JAYAKUMAR,KANCHIPURAM vs. ITO, WARD-1,, KANCHIPURAM
What did the Tribunal hold?
The Tribunal condoned the delay in filing the appeal due to COVID-19 and accepted the assessee's plea of not receiving notices. Respecting the principles of natural justice, the Tribunal set aside the impugned order and restored the matter to the AO for a de novo assessment.
What were the facts?
The assessee, an individual and dealer of airtel recharge services, failed to file a return of income for AY 2017-18. The AO made ex-parte additions based on cash deposits during demonetization and business income. The CIT(A) also confirmed the AO's order ex-parte.
What were the issues?
Whether the assessee was prevented by sufficient cause from appearing before the appellate authorities and whether the ex-parte assessment order should be set aside on grounds of natural justice.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI
Before: SHRI MANU KUMAR GIRI & SHRI JAGADISH
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 14.12.2022 for Assessment Year 2017-18. 2. The registry has noted delay of 682 days in filing the respective appeal. Considering the covid-19 pandemic and also reasons stated in the affidavit by the Assessee, we condone the delay and treat the reasons as ‘sufficient cause’ and admit the appeal for adjudication. 3. Brief facts are as under:
The assessee is an individual, who is a dealer of airtel recharge services earning commission income. The assessee has not filed any return of income for the year under consideration. It is noticed that during demonization period, assessee had made cash deposits. Therefore, the AO sent notices u/s.142(1) & 142 of the Act to the assessee, but assessee failed to respond to the same. In fact, AO made ex-parte assessment order by making an addition of Rs.50,000/- on account of cash deposits during demonetization in the assessee bank account treating as unexplained cash deposits u/s 69A of the Income Tax Act, 1961 and further made an addition of Rs.10,28,048/- on account of Business Income (8% of turnover) on estimate basis. Assessee further challenged the order of assessment u/s 144 of the Act before the ld.CIT(A), who proceeded ex-parte and confirmed the order of the AO on merits.
Aggrieved, assessee is in appeal before us.
Before us, the ld. Counsel for assessee submitted that the CIT(A) has sent the 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 addition on account addition gross profits. The ld.DR stated that the assessee has defaulted 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. Even, assessment has been done ex-parte. Accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. AO for de novo assessment hearing, 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 fresh assessment hearing after affording proper opportunity of hearing to the assessee. The assessee is directed to substantiate its case with all evidence and documents etc. if any, forthwith without any fail, failing which Ld.AO shall be at liberty to proceed with the assessment proceedings as per law. The ld. AR, who appeared also assured the bench that he will ensure that the assessee will prosecute his case diligently before the ld.AO.
In the result, appeal filed by the assessee is allowed for statistical purpose.
More judgments on Section 142(1)
- Sar Business Tradelink Private Limited… vs Income Tax Officer, Ward - 1(2), RaipurITA 599/RPR/2026[2014-15]Status: Heard21 Oct 2026AY 2014-15
- Subhash Chand Saini, Jaipur vs ITO Ward, Behror, BherorITA 36/JPR/2023[2017-18]Status: Disposed21 Oct 2026AY 2017-18
- Hemal Paresh Madeka, Rajkot vs Asst.Commissioner of Income Tax…ITA 955/RJT/2026[2020-21]Status: Disposed19 Oct 2026AY 2020-21
- Venish Vinodray Lalani, Rajkot vs Income Tax Officer, MorbiITA 197/RJT/2026[2019-20]Status: Disposed19 Oct 2026AY 2019-20
- Gaurav Jiteshbhai Joshi, Rajkot vs Income Tax Officer, Ward 1(1)(1), RajkotITA 1000/RJT/2026[2022-23]Status: Disposed19 Oct 2026AY 2022-23
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