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Facts
The appellant filed an appeal against additions made by the AO concerning cash deposits of Rs. 2 lakhs and Rs. 2.82 lakhs paid as LIC premium. The CIT(A) sustained these additions due to the appellant's non-appearance.
Held
The Tribunal condoned a delay of nine days in filing the appeal. It held that the CIT(A) should not dismiss an appeal based solely on non-appearance without adjudicating the merits. One more opportunity is granted to the appellant to explain the sources of additions.
Key Issues
Whether the CIT(A) erred in dismissing the appeal on grounds of non-appearance without deciding the merits of the additions made by the AO.
Sections Cited
69A
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Income Tax Appellate Tribunal, Mumbai “H(SMC
Before: Smt. Beena Pillai (JM) & Shri Omkareshwar Chidara (AM)
Per Omkareshwar Chidara (AM) :- The above captioned case, the appellant filed an appeal and raised grounds relating to cash deposits of Rs. 2 lakhs and also making an addition of Rs. 2.82 lakhs being cash paid to LIC as premium.
These two additions were made by the Ld. AO under section 69A of the I.T. Act without considering the conditions precedent to invoke the said section, it was stated that these grounds of appeal are reproduced for clarity.
1. 3. From the order of Ld. CIT(A), it is observed that five opportunities were given to the appellant. When the case was posted for hearing at para 4.0, Ld. CIT(A) held that since no submissions were made by the appellant, additions made by the Ld. AO were sustained.
During the hearing before the ITAT, Ld. AR of the appellant has stated that there is a small delay of nine days for filing the appeal and the same was condoned. Ld. AR has argued that there are certain personal problem relating to aged parents and due to preoccupancy of Chartered Accountant with regard to audit and income tax returns, replies could not be filed before
2 Naresh Atmaram Talreja Ld. CIT(A) and never there was any intention not to comply with the notices of Income Tax Department. Ld. AR has argued that the appellant is having some cash available with her and she has kept the same to take care of her old parents who are always under medical observation and the appellant has kept cash from her savings with her and during demonetization period, the same was deposited in her bank account. Sources of cash deposits as well as payment of LIC policy premium would be easily explained with proper evidences. So it was pleaded that one opportunity may be given to appellant to explain sources of cash deposit as well as LIC premium before Ld. CIT(A) with necessary evidences. The Ld. AR of the appellant has mentioned that the appellant’s daughter is working in a bank and they can explain the sources for cash deposited. It was also argued by Ld. AR that the case was dismissed on the ground of non-appearance and the merits raised in grounds of appeal were not adjudicated by Ld. CIT(A). As the Ld. CIT(A) did not adjudicate the grounds raised by the appellant, it is not proper to dismiss the appeal only based on non-appearance. In the case of Premkumar Arjundas Luthra HUF (69 Taxman.com 407)(Bom) it was held that Ld. CIT(A) cannot dismiss the case without discussing the merits.
5. Ld. DR opposed the prayer of Ld. AR because no such evidences were produced before Ld. CIT(A) and even after several opportunities, the appellant has not provided these details and hence additions made by the Ld. AO should be sustained.
6. After hearing rival submissions, it is decided to condone a small delay of nine days. As far as merits of the case are concerned after hearing rival submissions, it is decided that one more opportunity would be given to the appellant to explain sources with respect to both the additions made by the Ld. AO before Ld. CIT(A). The appellant is directed to cooperate with the Department and file necessary particulars. In the interest of justice, the issue is remitted back to the file of Ld. CIT(A).
3 Naresh Atmaram Talreja 7. Appeal is allowed for statistical purposes.
Order pronounced in the open Court on 26/03/2025.