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Facts
The assessee filed an appeal against the order of the CIT(A) for AY 2017-18, which was delayed by 701 days. The delay was condoned due to bonafide reasons. The assessee had made significant cash deposits during demonetization, which were treated as unexplained investment by the Assessing Officer and added to total income. The CIT(A) dismissed the appeal for non-compliance with hearing notices.
Held
The Tribunal condoned the delay and admitted the appeal. While acknowledging the assessee's failure to furnish evidence, the Tribunal noted that the assessment was completed under section 143(3) and the assessee's assistance was necessary for additions under section 69A. Considering the interest of justice, the matter was remanded to the CIT(A) with a condition.
Key Issues
Whether the CIT(A) was justified in confirming the addition made by the Assessing Officer for unexplained cash deposits, and whether the assessee was provided sufficient opportunity to present evidence before the CIT(A)?
Sections Cited
69A, 115BBE, 143(3), 142(1), 143(2), 69
AI-generated summary — verify with the full judgment below
Before: Shri S.S. Viswanethra Ravi&
Year: 2017-18 Govindarajan Allam Bala, Vs. The Income Tax Officer, New No. 149, 2nd Floor, Non Corporate Ward 1(2), Kodambakkam High Road, Chennai. T. Nagar, Chennai 600 017. [PAN:AFTPG2676Q] (अपीलाथ�/Appellant) (��थ�/Respondent) अपीलाथ� की ओर से / Appellant by : Shri M. Rajesh, Advocate ��थ� की ओर से/Respondent by : Ms. V. Supraja, Addl. CIT सुनवाई की तारीख/ Date of hearing : 15.07.2025 घोषणा की तारीख /Date of Pronouncement : 17.07.2025 आदेश /O R D E R
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:
This appeal filed by the assessee is directed against the order dated 29.03.2023 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi for the assessment year 2017-18.
We find that this appeal is filed with a delay of 701 days. The assessee filed an affidavit for condonation of delay stating the reasons. Upon hearing both the parties and on examination of the said affidavit, we find the reasons stated by the assessee are bonafide, which really prevented in filing the appeal in time. Thus, the delay is condoned and admitted the appeal for adjudication.
The assessee raised 5 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the ld. CIT(A) is justified in confirming the addition made by the Assessing Officer under section 69A r.w.s. 115BBE of the Income Tax Act, 1961 [“Act” in short] by passing exparte order.
The assessee filed his return of income for AY 2017-18 on 23.09.2017 admitting income of ₹.16,08,070/-. The case was selected for scrutiny under CASS and issued notice under section 143(2) of the Act dated 14.08.2018. Subsequently, notice under section 142(1) of the Act dated 06.08.2019 & 04.11.2019 were issued to the assessee calling for details. According to the Assessing Officer, the assessee made cash deposits of ₹.98,65,000/- during demonetization period. The details of cash deposits made by the assessee are reproduced at page 2 to 4 of the assessment order. The Assessing Officer issued show-cause notice to the assessee to explain as to why the cash deposit made during demonetization period should not be disallowance under section 69 of the Act. The reply filed by the assessee is reproduced at pages 5 & 6 of the assessment order. Since the assessee could not furnish evidence in support of his claim, the Assessing Officer treated the entire cash deposits of ₹.98,65,000/- made during demonetized period in SBN currency as unexplained investment under section 69 of the Act and added to the total income of the assessee. On appeal, the ld. CIT(A) dismissed the appeal of the assessee since the assessee did not comply with the hearing notices or filed any documentary evidences in support of grounds of appeal.
The ld. AR Shri M. Rajesh, Advocate submits that non- compliance to the hearing notices issued by the ld. CIT(A) is neither wilful nor deliberate but due to circumstances beyond assessee’s control. He argued that sufficient opportunity was not given to the assessee to file the evidences. The ld. AR prayed that, one more opportunity may be afforded to the assessee to pursue his case before the ld. CIT(A).
The ld. DR Ms. V.Supraja, Addl. CIT opposed the same and drew our attention to para 4.1.1 of the impugned order and argued that the ld. CIT(A) afforded ample opportunities to the assessee, but, it was not availed. She vehemently argued that costs may be imposed, in case this Tribunal affords an opportunity by remanding the matter to the file of the ld. CIT(A).
Heard both the parties and perused the material on record. We note that the assessment was completed under section 143(3) of the Act dated 19.12.2019. On perusal of the impugned order, we note that there was no assistance from the assessee to the hearing notices issued by the ld. CIT(A). We find the assistance of assessee is necessary in terms of additions involves under section 69A of the Act. Taking into consideration of the submissions of the ld. AR and the ld. DR and in the interest of justice, we deem it proper to afford one more opportunity and remand the matter to the file of the ld. CIT(A) subject to the condition of payment of ₹.5,000/- in favour of the State Legal Aid Authority, Hon’ble Madras High Court within 30 days from the date of receipt of this order and the ld. CIT(A) shall satisfy the payment of cost and decide the issue afresh after considering the written submissions/ documentary evidences as may be filed by the assessee to substantiate his claim. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 17th July, 2025 at Chennai.