DEEPAK SINGHAL,NEW DELHI vs. ITO WARD - 63(3), NEW DELHI

This appeal filed by the assessee is directed against the order dated 11.02.2019 passed by ld. CIT(A)-38, New Delhi for the assessment year 2010-11 on the following grounds : “1. That on the facts and circumstances of the case, the appellate order passed by the Ld. CIT(A) is bad both in the eyes of law and on facts.

2. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred both in fact and in law in not taking up for adjudication the ground raised by the appellant that the approval granted by the authority u/s 151 of the Act, for re-opening of assessment proceedings u/s 147 of the Act, is not valid and is bad in law.

3. That on the facts and circumstances of the case, the Ld. CIT(A) erred in law in holding the reopening of the assessment proceedings u/s 147 of the Act as valid, which is bad in law and nullity being notice u/s 148 of the Act is served upon the assessee is barred by limitation.

4. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred in ignoring the fact that assessment order passed u/s 147/ 143(3) of the Act is without jurisdiction, is bad in law and a nullity being no mandatory notice u/s 143(2) have been issued by the AO which is sine qua non for assumption of jurisdiction to assess the case u/s 147 of the Act.

5. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred in ignoring the fact that order passed by the Ld. AO under section 147 / 143(3) instead of best judgment assessment under section 144 of the Act, in absence of any information furnished by the appellant, is contrary to facts and is bad in law.

6. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred in ignoring the fact that the AO arbitrarily estimated returned income of the appellant at Rs 1,60,000/- for the assessment year under consideration without there being any basis.

7. That on the facts and in the circumstances of the case, the Ld. CIT(A), erred both on facts and in law in upholding the arbitrary addition of Rs 5,26,259/- by the AO on account of unexplained source of cash used for credit card payments without considering the credit card statement received in response to notice issued u/s 133(6) to ICICI Bank which clearly shows that credit card bill was paid through cheque i.e. banking channel and not by cash.

8. That on the facts and in the circumstances of the case, the Ld. CIT(A), erred both on facts and in law in mechanically upholding said addition without making proper enquiry from the respective banks when the alleged credit card payment have been made through proper banking channel.

2. A notice through speed post acknowledgement due was sent to the appellant on 07.02.2022, which has been returned un-served with a remark ‘no such person is available on the given address”. Notice has been issued to the appellant/assessee on the address 2121/2, Veer Gali, Sadar Bazar, New Delhi, Delhi -110006 and the same address has been mentioned in the assessment order as well as Form 36 by the assessee in the column of ‘complete address for sending notices’. As per judgment of Hon’ble Supreme Court in the case of PCIT vs. M/s. I Ven Interactive Ltd. dated 18.10.2019 in Civil Appeal No. 8132 of 2019, in absence of any specific information to the Assessing Officer with respect to change of address and/or change of the name of assessee, Assessing Officer would be justified in sending the notices at the available address mentioned in the PAN database of the assessee. Respectfully following the same, we hold that when the assessee has filed return mentioning a particular address as per his PAN database, which has also been noted by the Assessing Officer as well as by the assessee himself in Form No. 36 as complete address for sending the notices and the assessee is not found available on the same address and no information about change of address to the Assessing Officer by the assessee, then we safely presume that all possible efforts have been made regarding service of notice on the assessee on the address given in PAN data and by assessee and assessee is not available, then we have no alternate but to proceed ex parte qua assessee to decide this appeal after hearing the submissions of ld. Sr. Departmental Representative (DR).

3. Learned Sr. DR, drawing our attention towards relevant part of the assessment order, submitted that in spite of repeated opportunities, the assessee had not offered any explanation to explain the source of the credit bill payments of Rs.5,26,259/-. Therefore, the Assessing Officer was right in making addition in the hands of the assessee treating such credit bill payments as unexplained expenses over and above the normal tax exemption level available to the assessee. Ld. Sr. DR also drew our attention towards para 4.1 of the first appellate order and submitted that after considering the reply of the assessee, ld. CIT(A) rightly held that the source of credit bill payments have not been explained and no explanation has been offered about the source of cash coming into the credit card. Ld. DR submitted that the assessee has explained where the money was spent, but no submission was made as to wherefrom the money came to him for payment of credit card. Therefore, the addition made by the Assessing Officer and confirmed by the ld. CIT(A) may kindly be upheld.

4. From para-3 of the first appellate order, we observe that the assessee has filed submissions before the ld. CIT(A), but there was no explanation regarding the source of cash against the payment to credit card. Therefore, I am of the considered opinion that the Assessing Officer was right in making addition in the hands of assessee and the ld. CIT(A) after considering the explanation of the assessee, was also correct in confirming the addition made by the Assessing Officer. Therefore, the appeal of the assessee, being devoid of merits, is dismissed.