VDC FOOD TRADING,VELLORE vs. ITO,WARD-1,, VELLORE

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 2018-19, vide order dated 03.12.2024.

At the outset, we find that there is a delay of 32 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 unwell and suffering from severe fever and dehydration and therefore there was a slight delay in signing the documents and handing it over to his advisor and the assessee also stated that the delay was only due to unavoidable health situation. After considering the Affidavit filed by the assessee

Brief facts are that the assessee is a firm engaged in the business of wholesale dealer of Hindustan Unilever products, Maida and Vanaspathi and is earning income from commission and brokerage. The case of the assessee-firm was re-opened u/s.147 of the Act as it was seen that the assessee-firm had deposited cash of Rs.9,93,41,455/-in bank account maintained with Central Bank of India and deposited cash of Rs.77,74,527/- in his bank account maintained with Indusind Bank Limited totaling Rs. 10,71,15,982/-. Further, it was seen that the assessee had made cash withdrawals of Rs.19,03,790/- from bank account maintained with Central Bank of India and cash withdrawals of Rs.24,85,000/- from his bank account maintained with Indusind Bank Limited totaling Rs.43,88,790/- and Interest other than interest on securities (Section 194A) of Rs.24,842/- during the F.Y. 2017-18 relevant to A.Y. 2018-19.

Before the ld.CIT(A) also, the assessee has neither filed written submissions nor filed any documentary evidence in support of his claim. Therefore, the CIT(A) dismissed the appeal by confirming the order of the ld. Assessing Officer. Aggrieved by the order of CIT (A), the assessee has filed 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 CIT(A) even the :-4-: ITA. No:934/Chny/2025 assessment order was passed under Section 144 by the Assessing Officer. Therefore, he prayed that one more opportunity may be provided to the assessee to represent his case before the Assessing Officer in the interest of natural justice.

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 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 by relying on the decision of the Hon’ble Supreme Court in the case of Tin Box Company vs CIT, [2001] 249 ITR 216 (SC) and direct 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 and relevant documents if advised so.