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Facts
The assessee failed to file a return of income. The AO reopened the case under Section 148 and added unexplained cash deposits of Rs. 45,70,000 and undisclosed interest income of Rs. 9,00,934. The CIT(A) dismissed the appeal for non-prosecution.
Held
The Tribunal noted that the assessee was unable to respond to notices due to illness and lack of technological knowledge. The Tribunal remanded the case back to the Assessing Officer to decide the issues afresh after giving the assessee an adequate opportunity of being heard.
Key Issues
Whether the CIT(A) rightly dismissed the appeal for non-prosecution, and whether the assessee should be granted another opportunity to present their case before the AO.
Sections Cited
144, 147, 148, 142(1), 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “E”, NEW DELHI
This appeal has been filed by the Assessee against the order dated 29.11.2023 passed by the NFAC, Delhi on the following grounds:-
1. That the order passed by the Ld. CIT(A) dated 29.11.2023 dismissing the appeal of the assessee company as not maintainable, as per the provisions of Section 144/147 of the Act is erroneous and bad in law an on facts.
2. That the Ld. CIT(A) has erred in law and on facts by dismissing the appeal of the assessee and thereby upholding the impugned assessment order dated 27.11.2019 without appreciating that the impugned assessment order is without jurisdiction, bad in law and deserves to be quashed since it was passed under section 144/147. Without appreciating the factual position as the Term deposits as pointed out to have been made was in fact the renewal of the FDR having been obtained in the earlier year. The assessee in question has filled a appeal with the Hon’ble CIT for the deposit of the cash of Rs. 45.70 lac and other source of income Rs. 9 lac for AY 2012-13 which has been decided against the assessee vide the order of the ld. CIT(A) vide order dated 29.11.2023. The assessee was not able to respond to the notices, as, he is not conversant with the technology and the consultation attending the affairs of the assessee did not him from that. The rule of the natural justice requires that he be given the opportunity.
3. The assessee in question has deposited the amount of Rs. 45.70 lacs on account of the receipt of the sale of agricultural land. This is evidenced by the copy of document evidencing the receipt of Rs. 37.50 lacs the balance amount was on account of the accumulate saving of part amounting to Rs. 820000/-. Further, an addition of Rs. 900934/- has been made as account of the interest income as undisclosed there is no undisclosed income of Rs. 900934/-. The amount in question has been taken without any basis, on the basis of unsubstantiated facts by the AO. The factual position is that in the 26AS, the amount of interest reflected is Rs. 450468/- whereas in the order giving reference to the 26AS the amount of interest has been mentioned as Rs. 900934/-, which is factually incorrect and hence need to be quashed and set aside.
Brief facts of the case are that assessee is an individual had failed to file return of income. AO has received credible information through AIR module regarding deposit of cash during the year in the bank account of the assessee. Thus, the case of the assesee was reopened u/s. 148 of the Act by issuing a notice dated 30.03.2019. Later, notice u/s. 142(1) of the Act was issued on 22.06.2019. As no return was filed even after that, scrutiny u/s. 144 r.w.s. 147 of the Act was completed on 27.11.2019 adding back the unexplained cash deposits of Rs. 45,70,000/- in the bank account u/s. 69A of the Act. Further, in 2 | P a g e the absence of compliance and related evidences, undisclosed interest income of Rs. 9,00,934/- as per 26AS was also added back. Upon assessee’s appeal, CIT(A) noted the non-compliance of the assessee and dismissed the appeal for non-prosecution.
Against the aforesaid order, assessee is in appeal before us.
Ld. AR for the assessee prayed that due to illness of the assessee, proper representation could not be made before the authorities below. He prayed that one more opportunity may be given to the assessee to canvass the case properly before the AO. He also undertook that he will now represent the case diligently before the AO. Per contra, Ld. DR did not controvert the aforesaid proposition of the Ld. AR. Accordingly, in the interest of justice, we remit back the issues in dispute to the file of the Assessing Officer with the directions to decide the same afresh, after giving adequate opportunity of being heard to the assessee.