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Facts
The assessee, an individual, disclosed interest and agricultural income. During demonetization and prior periods, significant cash deposits were made. The assessee's response to assessment notices was delayed due to medical reasons.
Held
The Tribunal noted that the assessee failed to present her case before the Assessing Officer, who passed an ex parte order. While the Revenue argued for dismissal, the Tribunal, considering principles of natural justice, restored the matter to the Assessing Officer for a fresh decision.
Key Issues
Whether the assessee was denied a reasonable opportunity of hearing by the Assessing Officer, and if so, whether the matter should be remanded for a fresh assessment.
Sections Cited
142(1), 69A, 115BBE, 144
AI-generated summary — verify with the full judgment below
This appeal by the assessee is directed against the order of National Faceless Appeal Centre, Delhi (NFAC)/learned Commissioner of Income Tax (Appeals) [in short, the ld. CIT(A)] dated 14/11/2024 for the Assessment Year (AY) 2017-18 as per ground of appeal on record.
Rival contentions of both the parties have been heard and record perused. The ld. AR of the assessee submitted that the assessee is an individual and derives interest income on the Fixed deposit and Savings bank account maintained with the banks and also derives Agricultural income. The assessee has also been deriving income from dairy and agricultural income for the past 25 years. For the A.Y. 2017-18, the assessee filed a return of income on 25/10/2019 disclosing an income of Rs.3,90,292/- and agricultural income of Rs.3,00,000/- in response to 2 ITA1924/Chny/2025 Vedha Vs ITO notice issued by the Assessing Officer u/s 142(1) dated 09-03-2018. The Assessing Officer, thereafter, issued various statutory notices but the assessee did not respond. The assessee now has stated that the same was occurred due to the fact that the assessee underwent twin surgeries and was confined to bed and was not in a position to respond to any of the letters. However the assessee filed a return of income on 25-10-2019 in response to the notice u/s 142(1). The assessee was asked to explain the source of cash deposits in the State Bank of India during the demonetization period amounting to Rs. 14,38,000/- and also the cash deposit made in the non demonetization period amounting to Rs.12,51,000/-. The assessee explained the same as out of opening cash and current year agricultural income with reference to the cash flow arrived at by her. The AO rejected the submissions and treated the total deposits amounting to Rs 26,89,000/- as unexplained money u/s 69A and also invoked the provisions of Sec. 115BBE of the Act.
Being aggrieved by the order of Assessing Officer, the assessee preferred appeal before the ld. CIT(A), who vide the impugned order dismissed the appeal of the assessee by observing that the assessee had failed to explain the source of cash deposits in the bank account and proof of agriculture activities and agriculture income.
Further aggrieved by the order of ld. CIT(A) the present appeal was filed before this Tribunal.
Before us, the ld. AR of the assessee has submitted that the Assessing Officer has not provided the assessee a reasonable and effective opportunity of hearing.
3 ITA1924/Chny/2025 Vedha Vs ITO The Assessing Officer passed ex parte order without considering the merit of the case. Therefore, the ld. AR prayed to restore the matter back to the file of Assessing Officer to decide the issue afresh in accordance with law.
On the other hand, the ld. Sr.DR for the revenue has submitted that the assessee is not serious in pursuing its appeal before the Assessing Officer and the ld. CIT(A). Therefore, the assessee deserves no leniency at this stage and the appeal of the assessee may be dismissed with cost.
We have considered the submissions of both the parties and we find that the assessee has not presented her case before the Assessing Officer on the basis of which the Assessing Officer passed assessment order under Section 144 of the Act. The Assessing Officer has provided more than five opportunities to the assessee to respond the notices issued by him but the assessee failed to do so.
Now before us, the ld. AR of the assessee submitted that, one more opportunity may be provided to the assessee and he undertakes that the assessee will be vigilant in complying the notices issued by the Assessing Officer. In view of the above facts and circumstances of the case and in view of the principles of natural justice, one more opportunity has to be provided to the assessee, therefore, we restore the matter back to the file of Assessing Officer to decide the issue afresh by providing adequate opportunity of being heard to the assessee. The assessee is also directed to be more vigilant in making necessary compliance before the Assessing Officer and provide all necessary documents and evidences to substantiate her claim. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes only.
4 ITA1924/Chny/2025 Vedha Vs ITO
In the result, this appeal of assessee is allowed for statistical purposes.
Order pronounced in the open court on 26/09/2025.