NARENDER SINGH CHANDILA,FARIDABAD vs. ITO WARD-2(1), FARIDABAD

This appeal filed by the Assessee is directed against the impugned order dated 27.2.2019 passed by the Ld. CIT(A), Faridabad in relation to assessment year 2015-16 on the following grounds:-

1. That under the facts and circumstances of the case Ld. CIT(A) has erred in law as much as in fact in dismissing the appeal filed by the appellant ex-parte qua the appellant as notice dated 01-02-2019 issued for hearing on 13-02- 2019 was never served upon the assessee. 1

2. That under the facts and circumstances of the case and in law Ld. CIT(A) has erred in law as much as in fact in upholding the addition made by the AO of a sum of RS. 42,21,319/- allegedly being unexplained cash deposit in the bank accounts of the assessee. While upholding such addition he has failed to appreciate:- a) That the assessee had furnished explanation before the AO which has been recorded in the assessment order that, the cash amount deposited in the bank account of the assessee was relating to amount received as booking amount from different costumers for booking of plots in Neharpur, Faridabad and also that the amount was refunded to such costumers where the deal was not matured and giving the list of names of persons from whom such booking amount was received coupled with the Plot No. ; total amount received and refunded amount. Complete details of amount received for a sum of Rs. 53,05,000/- and amount repaid amounting to Rs. 46,00,674/- was given. The AO without examining those details made the addition which was required to be deleted by Ld. CIT(A). b) That Ld. CIT(A) has also failed to appreciate that assessee had started the business of earning commission from booking of plots etc. and in that process such amount was received and repaid and these were usual business transactions of the assessee out of which commission earned was subjected to Income Tax in the returned filed by the assessee. c) That Ld. CIT(A) has also failed to appreciate that without making any inquiry into the details submitted by the assesse with regard to the name of the persons and details regarding Plot No. etc., which are supported by original 2

refund amount receipt book; map of land from which the plots were booked; original stamp- paper of plot booking and cancelation; refund of advance money receipts and such evidence was completely ignored by the AO. These facts are mentioned in the ground of appeal filed before CIT(A). Therefore, also the order passed by Ld. CIT(A) is liable to be set aside.

3. That under the facts and circumstances of the case Ld. AO has erred in law as much as in fact in initiating the proceedings for levy of penalty u/s 27ID. The initiation being bad in law should be set aside.

4. That each of the above ground is independent and is without prejudice to the other grounds of appeal preferred by the Appellant.

5. That the Appellant craves leave to add, alter, vary, omit, substitute or amend the above grounds of appeal, at any time before or at the time of hearing of the appeal.

6. That the levy of interest u/s 234A, 234B, 234C, 234D is invalid on the ground that the same is levied by way of an order which is invalid in the eyes of law.

