PRIMARY AGRICULTURE CREDIT CO-OPERATIVE SOCIETY ANEGUNDI,ANEGUNDI, KOPPAL vs. INCOME TAX OFFICER WARD 1 KOPPAL, INCOMETAX OFFICE, WARD ONE, KOPPAL

ITA 2214/BANG/2026Status: DisposedITAT Bangalore28 September 2026AY 2017-186 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal condoned the delay of 665 days in filing the appeal, finding sufficient and bona fide cause due to the death of the assessee's Chartered Accountant, service of notices at an incorrect email address, and prompt action upon learning of the order. The Tribunal restored the entire matter to the file of the Assessing Officer (AO). The assessee is directed to furnish necessary details within 90 days. The AO is to decide afresh whether the cash deposit of ₹1,919,500 made during the demonetisation period represents funds received from members. If verification of KYC details supports the assessee's explanation, the addition shall be deleted. Otherwise, the AO may decide afresh after giving the assessee an opportunity of being heard. Ground No. 1 is allowed, and remaining grounds are dismissed as infructuous. The ratio is that procedural lapses by tax authorities or circumstances beyond the assessee's control leading to non-compliance should be considered for condonation of delay and restoration of proceedings, especially when principles of natural justice are violated.

What were the facts?

The assessee, Primary Agriculture Credit Co-operative Society, filed an appeal against the order of the Commissioner of Income Tax (Appeals)-8, Delhi, dated May 3, 2024. This order had dismissed the assessee's appeal against an assessment order dated December 25, 2019, passed by the Income Tax Officer, Ward-1, Koppal, under section 144 of the Income-tax Act, 1961, for assessment year 2017-18. The dismissal by the CIT(A) was for non-prosecution, as the assessee failed to respond to four notices. The original assessment order was passed ex-parte after the assessee failed to file a return and respond to notices issued under sections 142(1) and 144. The assessee's appeal to the ITAT was delayed by 665 days.

What were the issues?

1. Whether the learned CIT(A) erred in passing an ex-parte order dated May 3, 2024, without affording the Appellant a proper opportunity of being heard, specifically by sending notices to the email ID of a deceased Chartered Accountant instead of the correct email ID of the Society's staff, thereby violating the principles of natural justice (audi alteram partem)? 2. Whether the assessment order is invalid in law due to the non-issuance of a statutory notice under section 143(2) of the Income-tax Act, 1961, after a return was filed manually in response to a notice under section 142(1)? Assessee's Contentions: - The CIT(A) erred in dismissing the appeal for non-prosecution as notices were sent to an inaccessible email address of a deceased CA, violating natural justice. The correct email was provided. - The assessment order is void ab initio due to the non-issuance of a notice under section 143(2). - The addition of Rs. 19,15,500/- as unexplained cash credits under section 68 read with section 115BBE is illegal and unjustified, ignoring the nature of business and evidence. - Disallowances of Rs. 76,345/- for audit fee provision, investment write-off, loans & advances write-off, and sundry debtors write-off are erroneous and should be allowed under section 37. - The AO failed to consider details and evidence submitted, violating natural justice. - Bank deposit calculations were incorrect, leading to arbitrary additions. Revenue's Contentions: - The judgment records no specific contentions for the revenue regarding the grounds raised by the assessee.

Which sections of the Income-tax Act were involved?

Section 144,Section 142(1),Section 143(2),Section 68,Section 115BBE,Section 37,Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI PRASHANT MAHARISHI

PER SHRI PRASHANT MAHARISHI, VICE PRESIDENT

1.

The Assessee has filed this appeal against the order dated 3 May 2024 passed by the Commissioner of Income Tax (Appeals)-8, Delhi [learned CIT(A)] for assessment year 2017-18. By that order, the learned CIT(A) dismissed for non-prosecution the Assessee’s appeal against the order dated 25 Decemb

The order continues below.

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