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Facts
The assessee, a primary agricultural cooperative credit society, failed to file an ITR for A.Y. 2019-20. Its case was re-opened under Section 147 due to a cash deposit of Rs. 43.50 lakhs, leading to an ex-parte assessment under Section 144, adding the deposit as unexplained money. The CIT(A) confirmed the AO's order due to the assessee's non-participation.
Held
The Tribunal condoned the 69-day delay in filing the appeal, acknowledging the assessee's lack of digital literacy and remote location. It set aside the CIT(A)'s order and remitted the matter back to the AO for a de-novo assessment, granting the assessee a fresh opportunity, subject to a cost of Rs. 10,000/-.
Key Issues
Whether the ex-parte assessment and its confirmation should be set aside and remanded to the Assessing Officer for fresh adjudication, providing the assessee another opportunity to be heard despite previous non-participation.
Sections Cited
147, 144, 69A, 115BBE
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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA
आदेश /O R D E R
PER S. R. RAGHUNATHA, AM :
This appeal by the assessee is filed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, for the assessment year 2019-20, vide order dated 03.10.2024.
At the outset, we find that there is a delay of 69 days in appeal filed by the assessee, for which the assessee has filed affidavit stating the reasons for delay, wherein, it is submitted that the assessee was unaware of the outcome of the appeal before the ld.CIT(A) due to lack of digital literacy, infrequent Email usage and absence :-2-: ITA. No:717/Chny/2025 of physical communication which led to the delayed knowledge of the order passed. Further, the members of the assessee society are agriculturists residing in remote village with limited access to infrastructure and not accustomed to latest technological advancement like e-assessment and e-filing systems. After considering the Affidavit filed by the assessee and also hearing both the parties, we find that there is a reasonable cause for the assessee in not filing appeal on or before the due date prescribed under the law and thus, in the interests of justice, we condone delay in filing of appeal and admit the appeal filed by the assessee for adjudication.
Brief facts are that the assessee is a primary agricultural cooperative credit society. The assessee had not filed the return of income for the A.Y.2019-20. The case of the assessee was re-opened u/s.147 of the Act based on the data of cash deposit of Rs.43,50,623/- in bank account maintained with Cuddalore District Central cooperative Bank. Accordingly, the statutory notices were issued to the assessee. The assessee neither filed its return of income nor responded to the notices issued by the AO. Therefore, show-cause notice dated 18.01.2024 was issued upon the assessee proposing to make an addition of cash deposit of Rs.43,50,623/-. The assessee filed reply providing only the bank statements and sought time to furnish the remaining documents. Later, the AO issued a letter dated 13.02.2024 and provided one more opportunity to furnish the details latest by 19.02.2024, failing which an exparte assessment order u/s.144 of the Act will be passed. However, as the assessee failed to comply to the aforesaid notices issued from time to time, the AO concluded the assessment by passing an exparte order u/s.144 of the Act dated 22.02.2024 by adding the amount of Rs.43,50,623/- for the year under consideration u/s.69A r.w.s.115BBE of the Act as unexplained money.
:-3-: ITA. No:717/Chny/2025 4. Aggrieved by the order of the Assessing Officer, the assessee filed an appeal before the ld. CIT (A), NFAC, Delhi.
Before the ld.CIT(A) also, the assessee has neither filed written submissions nor filed any documentary evidence in support of his claim, in spite 3 opportunities provided by the ld.CIT(A) as per para 4 of its order from 10.07.2024 to 13.09.2024. Therefore, the ld.CIT(A) dismissed the appeal by confirming the order of the Assessing Officer. Aggrieved by the order of ld.CIT(A), the assessee has filed an appeal before us.
The ld.AR submitted that the assessee has not received notices issued by the ld.CIT(A). Hence, the appeal was not prosecuted before the ld.CIT(A) even the assessment order was passed exparte u/s. 144 of the Act by the Assessing Officer. Therefore, ld.AR prayed for one more opportunity may be provided to the assessee to represent his case before the Assessing Officer in the interest of natural justice. Further, the ld.AR assured the bench that he will undertake to represent on behalf of the assessee before the AO, in case one more opportunity is provided.
Per contra, the ld.DR submitted that both the Assessing Officer and the ld.CIT(A) provided sufficient opportunity to appear before them. However, the assessee has been negligent in responding to the statutory notices and hence, prayed for confirming the order of the ld.CIT(A).
We have heard the rival parties and perused the material available on record and gone through the orders of the lower authorities. We note that the Assessing Officer has passed an exparte order by considering the information available with the department and the same has been dismissed by the ld.CIT(A) - NFAC due to non-participation of the assessee before the first appellate authority. Since the assessee has failed to :-4-: ITA. No:717/Chny/2025 participate both before the Assessing Officer as well as the appellate authority, we levy the cost of Rs.10,000/- to be paid to State Legal Aid Authority, Hon’ble High Court of Madras and produce proof of payment of cost to the Registry within 30 days from the date of receipt of this order.
In view of the above and to meet the ends of justice we set aside the order of ld.CIT(A) and remit the matter back to the file of Assessing Officer and direct the AO to denovo frame the assessment order in accordance to law, after providing reasonable opportunity to the assessee. Needless to say, the assessee to be diligent and file written submissions, relevant documents if advised so and not take adjournment unnecessarily.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the court on 24th July, 2025 at Chennai.