani, Nellore vs ITO | ITAT Hyderabad 2020

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI A. MOHAN ALANKAMONY

Hearing: 21/10/2019Pronounced: 13/01/2020

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “B-SMC”, HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER Assessment Year: 2014-15 Smt. Amancherla Usha Vs. Income Tax Officer, Rani, Ward-5, D. No. 27-11-141, Gowda Dargamitta, Hostel Centre, Balaji Nagar, Nellore Town. Nellore Town-524002. PAN: AGSPA 2283 M (Appellant) (Respondent) Assessee by: Sri V.V.S.C. Muralidhar Rao, Revenue by: Sri Nilanjan Dey, DR Date of hearing: 21/10/2019 Date of pronouncement: 13/01/2020 ORDER

This appeal is filed by the assessee against the order of the Ld. CIT(A), Tirupati in appeal No. 107/016-17/CIT(A)/TPT, dated 30/05/2018 passed U/s. 144 r.w.s 250(6) of the Act for the A.Y. 2014- 15.

The assessee has raised 5 grounds in her appeal however, the crux of the issue is that the Ld. CIT(A) is not justified in upholding the order of the Ld. A.O. passed U/s. 144 of the IT Act, 1961.

The brief facts of the case are that the assessee is an individual engaged in the business of trading in grains and paddy, filed her e- return of income on 17/3/2015 admitting total income of Rs. 4,03,100/-. Thereafter, the case was taken up for scrutiny. During the course of scrutiny assessment proceedings it was observed by the Ld. AO that the assessee had deposited Rs. 9 lakhs in her savings account. Further, there were certain discrepancies with respect to paddy business amounting to Rs. 1,13,420/-. Since neither the assessee nor her Counsel had explained the transaction before the Ld. AO and also failed to appear during the date of hearing, the Ld. AO passed ex-parte order by adding the amount of Rs. 9 lakhs and Rs. 1,13,420/- as the income of the assessee.

On appeal, the ld. CIT (A) confirmed the order of the Ld. AO because she could not disprove the finding of the ld. AO with cogent evidence.

At the outset, the Ld. AR submitted before us that the matter may be remitted back to the file of the Ld. AO in order to provide the assessee with one more opportunity of being hearing. The Ld. DR vehemently opposed to the submissions of the ld. AR.

I have heard rival submissions and carefully perused the materials on record. On perusing the order of the Ld. AO, it appears that there are some RTGS transfers of Rs. 9 lakhs which the assessee claims to have withdrawn and redeposited. Further the assessee has also claimed the income earned from sale of paddy as agricultural income which also needs verification as to whether the agricultural produce are from the assessee’s farm or the assessee is indulging in trading activities. Therefore, in the interest of justice, I hereby remit the matter back to the file of ld. AO for de-novo consideration thereby providing one more opportunity to the assessee of being heard before the Ld. Revenue Authorities.

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

Pronounced in the open Court on 13th January, 2020.

AMANCHARIA USHA RANI,NELLORE vs. INCOME TAX OFFICER, WARD-5, NELLORE

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