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Facts
The assessee filed their return of income and faced additions by the Assessing Officer (AO) for cash deposits and withdrawals, and on sale of land, due to failure to explain sources. The CIT(A) dismissed the appeal ex-parte as the assessee did not provide written submissions.
Held
The Tribunal held that the orders were passed ex-parte and, in the interest of natural justice, the assessee should be given another opportunity to present their case before the AO, subject to payment of costs.
Key Issues
Whether the assessee should be provided with another opportunity to present their case when the lower authorities passed orders ex-parte due to non-compliance.
Sections Cited
143(3), 144B, 69A, 69C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & SHRI JAGADISH
आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee for Assessment Year (AY) 2022-23 arises out of the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] dated 25.11.2024 in the matter of assessment framed by the Assessing Officer [AO] u/s. 143(3) r.w.s 144B of the Income-tax Act,1961 (hereinafter “the Act”) on 07.02.2024.
The assessee is an individual and filed his return of income on 31.12.2022 admitting total income of Rs. 4,58,040/-. The A.O has made addition u/s. 69A of the Act at Rs. 1,69,34,010/- of cash deposits in ICICI Bank Ltd., and of Rs. 72,25,000/- of cash withdrawal from IDBI Bank u/s. 69C of the Act . The A.O further made addition of Rs.21,15,000/- on sale of land. The A.O has made addition for the reason that the assessee has failed to explain sources of cash deposits/withdrawals. Aggrieved, the assessee preferred an appeal before Ld. CIT(A). The Ld. CIT(A) has issued three notices from 24.10.2024 to 14.11.2024 and dismissed the appeal as the assessee has not made any written submission in response to the notices issued.
The Ld. Authorized Representative (A.R) of the assessee 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 interests of justice.
On the other hand, the Ld. Departmental Representative (DR), 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 A.O as well as Ld. CIT(A) have passed the orders ex parte. 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 the A.O subject to payment of costs of Rs.10,000/-. 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.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 26th March, 2025.