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Facts
The assessee's appeal was against an ex parte order passed by the Ld.CIT(A) for AY 2017-18. The assessee claimed that notices were not received due to them landing in the spam folder, preventing participation before the AO and CIT(A).
Held
The Tribunal set aside the impugned order of the Ld.CIT(A) and restored the assessment to the AO for de novo assessment. The Tribunal granted one more opportunity to the assessee due to the circumstances, while imposing a cost.
Key Issues
Whether the assessee should be granted another opportunity to present their case before the AO/CIT(A) when non-receipt of notices is claimed due to technical reasons like spam folders.
Sections Cited
144, 69A, 143(3)
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Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & SHRI S.R.RAGHUNATHA
आदेश / O R D E R
PER ABY T. VARKEY, JM:
1. This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, dated 09.12.2024 for the Assessment Year (hereinafter referred to as "AY”) 2017-18.
At the outset, the Ld.AR of the assessee brought to our notice that the Ld.CIT(A) has passed ex parte order qua assessee since the assessee didn’t respond to his notices, therefore, he prays for one more opportunity. Further, he also pointed out that assessment has also been framed u/s.144 of the Income Tax Act, 1961 (hereinafter referred to as "the Act”) [best judgment assessment]. According to the Ld.AR, the assessee was not able to participate before the AO, because, the notices got delivered in the ‘spam’ account of the assessee and therefore, assessee was not aware of such notices, which resulted in the AO framing ex parte order and therefore, prayed for one more opportunity before the AO by relying on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC).
Per contra, the Ld.DR doesn’t want us to give one more innings to the assessee since the assessee didn’t comply with the notices issued by the AO/Ld.CIT(A).
Having heard both the parties and after perusal of the records, we note that the Ld.CIT(A) has passed ex parte order, because, the assessee didn’t respond to his three (3) notices and finding no response from the assessee he has dismissed the appeal of the assessee without going into the merits of the addition. Likewise, the AO is noted to have issued several notices which the assessee states to have not received which resulted in the AO framing ex parte order [order u/s.144 of the Act] by adding the entire cash deposits during the demonetization period u/s.69A of the Act i.e. Rs.18,82,500/- and computed the business income at 8% of the balance deposits of Rs.3,29,36,036/- i.e. Rs.26,34,883/-. Thus, made a total addition of Rs.45,17,383/-. Since the assessee has pleaded non-receipt of the notices either by post or by e-mail and has filed an affidavit to state so, we are inclined to give one more opportunity to the assessee in view of the undertaken given by the Ld.AR of the assessee, Shri T.S.Lakshmi Venkatraman, whose e-mail ID is:
tslakshmivenkataraman@yahoo.co.in who has undertaken to appear/file all relevant documents before the AO.
In the light of the aforesaid discussion, we set aside the impugned order of the Ld.CIT(A) and restore the assessment back to the file of the AO and direct him to frame de novo assessment in accordance to law after hearing the assessee. Since there is negligence on the part of the assessee, cost of Rs.10,000/- is imposed which the assessee should remit to the State Legal Aid Authority, Hon’ble Madras High Court, and produce necessary proof of depositing of the same before the AO and thereafter, the AO to frame the de novo assessment after hearing the assessee in accordance to law.
Order pronounced on the 26th day of May, 2025, in Chennai.