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Facts
The assessee challenged additions made by the Assessing Officer for unsecured loans and cash credits, which were confirmed by the CIT(A). The assessee attempted to settle the matter under the Direct Tax Vivad se Vishwas Act, 2020 (DTVSVA) but could not fulfill the payment conditions, leading the CIT(A) to dismiss the appeal without considering additional evidence filed by the assessee.
Held
The Tribunal acknowledged that the assessee was unable to avail DTVSVA benefits and that the additional evidence submitted to the CIT(A) was not adjudicated. Consequently, the matter was remanded to the CIT(A) for fresh adjudication, with directions to examine the additional evidence and issue a reasoned order after providing due opportunity of hearing.
Key Issues
Whether the CIT(A) erred in dismissing the assessee's appeal solely based on the unfulfilled DTVSVA settlement, without considering additional evidence, thereby denying a reasonable opportunity of hearing.
Sections Cited
250, 143(3), 143(1), 4(2) of DTVSVA, 5(1) of DTVSVA
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI ANIKESH BANERJEE & SHRI PRABHASH SHANKAR
O R D E R Per: Anikesh Banerjee (JM): Both the appeals of the assessee were filed against the order of the National Faceless Appeal Centre(NFAC), Delhi [hereinafter, ‘Ld.CIT(A)] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) for the Assessment Year 2013-14 and 2016-17, date of orders 25/06/2025 and 02/07/2025 respectively. The impugned orders were emanated from the orders of the Learned Assistant Commissioner of Income-tax- 24(1), Mumbai (in short, & 5142 /Mum/2025 Alpesh Narendra Shah ‘Ld.AO’) passed under section 143(3) of the Act, date of order 30/03/2016 for A.Y. 2013-14 and order passed by the Ld. Income-tax Officer 24(1)(1), Mumbai (in short, ‘Ld.AO’) passed under section 143(3) of the Act, date of order 29/12/2018 for A.Y. 2016-17.
Since both the appeals have identical facts and common issues, both the appeals were heard together and are being disposed of by this common order. is taken as lead case.
We have heard the rival submissions and perused the material available on record. The Ld. AR filed a paper book containing pages 1 to 65, which has been duly taken on record. The Ld. AR submitted that the assessee, an individual, filed the return of income for the relevant assessment year declaring total income of Rs.27,46,700/-. The return was processed under section 143(1) and subsequently selected for scrutiny under CASS. During the scrutiny proceedings, the Ld. AO noticed that the assessee had received unsecured loans amounting to Rs.1,35,77,021/- and cash credits amounting to Rs.2,07,57,087/-. The Ld. AO treated both the amounts as non-genuine and made additions accordingly. The assessee carried the matter in appeal before the Ld. CIT(A), who upheld the additions. At the appellate stage, the assessee opted for settlement under section 4(2) of the Direct Tax Vivad se Vishwas Act, 2020 (“DTVSVA”). Consequently, as per section 5(1), the appeal pending before the Ld. CIT(A) was deemed to be withdrawn upon issuance of Form 3 by the Designated Authority. However, the assessee was unable to pay the tax determined under DTVSVA and therefore & 5142 /Mum/2025 Alpesh Narendra Shah could not avail the benefit of settlement. The Ld. CIT(A), relying on section 4(2) of DTVSVA, dismissed the appeal, resulting in the assessed demand continuing to stand against the assessee. The assessee has now challenged the appellate order before the Tribunal.
The Ld. AR submitted that before opting for DTVSVA, the assessee had participated in the appellate proceedings and had filed additional evidence before the Ld. CIT(A). Such evidence comprising confirmations of accounts, bank statements, and documents relating to the loan creditors (placed at APB pages 7 to 36) which was not considered by the Ld. CIT(A). The Ld. AR drew our attention to APB pages 5 and 6, which demonstrate the filing of additional evidence before the first appellate authority. Therefore, the Ld. CIT(A) failed to adjudicate upon the additional evidence, resulting in denial of reasonable opportunity. The Ld. AR requested that the matter be restored to the file of the Ld. CIT(A) for de novo adjudication.
The Ld. DR supported the orders of the revenue authorities but did not raise any serious objection to the relief sought by the Ld. AR.
Upon careful consideration of the submissions and the material placed on record, we note that although the assessee had opted for settlement under the DTVSVA scheme, he could not fulfil the conditions necessary to obtain the benefit there under. It is further evident that the assessee had filed additional evidence before the Ld. CIT(A), copies of which are also placed before us in the paper book. We admit the said evidence, as it bears direct relevance to the additions made & 5142 /Mum/2025 Alpesh Narendra Shah and goes to the root of the matter. In the interest of justice, we therefore deem it appropriate to restore the matter to the file of the Ld. CIT(A) for fresh adjudication. The Ld. CIT(A) is directed to examine the additional evidence and pass a reasoned order after providing adequate opportunity of hearing to the assessee. We refrain from expressing any view on the merits of the additions so as not to prejudice the proceedings before the first appellate authority. The assessee is advised to extend full cooperation and diligently participate in the restored appellate proceedings. Accordingly, the appeal of the assessee is allowed for statistical purposes.
ITA 5142/Mum/2025 7. In view of the facts and circumstances being identical to appeal in which we have decided above, the decision arrived at therein shall apply mutatis mutandis to this appeal also.
In the result, both the appeals of the assessee bearing & 5142/Mum/2025 are allowed for statistical purpose.