RATHINAVELNADAR BAALAKRISHNAN,TIRUNELVELI vs. ITO WARD 1 TIRUNELVELI, TIRUNELVELI

Brief facts of the case are that the assessee is an individual and did not file his return of income for AY 2017-18. As per information available with the department, the AO found that the assessee has made cash deposits to the tune of Rs.11,06,500/- in two accounts maintained with Bank of India, Palayamkottai during demonetization period. The AO was issued statutory notices to the assessee for filing the return of income and by calling for details. The assessee chose to be silent and did not respond to any of the notices. Meanwhile, the AO issued notices u/s.133(6) of the Act and obtained the bank statement from Bank of India. On perusal of the bank statements, the AO found that the assessee has made cash deposits to the tune of Rs.8,56,000 in one account maintained in the name of R.B.N. Automobiles and amount of Rs.2,50,000/- was deposited in another account in the name of the assessee during demonetization period. Later, the assessee filed the return of income on 21.09.2019 for the A.Y.2017-18 which was treated as invalid and non-est by the AO due to the return of income filed after the stipulated period. Consequently, the AO completed the assessment by passing an exparte order u/s.144 of the

Aggrieved by the order of the AO, the assessee preferred an appeal before the ld.CIT(A) on 27.02.2020.

At the outset, we observed that ld.CIT(A) has provided five opportunities for the assessee to appear for hearings as detailed in paragraph 3 of the ld.CIT(A) order to support the appeal of the assessee. However, the assessee chose to be silent and did not respond to any of the notices and hence, the ld.CIT(A) dismissed the appeal filed by the assessee by confirming the order of the AO by passing an order dated 26.04.2024. Aggrieved by the order of the ld.CIT(A), the assessee preferred an appeal before us.

The ld.AR submitted that the ld.CIT(A) has passed order by dismissing the appeal filed by the assessee due to non-participation of the assessee in the appellate proceedings. Further, the ld.AR of the assessee stated that the assessee was suffering from the long-term physical impact and subsequent health complications following a severe COVID-19 infection and age-related infirmities and hence, the assessee could not participate in the assessment as well as appellate proceedings. In view of the above, the ld.AR prayed that the Tribunal may be pleased to set aside the order of ld.CIT(A) and remit the issues to the file of AO. Further, ld.AR assured the bench that the ld.AR will represent on behalf of the assessee before the AO to complete the assessment proceedings effectively.

Per contra, the ld.DR submitted that the assessee has been negligent in responding to the statutory notices and hence, prayed for confirming the order of the ld.CIT(A).

We have heard the rival parties and perused the material available on record and gone through the orders of the lower authorities. We note that the AO has passed an order by considering the information available with the department and the same has been confirmed by the ld.CIT(A) due to non- participation of the assessee. Since, the assessee has failed to participate before the AO as well as the first appellate authority, we levy the cost of Rs.2,000/- to be paid to State Legal Aid Authority, Hon’ble High Court of Madras within 30 days from the date of receipt of this order and the assessee shall satisfy the payment of cost before the authorities.

In view of the above and to meet the ends of justice we set aside the order of ld.CIT(A) and remit the matter back to the file of AO and direct the AO to denovo frame the assessment order in accordance with law, after providing reasonable opportunity to the assessee. Needless to say, the assessee to be diligent and file written submissions and relevant documents if advised so.

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