MARAPPAGOUNDER PERIASAMY,CHENNAI vs. ITO, NCC-19(1), CHENNAI

The assessee filed his return of income on 18.09.2014, declaring a total income of Rs. 22,00,000/-. The A.O has reopened the assessment and made addition of Rs. 21,39,877/- in the order passed u/s. 147 of the Act, on the ground that the assessee has failed to satisfactorily explain the difference in the closing balance of SBI account as shown in the bank statement and in the balance sheet.

Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. Ld. CIT(A). However, the Ld. CIT(A) had dismissed the appeal ex-parte as the assessee did not make any submissions during the course of appellate proceedings.

The Ld. Authorized Representative (A.R.) submitted that the Ld. CIT(A) has decided the appeal ex-parte without granting sufficient opportunity to the assessee, and therefore, prayed that one more opportunity be granted to substantiate the assessee’s claim.

The Learned Departmental Representative (Ld. D.R.) relied on the orders passed by the lower authorities.

We have heard the rival submissions and perused the material available on record. It is observed that the A.O. made an addition of Rs. 21,39,877/- u/s. 69 of the Act, on account of the difference in the closing balance of the SBI account as per the balance sheet and the bank statement. The addition was made on the basis that the assessee failed to offer a satisfactory explanation regarding the said difference. On appeal, the Ld. CIT(A) dismissed the appeal ex-parte due to non-appearance and non-submission by the assessee. Before us, the Ld. A.R. submitted that the A.O. erroneously treated Savings Bank Account No. 20001037598 and Current Account No. 10562765 as one and the same, assuming both relate to the assessee's business. However, the savings account pertains to the assessee’s personal account and has no connection with business operations. It was further submitted that the assessee is now in a position to provide all necessary details and documentary evidence to substantiate his case. In our considered opinion, and keeping in view the principles of natural justice, the assessee be provided with another opportunity of hearing to substantiate his case before the Ld. CIT(A). Accordingly, we remit the matter back to the file of the Ld. CIT(A) for denovo adjudication. We also direct the assessee to appear before the Ld. CIT(A) on the date of hearing without fail and furnish complete details for fresh consideration. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.