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Facts
The assessee, a cooperative organization, failed to file its return of income and respond to notices regarding cash deposits made during demonetisation and the rest of the year. Consequently, ex-parte assessment orders were passed by the AO and confirmed by the CIT(A).
Held
The Tribunal noted that both the assessment order and the CIT(A)'s order were ex-parte and not on merits. Given the assessee's status and potential explanations for the deposits, the Tribunal decided to grant one more opportunity.
Key Issues
Whether the ex-parte assessment order and CIT(A) order, passed without considering the assessee's explanation, should be set aside to allow denovo consideration.
Sections Cited
144, 69A
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Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE
Before: SHRI PRASHANT MAHARISHI & SHRI SOUNDARARAJAN K.
ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER
This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 25/02/2025 in respect of the A.Y. 2017-18.
At the outset, we found that the assessment order was made u/s. 144 of the Act. Similarly, the appeal order was also passed for the non- appearance of the assessee. The brief facts of the case are that the assessee had deposited a sum of Rs. 10,30,000/- during the demonetisation period and an amount of Rs. 57,04,950/- during the rest of the year and the AO sought for the details of the cash deposits. Therefore the AO had made an assessment u/s. 144 of the Act in which the entire cash deposits made into the bank account has been treated as unexplained money u/s. 69A of the Act. As against the said ex-parte order, the assessee filed an appeal before the Ld.CIT(A) but the assessee had not appeared before the Ld.CIT(A) and therefore the Ld.CIT(A) had considered the issue on the basis of the materials available before him and confirmed the order made by the AO by observing that the assessee had not submitted any documentary evidence to substantiate their claim.
As against the said order, the present appeal has been filed before this Tribunal.
At the time of hearing, the Ld.AR submitted a paper book and enclosed the written submissions as well as the acknowledgment for filing the various documents before the Ld.CIT(A) and prayed that the order of the Ld.CIT(A) may be set aside for non-consideration of the said reply.
The Ld.DR relied on the orders of the lower authorities and submitted that the assessee had furnished the documents on 25/02/2024 but the Ld.CIT(A) had passed an order on 25/02/2025 at about 12:56 pm and therefore the submissions made by the assessee was not before the Ld.CIT(A) when the order has been passed and prayed to dismiss the appeal.
We have heard the arguments of both sides and perused the materials available on record.
We have perused the assessment order as well as the order of Ld.CIT(A), both are ex-parte orders and not on merits. Considering the fact that the assessee is a co-operative organisation and the assessee had valid explanations for the cash deposits made and also considering the fact that the assessee had furnished the details to the hearing notices issued by the Ld.CIT(A), we are inclined to grant one more opportunity to the assessee to appear before the AO and produce all the details before the AO. We, therefore, set aside the ex-parte orders passed by the AO as well as the Ld.CIT(A) and remit the issue to the file of the AO for denovo consideration and the assessee is directed to co-operate with the AO in completing the assessment without seeking any further adjournments.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 12th November, 2025.