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Facts
The Assessing Officer made additions of Rs. 17,84,515/- for estimated business profit and Rs. 2,50,98,679/- for unexplained cash credit under Section 68. The CIT(A) also passed an ex-parte order due to inadequate compliances, prompting the assessee to appeal citing personal difficulties for non-compliance.
Held
The Tribunal found that the lower authorities had not objectively and comprehensively analyzed the case merits regarding cash credits and estimated business income. It remitted the matter back to the Assessing Officer for fresh de novo adjudication, providing the assessee one last opportunity to present their case and evidence, and set aside the orders of the lower authorities.
Key Issues
The key issues were the justification of additions for estimated business profit and unexplained cash credit under Section 68, the validity of ex-parte orders by lower authorities, and whether the assessee should be granted another opportunity to present their case and evidence.
Sections Cited
68
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Income Tax Appellate Tribunal, ‘D’ BENCH: CHENNAI
Before: SHRI ABY T VARKEY & SHRI AMITABH SHUKLA
Assessment Years: 2012-13 Argalam Associates, Income Tax Officer, No.21/3 (Old No.43A), Indira Nagar, Non-Corp Ward-15(1) 2nd Avenue Road, Adyar, Chennai. Chennai-600 020. [PAN: AANPA6941K] (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Shri N.V.Narayanan, Advocate प्रत्यर्थी की ओर से /Revenue by : Ms.Gautham S.Mukundan, IRS सुनवाई की तारीख/Date of Hearing : 04.06.2025 घोषणा की तारीख /Date of Pronouncement : .06.2025 आदेश / O R D E R PER AMITABH SHUKLA, A.M :
This appeal is filed by the assessee/Revenue against the order bearing DIN & Order No.ITBA / NFAC / S / 250 / 2024-25 / 1072558291(1) dated 27.01.2025 of the Learned Commissioner of Income Tax [herein after “CIT(A), National Faceless Appeal Center[NFAC], Delhi, for the assessment year 2012-13. The reference to the word “Act” in this order hereinafter shall mean the Income Tax Act, 1961 as amended from time to time. 2.0 At the outset, the Ld.AR submitted that the Ld.AO has passed an ex-parte order making addition of Rs.17,84,515/- on account of estimated business profit and of Rs.2,50,98,679/- on account of unexplained cash credit u/s 68. It was submitted that the Ld.CIT(A) also passed an ex- parte order on the premise of inadequate compliances. It has been pleaded that the assessee could not make requisite compliance before the lower authorities on account of personal difficulties. It was urged that the assessee’s non-compliance be excused and one last opportunity be given to present its case before the lower authorities. 3.0 Per contra, the Ld.DR relied upon the order of lower authorities. 4.0 We have heard the rival submissions in the light of material available on records. Admittedly, there was a delay before the lower authorities, however we also conscious of the fact that no litigant benefits by non-prosecution of its case. We have noted from the order of lower authorities that merits of the case have not been appropriately examined before arriving at their impugned decision. The assessee also can not escape the blame of submission of incomplete documents. Be that as it may be, we are of the view that the matter concerning cash credits and estimated business income of the assessee have not been objectively and comprehensively analyzed by the lower authorities. We are of the view that ends of justice would be met if the assessee is given one last opportunity to present its case and filed supporting evidences before the Ld.AO. The decision to remit it back to the Ld. AO is taken in view of the fact that an Assessing Officer is the fulcrum of assessment proceedings. Page - 2 - of 4 He possess the first right and responsibilities to examine facts of a case before arriving at his decision qua determination of taxable income in a particular case. Without prejudice it has also been noted that in this case the Ld. AO did not have adequate opportunities to examine the varied facts seminal therein. We have noted with respectful deference the decision of Hon’ble Apex Court in the case of TIN box 249 ITR 216 on the subject matter. Accordingly, the issue of addition of Rs.17,84,515/- on account of estimated business profit and of Rs.2,50,98,679/- on account of unexplained cash credit u/s 68 which have been contested by the assessee through its grounds of appeal stands remitted back to the Ld. AO for fresh adjudication de novo by passing a speaking order. To the extent the order of lower authorities on this issue stands set aside. The Ld. AO shall give opportunities of being heard to the assesse and it shall be bounden upon the assesse to comply with the notices issued by the Ld. AO. Any non-compliance on the part of the assesse can be adversely viewed. The assessee is at liberty to produce all the evidences filed through its paper book before us including any other evidences deemed relevant in support of its claims before the Ld. AO during the readjudication proceedings. Accordingly, all the grounds of appeal raised by the assessee are therefore allowed for statistical purposes.