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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of the CIT(A)- National Faceless Appeal Centre (NFAC), Delhi passed u/s 144 and 250 of the Act. The assessee has raised the following grounds of appeal:
1. The Hon. CIT(A), National Faceless Appeal Centre (NFAC), Delhi erred in deciding the appeal exparte, without affording the appellant any reasonable opportunity to furnish her say, thereby breaching the Asha Krishnarao Bhoge., Mumbai. - 2 -
principles of equity, fairplay and natural justice for which reason the appeal order be quashed/set aside.
The Hon. CIT(A) erred in not adjudicating the ground challenging the re-opening of assessment u/s 147 of the I. Tax Act 1961, by issue of the notice u/s 148 dt. 29.03.2014 and therefore not appreciating the argument that the re-opening was on the basis of incorrect information from Investigation wing, which was relied upon by the ld AO, without any independent verification and therefore the notice u/s 148 was incorrectly issued and the resultant assessment bad-in-law.
The Hon. CIT(A) erred in confirming the addition of Rs. 8,20,000/-, as unexplained investment in cash, towards purchase of shop no. 129, Arcadia Building, Thane from Hiranandani Group, when in reality the appellant had not made any such investment in cash with the Hiranandani Group and therefore the addition Rs.8,20,000/- was not warranted and hence may kindly be deleted.
The Hon. CIT(A) erred in not appreciating that the ld AO had relied upon information received from DIT (Inv)-II, Mumbai without affording the appellant with adequate opportunity to cross examine the sources of such adverse information thereby breaching the salient principles of equity, fair play and natural justice and therefore the order framed in breach of the principles of natural justice was bad-in law and void-ab-initio.
Asha Krishnarao Bhoge., Mumbai. - 3 -
5. The appellant craves leave to add, alter, amend and/or vary any of the above grounds of appeal at any time before the decision of the appeal.
2. The brief facts of the case that, the assessee is an individual and derives interest income and agriculture income. The assessee has filed the return of income for the A.Y 2007-08 on 03.06.2014 disclosing a total income of Rs. 27,744/-.There was search operations conducted at Hiranandani Group, Builders & Developers by DIT (Inv) Mumbai and in the course of search certain evidences found with respect to payment of on-money by various flat purchases, whereas on the basis of the material information, the assessee has paid on-money of Rs. 8,20,000/- for the purchase of shop No.129 flat in Building Arcadia. The Assessing officer (A.O.) after duly recording the reasons for reopening and has reason to believe that the income has escaped the assesseement and issued notice u/s 148 of the Act. Subsequently the notice u/s 143(2) and 142(1) of the Act are issued. The A.O. has called for the various information/details and provided ample opportunities but there was no response from the assessee. The AO relied on the Asha Krishnarao Bhoge., Mumbai. - 4 - information on record and applied the Best judgment Assesseement u/sec144 of the Act and made addition of Rs. 8,20,000/- and assessed the total income of Rs. 8,47,744/- and passed the order u/s 144 r.w.s 147 of the Act dated 24.03.2016.
3. Aggrieved by the AO order, the assessee has filed an appeal before the CIT(A). Whereas the CIT(A) found that the notice was submitted to the assessee through ITBA portal but there was no compliance. Therefore the CIT(A) considering the statement of facts and the information available on record has confirmed the action of the AO and dismissed the assessee appeal. Aggrieved by the CIT(A) order, the assessee has filed an appeal with the Hon’ble Tribunal.
4. At the time of hearing, the Ld. AR submitted that the CIT(A) has erred in not considering the various information filed and further the assessee has not paid any on-money to the builder and the transaction was cancelled and prayed for allowing the appeal. Contra, the Ld. DR supported the order of the CIT(A).
Asha Krishnarao Bhoge., Mumbai. - 5 -
We heard the rival submissions and perused the material on record. The sole crux of the disputed issue is with respect to the addition confirmed by the CIT(A) in respect of on-money. The Ld. AR contended that the assessee has not paid on-money to the builder and in fact the assessee has only paid Rs.1 lakh by cheques and subsequently the transaction was cancelled. Further, the Ld. AR mentioned that the AO has only relied on the third party information and no enquiry was conducted. When a query was raised to the Ld.AR that what are the reasons for not appearing before the AO and the order passed by the AO is the best judgment assessment. The Ld. AR submitted that there was change of residential address and assessee has not received the notices and prayed for an opportunity to substantiate with the evidences before the lower authorities. We considering the principles of natural justice shall provide one more opportunity to the assessee to substantiate the case with evidences before the lower authorities and remit the disputed issue for limited purpose to the file of the Assessing officer to adjudicate on merits and the assessee should be provided adequate opportunity of hearing and shall
Asha Krishnarao Bhoge., Mumbai. - 6 - cooperate in submitting the details expeditiously. Accordingly the grounds of appeal are allowed for statistical purposes.
In the result, the assessee appeal is treated as allowed for statistical purpose.
Order pronounced in the open court on 25.08.2022.