SMT. NEHA GOPAL SHARMA,MUMBAI vs. DY CIT-26(1) (ERSTWHILE DY CIT CIRCLE-23(3) ), MUMBAI

In this appeal, the assessee has raised following grounds:–

The brief facts of the case, as emanating from the record, are: The assessee is an individual and derived income from his business, short term capital gain and income from other sources. For the year under consideration, the assessee filed her return of income declaring taxable income of Rs.39,81,041, on 31/10/2007. During the course of assessment proceedings, upon a perusal of the Balance Sheet, it was observed that the assessee was having cash balance of Rs.6,70,891, as on 31/03/2007, in her proprietary concern, viz. Shivalik Enterprises. The assessee was asked to explain the huge cash balance in hands with the help of cash flow statement. In reply, the assessee submitted that cash balance was maintained to meet the business expenditure. It was further submitted that there was a search action against her husband which took place on 16/03/2007, as a routine practice and CBI procedure, the Bank accounts were freezed and, therefore, cash was kept aside for continuation of business. The Assessing Officer further noticed that in the course of search by the CBI authorities on 16/03/2007, cash of Rs.40,000, was found with the assessee. Accordingly, the assessee was given an Page | 2

Against the aforesaid assessment order, the assessee filed appeal before the learned CIT(A). However, despite several notices for hearing issued by the learned CIT(A), the assessee neither appeared nor filed any document explaining the source of cash credit in her books of account. Accordingly, the learned CIT(A), in the absence of any proof, confirmed the addition made by the Assessing Officer. Being aggrieved, the assessee is in appeal before us.

During the course of hearing, the learned A.R. submitted that though the assessee could not appear before the learned CIT(A), however, the assessee had filed written submission dated 14/02/2013, which was neither referred nor considered by the learned CIT(A), while dismissing the assessee’s appeal vide impugned order.

On the other hand, the learned Departmental Representative vehemently relied upon the orders passed by the lower authorities and submitted that assessee failed to avail various opportunities of hearing granted by the learned CIT(A).

We have considered the rival submissions and perused the material available on record. It is evident that the learned CIT(A) has passed the impugned order ex–parte due to non–appearance of/on behalf of the assessee. However, now in the appeal before us, the learned A.R. has submitted that though the assessee could not appear before the learned CIT(A), the written submission dated 14/02/2013 was filed by the assessee, which was neither referred nor dealt by the learned CIT(A) while passing the impugned order. In view of the above, we are of the considered opinion that in the larger interest of justice, the assessee be granted one more opportunity to represent her case on merits before the learned CIT(A). Accordingly, the matter is restored to the file of the learned CIT(A) for de novo adjudication after consideration of all the details / submissions as may be filed by the assessee. Further, the assessee is directed to appear before the learned CIT(A) on all the dates of hearing, as may be fixed, without any default. Thus, grounds raised by the assessee are allowed for statistical purpose.

In the result, appeal by the assessee is allowed for statistical purpose. Order pronounced in the open court on 06/06/2022