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Facts
The assessee filed two appeals for Assessment Years 2014-15 and 2016-17. The Assessing Officer (AO) made an addition of Rs. 28 Lakhs on account of unaccounted cash payment for property purchases. The assessee argued that they were not provided sufficient opportunity by the AO and CIT(A), and the orders were passed ex-parte.
Held
The Tribunal noted that the orders were passed ex-parte due to non-compliance with notices. In the interest of natural justice, the assessee was given another opportunity to present their case before the AO, subject to payment of costs.
Key Issues
Whether the assessee was denied a fair opportunity to present their case before the AO and CIT(A) leading to ex-parte orders? Whether the matter should be remitted back to the AO for denovo adjudication?
Sections Cited
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Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI
Before: SHRI MANU KUMAR GIRI & SHRI JAGADISH
आदेश / O R D E R
PER JAGADISH, A.M : Aforesaid two appeals filed by the assessee for Assessment Years (AYs) 2014-15 & 2016-17 arises out of the orders of Learned Commissioner of Income Tax (Appeal), Chennai-18 [hereinafter “CIT(A)”] dated 19.11.2024.
& 128/Chny/2025 :- 2 -:
The facts in both the appeals of the assessee are identical and issues are common and hence, we proceed to pass a common order.
A.Y 2014-15 as lead case.
The A.O has made addition of Rs. 28 Lakhs on account of unaccounted cash payment respect of purchase of two properties on 04.01.2014 and 28.01.2014 on the basis of statement of Shri Tallam Umasankar Guptha recorded during search in the case of Shri Polisetty Venkata Sreenivasa Rao at Chennai. The A.O has made addition on the ground that the assessee has not given any explanation for the show cause notice regarding on money payment.
Aggrieved, the assessee filed an appeal before Ld. CIT(A). However, the Ld. CIT(A) passed an ex-pare order dismissed the assessee appeal stating that assessee has not made any attempt to explain the source of unaccounted payments.
The Ld. A.R has contended that sufficient opportunity was not provided to the assessee either before A.O or before Ld. CIT(A) and both the orders have been passed ex-pare and therefore, the case may be remitted back to the A.O for fresh consideration in the interest of justice.
& 128/Chny/2025 :- 3 -:
The Ld. Departmental Representative (DR), on the other hand, has relied on the orders of lower authorities.
We have heard the rival submissions, and perused the materials available on record. We find that the orders of AO and Ld. CIT(A) have been passed ex-parte due to non compliance of notices by the assessee. We are of the opinion that keeping in view the principles of natural justice, the assessee be provided with another opportunity of hearing to substantiate his case before A.O subject to payment of costs of Rs.5,000/-. The same shall be paid by the assessee to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras within a period of one month from the date of receipt of this order and produce the receipt before the A.O. Accordingly, we set aside the orders passed by the A.O and the Ld. CIT(A) and remit the matter back to the file of the A.O for denovo adjudication. We also direct the assessee to appear before the A.O on the date of hearing without fail and furnish complete details for fresh consideration. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.
& 128/Chny/2025 :- 4 -:
We find that the identical issue is involved in assessee’s appeal for A.Y 2016-17 also and accordingly, our adjudication above in A.Y 2014-15 applies mutatis mutandis to this appeal as well. Therefore, for similar reasons, we remit the matter back to the file of the A.O for denovo adjudication subject to payment of costs of Rs.5,000/-. Accordingly, the appeal filed by the assessee in is allowed for statistical purposes only.
In the result, both the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced on 26th March, 2025.