ANITA KANWAR,JAIPUR vs. INCOME TAX OFFICER WD 7(1), JAIPUR

This appeal by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals) [hereinafter referred to as “CIT(A)”] dated 05.08.2025 for the Assessment Year 2019-20, arising out of the assessment order dated 15.03.2024 passed by the Assessing Officer (hereinafter referred to as “the AO”) under section 147 r.w.s 144B of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).

There is a delay of 112 days in filing this appeal before us. The assessee has filed a condonation application supported by an affidavit explaining

The grounds of appeal raised by the assessee in the memorandum of appeal in Form No. 36 read as under: 1. The Ld. CIT(A) and AO has erred in law by passing the order ex-parte without providing an effective and reasonable opportunity of being heard before passing the order u/s 148A and 147 r.w.s. 144B, thereby violating the principles of natural justice. 2. That the learned AO has failed to appreciate that once income is declared under section 44AD, separate addition of business expenditure under section 69C is unjustified unless it is demonstrated that such expenditure is outside the books and unrelated to business. 3. The Ld. CIT(A) has erred in confirming the addition of Rs. 12,19,788/- u/s 69C of the Income Tax Act, treating the expenses incurred on imports of goods by the assessee as unexplained expenditure without appreciating that the payments were made through regular banking channels and the turnover was declared under section 44AD in the income tax return. 4. That the addition has been made merely on suspicion and for alleged non-submission of certain details, without bringing any 4 material evidence on record to establish that the expenditure was unexplained hence, the addition was made merely for the alleged non-submission of documents and not on substantive evidence 5. Initiation of penalty u/s 271AAC(1) consequential to addition u/s 69C is unjustified 6. That the Appellant craves leave to add, alter amend any of the ground of appeal before hearing.

Briefly stated, the facts of the case are that the assessee did not file the return of income for the year under consideration within the time allowed under section 139(1) of the Act. Since the assessee had made foreign remittances and imported goods, reassessment proceedings were initiated and a notice under section 148 of the Act was issued to the assessee on 24.03.2023. In response, the assessee filed the return of income on 31.03.2023 declaring total income of Rs. 1,42,690. During the reassessment proceedings, the AO issued a show cause notice proposing

Before us, the learned Authorised Representative (hereinafter referred to as “the AR”) submitted that the assessee may be granted one more opportunity to substantiate its case, and prayed that the matter may be restored to the file of the AO for a fresh assessment.

The learned Departmental Representative (hereinafter referred to as “the DR”) submitted that sufficient opportunity had already been granted and that the assessee had failed to cooperate.

We have heard both the parties and perused the material available on record. We note that the assessee, in her return of income filed in response to notice under section 148 of the Act, declared income from business amounting to Rs 1,42,685 in accordance with the provisions of section 44AD of the Act, on a total turnover of Rs 11,50,546. We also note from page number 9 of the assessment order that she has submitted statement of her current account with ICICI bank for the entire financial year 2018-19 i.e. from 01.04.2018 to 31.03.2019 and the same has been even a part of the assessment order. However, right below that very bank statement, the assessing officer has recorded that “The bank statement submitted by the assessee is also not complete and it is only till 24.10.2018”.

Further, it is evident that the assessee did not participate in the last part of the assessment proceedings, and also before the CIT(A), and the addition came to be made and confirmed for want of any response from the assessee. The assessee has not had an opportunity to be heard on the merits of the addition.

Keeping in view the totality of the facts and circumstances, and in the interest of substantial justice, we deem it appropriate to set aside the impugned order and restore the matter to the file of the AO with a direction to frame the assessment afresh on merits, in accordance with law, after affording a reasonable opportunity of being heard to the assessee. At the same time, we make it clear that: a) the assessee shall remain vigilant regarding the proceedings and shall cooperate and make timely representations before the AO without seeking unnecessary adjournments; b) in the event of any further default by the assessee, the AO shall be at liberty to complete the assessment in accordance with law on the basis of the material available on record; and c) we have not expressed any opinion on the merits of the addition, and all contentions of both the sides on merits are left open.

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