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Income Tax Appellate Tribunal, DELHI BENCH “G”: NEW DELHI
Before: SHRI R.K. PANDA & SHRI KULDIP SINGH
the assessee for both the years in appeal, therefore, these were heard together and are being disposed of by this common order.
Facts of the case, in brief, are that the assessee is an individual. Information was received on the basis of AIR that the assessee has made investment in the purchase of immovable properties during financial year 2008-09 for Rs. 67,68,216/- and for assessment year 2010-11 investment in agricultural land of Rs. 8,40,523/-. The AO, therefore, issued a letter to the assessee on 3rd May 2013. It was stated by the assessee that he is an agriculturist and has made the investment of Rs. 67,68,216/- for assessment year 2009-10 and Rs. 8,40,523/- for the assessment year 2010-11 out of the accumulated money in the bank account which was earned from agricultural land. However, in absence of any documentary evidence in support of the savings from the agricultural income, the AO held that the source of investment is not verifiable and the investment as mentioned above for the above two years remained unexplained. He, therefore, reopened the case of the assessee by recording reasons and issued notice u/s 148 of the I.T. Act to the assessee for the above two years. However, no return of income was filed by the assessee in response to the notice issued u/s 148 of the I.T. Act. The notice issued u/s 142(1) alongwith query letter dated 30th April 2014 for the above two years which was served upon the assessee also remained uncomplied with. He further noted that the assessee has made cash deposit of Rs. 55,00,000/- in his bank account for assessment year 2009-10 and Rs. 1,90,000/- for assessment year 2010-11 which remained unexplained. The AO, therefore, invoked the provisions of section 144 and determined the total income of the assessee at Rs. 1,22,68,220/- for assessment year 2009-10 and Rs. 10,30,520/- for assessment year 2010-11.
Since there was no compliance by the assessee before the Ld. CIT(A), the Ld. CIT(A) in the ex parte order passed by him sustained the additions made by the AO for both years.
4. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds :-
Grounds of appeals for the assessment year 2009-10
1. “Because, the order of learned lower authority is bad in law & against the facts and circumstances of the case and hence is unsustainable. '
2. Because, the Ld. commissioner of income tax (appeals) grossly erred in dismissing the appeal without affording opportunity of being heard and adduce evidences due to non- appearance on 16.02.17, though it was in knowledge of Id. authority that AR was held with sufficient cause for non-appearing on that date.
3. Because the Id. commissioner of income tax (appeals) failed to appreciate agriculturist and uneducated/unaware assessee could not file evidences/replies on the issues before Ld. AO, hence unilateral levy of tax is punitive/harsh and is against the basic spirit of law.
4. Because, without prejudice to above, the Id. commissioner of income tax (appeals) failed to adjudicate several grounds in the absence of any representation like jurisdictional issues in terms of ground 1 of form 35 , no possibility of additions u/s 68 in terms of ground 7 etc. hence order is against all the cannons of law.
5. Because, without prejudice to above, on merits the Id. commissioner of income tax grossly erred in sustaining both the additions summarily even without considering the issues raised in grounds of appeal with the material on the record like bank a/c, sale deed etc. and without conducting any enquiry u/s 250(4) of the Act.”
Grounds of appeals for the assessment year 2010-11
1. “Because, the order of learned lower authority is bad in law & against the facts and circumstances of the case and hence is unsustainable. ' the Ld. commissioner of income tax 2. Because, (appeals) grossly erred in dismissing the appeal without affording opportunity of being heard and adduce evidences due to non- appearance on 16.02.17, though it was in knowledge of Id. authority that AR was held with sufficient cause for non-appearing on that date. 3. Because the Id. commissioner of income tax (appeals) failed to appreciate agriculturist and uneducated/unaware assessee could not file
evidences/replies on the issues before Ld. AO, hence unilateral levy of tax is punitive/harsh and is against the basic spirit of law.
Because, without prejudice to above, the Id. commissioner of income tax (appeals) failed to adjudicate several grounds in the absence of any representation like jurisdictional issues in terms of ground 1 of form 35 , no possibility of additions u/s 68 in terms of ground 7 etc. hence order is against all the cannons of law.
Because, without prejudice to above, on merits the Id. commissioner of income tax grossly erred in sustaining both the additions summarily even without considering the issues raised in grounds of appeal with the material on the record like bank a/c, sale deed etc. and without conducting any enquiry u/s 250(4) of the Act.”
5. Ld. Counsel for the assessee submitted that the assessee is an agriculturist and the order was passed by the AO u/s 144 of the Act without giving reasonable opportunity of being heard. Thus the principles of natural justice was denied to the assessee by the AO for both the years. Even before the Ld. CIT(A), although the assessee had filed an adjournment application, however, Ld. CIT(A) without giving any adjournment to the assessee dismissed the appeal by relying on the decision of Hon’ble Supreme Court in the case of CIT vs. B.N. Bhattachargee & Another 118 ITR 461, the decision of Hon’ble Madhya Pradesh High Court in the case of Late Tukoji Rao Holker vs. CWT 223 IR 480 (MP) and the decision of the Tribunal in the case of CIT vs. Multiplan India Pvt. Ltd. 38 ITD 320 (Delhi). He submitted that in the interest of justice, the assessee should be given one more opportunity to substantiate his case.
6. Ld. Sr. DR on the other hand strongly opposed the arguments advanced by the assessee. Referring to the copy of the assessment order and the orders of Ld. CIT(A), he submitted that the assessee was non cooperative from the very beginning. There was no compliance either before the AO or before the Ld. CIT(A). Further the AO had given valid reason as to why the addition was made since the assessee could not substantiate with evidence to his satisfaction regarding the source of investment being out of agricultural income. Further the assessee failed to produce any evidence before the Ld. CIT(A) to support his contention that the investment is out of agricultural income. He accordingly submitted that the order of the Ld. CIT(A) be upheld.
7. We have considered the rival arguments made by both the sides, perused the order of the AO and Ld. CIT(A) and the paper book filed on behalf of the assessee . We have also considered the various decisions cited before us. A perusal of the assessment 6 order shows that due to non compliance from the side of the assessee and in absence of any explanation to substantiate the source of agricultural income for investment in the various properties and the cash deposits in the bank account, the AO determined the total income of the assessee at Rs. 1,22,68,220/- for assessment year 2009-10 and Rs. 10,30,520/- for assessment year 2010-11. A perusal of the order of the Ld. CIT(A) shows that despite number of opportunities granted by him the assessee was seeking adjournment from time to time. Although the final opportunity was granted for hearing on 25th January, 2017 we find the assessee filed an adjournment application seeking adjournment of the case which was rejected by the Ld. CIT(A). Thus the conduct of the assessee before the AO as well as Ld. CIT(A) is not above board. However, considering the totality of the facts of the case and in the interest of justice and on the assurance given by the Ld. Counsel for the assesee that the assessee will cooperate before the AO for early hearing of the assessment, we deem it proper to grant one final opportunity to the assessee to substantiate his case before the AO. We, therefore, restore the matter to the file of the AO with the direction to give one last opportunity to the assessee to substantiate his case and decide the issues as per fact and law. The assessee is also hereby directed to appear before the AO without seeking any adjournment under any pretext and substantiate the source of investment by producing necessary evidences to the satisfaction of the AO failing which the AO is at liberty to pass appropriate order as per law. We hold and direct accordingly. Grounds raised by the assessee are allowed for statistical purposes.
In the result both the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open court at time of hearing itself i.e. on 1st February, 2021.