ARULDOSS JOHNSON SUGIRTHARAJ,KRISHNAGIRI vs. ITO, WARD-1, , KRISHNAGIRI

The captioned appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals)(NFAC) Delhi [CIT(A)] dated 14.11.2024 for Assessment Year 2017-2018.

Brief facts are as under: In fact, AO made ex-parte an addition of Rs.19,87,000/- on account of cash deposits during demonetization in the assessee bank account treating as unexplained investment u/s 69 of the Income Tax Act, 1961 and further made an addition of Rs.11,59,157/- as unaccounted business income.

Before us, the ld. Counsel for assessee submitted that the CIT(A) has sent the three notices which were not received by the assessee, hence the assessee was prevented from appearance on the purported dates. Therefore, he prayed that the assessee may be provided an adequate and proper representation time to file evidence and documents, if any, to substantiate his explanation regarding cash deposits during demonetization and purported unaccounted business receipts. The ld.DR stated that the assessee is habitual defaulter in appearing before the appellate authority hence no lenient view is to be taken in this case and prayed for dismissal of appeal.

Though we concur with the submissions of Ld. Sr. DR however, keeping in mind the principle of natural justice and grant another opportunity of hearing to the assessee. We also find that assessee has not represented before the ld.CIT(A) despite notices for the reasons stated above. We also note that even before AO the order is ex-parte. Accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. AO for denovo assessment on merits after affording proper opportunity of hearing to the assessee subject to cost of Rs.5,000/- which shall be deposited by the assessee within 30 days from the date of receipt of this order to ‘Tamil Nadu State Legal Services Authority’ at Hon’ble High Court of Madras. The proof of the same will be furnished by the Assessee before Ld.AO whose shall proceed for denovo assessment after affording proper opportunity of hearing to the assessee. The assessee is directed to substantiate its case with all evidence and documents regarding cash deposits during demonetization and purported unaccounted business receipts, if any, forthwith without any fail, failing which Ld. AO shall be at liberty to proceed with the assessment proceedings on merits as per law. The ld. counsel, who appeared through virtual mode also assured the bench that he will ensure that the assessee will prosecute his case diligently.