SUDHIR TANAJI JAMBHALE,KARVEER vs. ITO, KOLHAPUR

Briefly stated, the facts of the case are that the assessee is an individual. For AY 2016-17, the assessee had filed his original return of income on 27-06-2016, declaring total income of Rs. 1,85,490/-, after claiming deductions of Rs. 88,524/-. Based on search in Mumbai at M/s. Shri Renuka Mata Multi State Urban Co-operative Credit Society Ltd., the Ld. Assessing Officer (“AO”) found that the assessee had deposited unexplained cash/investment amounting to Rs. 56,61,700/- into his savings bank account maintained with M/s. Renuka Mata Multi State Urban Co-operative Credit Society Ltd. during the FY. 2015-16 relevant to AY. 2016-17. The case of the assessee was reopened u/s. 147 of the Act. Accordingly, notice u/s. 148A(b) of the Act was issued and served upon the assessee on 14-03-2023 followed by notice u/s. 148 of the Act, dt. 25-03- 2023. The assessee did not respond to the said notice(s). Thereafter, statutory notice u/s. 142(1) of the Act along with show cause notice was issued to the assessee to submit the information regarding aforesaid un- explained cash deposits/investment. However, assessee did not respond to the said notice also. Hence, in the absence of any details/documents furnished by the assessee and after calling for information from M/s. Renuka Mata Multi State Urban Co-operative Credit Society Ltd. u/s. 133(6) of the Act, the Ld.AO proceeded to complete assessment ex-parte thereby making an addition of Rs. 56,61,700/- deposited in bank account maintained with M/s. Renuka Mata Multi State Urban Co-operative Credit Society Ltd. during the FY. 2015-16 relevant to AY. 2016-17 as unexplained income of the assessee u/s. 69A of the Act, vide his order dt. 17-03-2024 passed u/s. 147 of the Act.

Aggrieved, the assessee filed appeal before the Ld.CIT(A)/NFAC, challenging the aforesaid addition. Despite service of notice(s) of hearing issued during the appellate proceedings, there was non-compliance which 3 resulted in ex-parte decision by the Ld.CIT(A)/NFAC, dismissing the appeal of the assessee for non-prosecution.

Aggrieved, the assessee is in appeal before the Tribunal raising the following grounds of appeal:

The Ld.AR submitted that non-compliance to the notice(s) issued by the Ld.CIT(A)/NFAC as well as Ld.AO was not intentional since the notice u/s. 148 of the Act and all subsequent statutory notices were issued and served electronically through the e-Portal, and since the assessee, being a small transport operator of limited literacy in electronic communications, had no regular access to the e-Portal and was unaware of the issuance of such notices, the assessee was unable to respond to the notices within the time stipulated. It was also submitted that the assessee, not being technology-savvy and not in the habit of checking e-mails or accessing the e-Portal, failed to see and respond to the notices issued by the Ld.CIT(A). The Ld.AR further submitted that the assessee has a strong case and, therefore, prayed that in the interest of justice, the assessee may be granted with one more opportunity to substantiate his claim before the Ld.CIT(A)/NFAC by filing the requisite explanation/details/documents.

The Ld.DR relied on the order of the Ld.CIT(A)/NFAC and submitted that since the assessee failed to make any submissions in spite of several opportunities granted, the Ld.CIT(A)/NFAC was completely justified in dismissing the appeal of the assessee.

We have heard the learned representatives of the parties and perused the material available on record. Admittedly, there was non- compliance to the notice(s) issued by the Ld.AO as well as the Ld.CIT(A)/NFAC which constrained them to pass ex-parte order(s) qua the assessee. We observe that the Ld.CIT(A)/NFAC, in the instant case, has passed the impugned order without himself going into the merits of the case due to absence of any documentary evidence filed by the assessee in support of his claim. The appellate order reveals that the Ld.CIT(A)/NFAC has applied the decision in the case of B.N. Bhattacharjee and Another [118 ITR 461] and dismissed the case of the assessee for non-prosecution. No doubt, the Ld.CIT(A)/NFAC may decide the appeal where the assessee does not prosecute his appeal in spite of several opportunities. Nonetheless, he has to adhere to legislative mandate enshrined in sub- section (6) of section 250 of the Act, which requires him to state the points for determination, the decision thereon and the reasons for the decision. Thus, in our view, his order is in violation of the provisions of section 250(6) of the Act.

On the facts and in the circumstances of the case enumerated above, we are of the opinion that in the interest of justice, the matter deserves to be sent back to the file of the Ld.CIT(A)/NFAC for adjudicating the assessee‟s appeal before him afresh, on merits. Accordingly, the impugned order of the Ld.CIT(A)/NFAC is set aside and the matter is restored to his file for adjudication afresh on merits and as per fact and law, after allowing reasonable opportunity of hearing to the parties.

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes.

The concerned Pr.CIT, Pune

DR, ITAT, „B‟ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, ////