2. The brief facts relating to the case are that the assessee has filed his return of income of Rs. 6,45,190/- on 07.11.2016 and the same was processed u/s. 143(1) of the Income Tax Act, 1961 (in short “Act”) by CPC as such. Subsequently, the case was selected for Limited Scrutiny through Computer Aided Scrutiny Selection (CASS) to examine with reason “large deposits in savings bank accounts (AIR 001, total turnover and other income in Part A-P & L of ITR)”. Notice u/s. 143(2) of the Act was issued to the assessee on 03.08.2017, which was duly 3 served upon the assessee. Thereafter notice u/s. 142(1) of the Act was issued on 04.9.2017 to the assessee for 19.9.2017 requiring to furnish the relevant information and details. None appeared in response to this notice. Thereafter, the AO also issued notice u/s. 142(1) of the Act to the assessee on 03.11.2017 alongwith letter of show cause issued to the assessee fixing the case for 13.11.2017. Assessee did not appeared. On change of incumbent the proceedings has been continued from the stage at which the proceeding was left, as per provision of Section 129 of the Income Tax Act, 1961 and notice u/s. 142(1) of the Act was issued to the assessee on 20.11.2017 for 04.12.2017 requiring the assessee to furnish the details already called for. In response to the same, the AR of the assessee appeared and attended the proceedings from time to time and submit various details as required by the AO alongwith the written submissions of the assesseee on the issue in dispute. After considering all the documentary evidences filed by the assessee, the AO was of the view that the assessee is a property dealer and received booking amount from different customers for booking of plots. Assessee has also furnished list of persons from which the amount of booking was received. After examining all the documentary evidences filed by the assessee alongwith the written submissions, the AO was of the view that as per individual transactions statements for the financial year 2014-15 relevant to assessment year 2015-16, the assessee deposited cash of Rs. 83,16,329/- in his different bank accounts which include Rs. 47,55,329/- in bank account maintained with Punjab National Bank, Rs. 19,01,700/- in bank account maintained with HDFC Bank and Rs. 16,59,300/- with bank account maintained with ICICI Bank and also Axis Bank. The bank accounts statements of the assessee was analysed by the AO and finally the AO was of the view that in the absence of the explanation regarding the source of cash deposits by the assesee with supporting of documentary evidences, the entire unexplained cash amounting to Rs. 42,21,319/- (8316319-4035000) deposited should be assessed as income of the assessee for the assessment year 2015-16 from undisclosed sources and added the same to the returned income of the assessee meaning thereby, the AO made the addition of Rs. 42,21,319/- and completed the assessment at Rs. 48,66,510/- u/s. 143(3) of the Act vide order dated 26.12.2017. Against the assessment order, assessee appealed before the Ld. CIT(A), who vide his impugned order dated 27.2.2019 and dismissed the appeal of the assessee by confirming the addition of Rs. 42,21,319/- u/s. 69A of the Act. Aggrieved with the impugned order dated 27.2.2019, asssessee is in appeal before the Tribunal.

3. At the time of hearing, Ld. Counsel for the assessee stated that in response to the various notices issued by the AO, the assessee has filed all the evidences for substantiating his claim which was not properly appreciated by the AO. Similarly, Ld. CIT(A) has also not gone through the evidences filed by the assessee and wrongly dismissed the appeal filed by the assessee. Ld. Counsel for the assessee further stated that 5 assesee is a property dealer and has been assessed the income of the assessee earned from dealing in property on presumptive basis as written by the AO in para no. 5 of the assessment order. The AO raised the query of bank deposits amounting to Rs. 83,16,329/- but after examining the documentary evidences filed by the assessee he made only the addition of Rs. 42,21,319/- ignoring the facts and circumstances of the present case and evidences filed by the assessee. Similarly, the Ld. CIT(A) has also wrongly upheld the assessment order by dismissing the appeal filed by the assessee. Ld. Counsel for the assessee finally stated that the addition made by the AO and confirmed by the Ld. CIT(A) is unwarranted in law because the details of the business transaction which was accepted by the AO and the applicability of presumptive taxation has also been admitted by both the authorities below. Even otherwise, all the documents substantiating the claim of the assessee has been filed, hence, the addition in dispute may be deleted.

4. On the contrary, Ld. DR relied upon the orders passed by the Ld. CIT(A) and stated that assessee remained unattended before the revenue authorities and the order passed by both the authorities are legal as per law and on the basis of the evidences produced by the assessee.

5. I have heard both the parties and perused the orders of the revenue authorities below. I am of the view that assessee remained non-cooperative before the revenue authorities and hence, not deserve for any relief from this Bench. But anyhow, it would be in the interest of justice, if the issues in dispute be set aside to the file of the Ld. CIT(A) with the directions to decide the same afresh, as per law, after giving adequate opportunity of being heard to the assessee. Therefore, in the interest of justice, I am setting aside the issues in dispute to the file of the Ld. CIT(A) to decide the same, afresh as per law, after giving adequate opportunity of being heard to the assessee. The Assessee is also directed to fully cooperate with the Ld. CIT(A) in the proceedings for the speedy disposal of the matter and did not take any unnecessary adjournment, otherwise, the Ld. CIT(A) is at liberty to decide the issues in dispute in accordance with law.