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Facts
The assessee's income tax assessment for AY 2017-18 was completed ex parte under Section 144, with additions for unexplained cash deposits during demonetization and disallowed agricultural income. The Ld. CIT(A) subsequently dismissed the assessee's appeal for non-prosecution, leading to the current appeal before the ITAT. The assessee sought condonation of delay and another opportunity to present their case, citing reasons for non-appearance.
Held
The Tribunal condoned the delay of 426 days in filing the appeal and, in the interest of justice, remanded the matter back to the Assessing Officer for fresh adjudication. This remand is conditional upon the assessee paying ₹10,000/- to the State Legal Aid Authority within 30 days, after which the Assessing Officer must consider the assessee's submissions and evidence.
Key Issues
Whether the ex parte order by the CIT(A) was justified and if the assessee should be granted a further opportunity to present their case before the Assessing Officer.
Sections Cited
144, 69A
AI-generated summary — verify with the full judgment below
Before: Shri S.S. Viswanethra Ravi & Shri Jagadish
Year: 2017-18 Kalimuthu, Vs. The Income Tax Officer, Moolakkadai South Thottam, Sokkanur Non Corporate Ward 4, Post, Kinathukadavu (vil) , Pollachi Coimbatore. Taluk, Coimbatore 642 109. [PAN:BVJPK6367B] (अपीलाथ�/Appellant) (��थ�/Respondent) अपीलाथ� की ओर से / Appellant by : Shri S. Sridhar, Advocate (Erode) ��थ� की ओर से/Respondent by : Shri A. Sasikumar, CIT सुनवाई की तारीख/ Date of hearing : 24.02.2025 घोषणा की तारीख /Date of Pronouncement : 28.02.2025 आदेश /O R D E R
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:
This appeal filed by the assessee is directed against the order dated 23.08.2023 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment year 2017-18.
We find that this appeal is filed with a delay of 426 days. The assessee filed an affidavit for condonation of delay stating the reasons. Upon hearing both the parties and on examination of the said affidavit, we find the reasons stated by the assessee are bonafide, which really prevented in filing the appeal in time. Thus, the delay is condoned and admitted the appeal for adjudication.
The assessee raised 2 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the ld. CIT(A) is justified in concluding the appellate order exparte the assessee in the facts and circumstances of the case.
4. We note that the assessee is an individual and filed his return of income admitting income of ₹.28,05,210/-. The case of the assessee was selected for scrutiny under CASS and issued statutory notices. The assessee admitted income from sale of coconuts and also claimed agricultural income of ₹.20,00,000/-. The Assessing Officer found that the assessee deposited ₹.17,00,000/- in specified bank notes (SBNs) in his bank account during demonetization period. The Assessing Officer issued show cause notice requesting the assessee to explain why the cash deposits during the demonetization period and the agricultural income admitted in the return of income should not be added to the total income of the assessee. However, there was no response from the assessee. From the bank statement, the Assessing Officer found that there were huge credits in the accounts maintained by the assessee in the South Indian Bank. As per the return of income filed by the assessee, the Assessing Officer noted that the total turnover during the year was ₹.45,91,49,784/-. However, total credit entries in the bank account is ₹.51,40,58,161/-. Further, the assessee deposited cash of ₹.17,00,000/- in his bank accounts during the demonetization period. The Assessing Officer further noted that in the return of income, the assessee claimed agricultural income of ₹.20,00,000/-, whereas, in the previous assessment year, the assessee claimed ₹.7,00,000/-. The assessee has not submitted any evidence before the Assessing Officer for the claim of agricultural income. Accordingly, the Assessing Officer completed the assessment under section 144 of the Act by making addition towards unexplained money of ₹.17,00,000/- under section 69A of the Act and disallowed agricultural income to the extent of ₹.13,00,000/-. On appeal, the ld. CIT(A) dismissed the appeal for want of prosecution.
The ld. AR Shri S. Sridhar, Advocate submits that non appearance of the assessee before the ld. CIT(A) is neither wilful nor deliberate but due to circumstances beyond its control. He also submits that there was a complete confusion, since the assessment was completed, subsequently two rectification orders dated 08.06.2023 & 21.12.2023 were passed and moreover in the impugned order, there was no adjudication of issues on merits. He also submits that since the ld. CIT(A) and the Assessing Officer passed exparte order, there was no assistance from the assessee against the additions made by the Assessing Officer and confirmed by the ld. CIT(A) and thus prayed one more opportunity may be afforded to the assessee to pursue his case before the Assessing Officer.
The ld. DR Shri A. Sasikumar, CIT opposed the same and drew our attention to para 5.2 of the impugned order and argues that the ld. CIT(A) has given ample of opportunities to the assessee, but, it was not availed. He vehemently argued that costs may be imposed in case this Tribunal afford an opportunity by remanding the matter to the file of the Assessing Officer.
Considering the facts and circumstances of the case and submissions of the ld. AR and the ld. DR, in the interest of justice, we deem it proper to remand the matter to the file of the Assessing Officer subject to the condition of payment of ₹.10,000/- in favour of the State Legal Aid Authority, Hon’ble Madras High Court within 30 days from the date of receipt of this order and the Assessing Officer shall satisfy the payment of cost and decide the issue afresh after considering the written submissions/documentary evidence as may be filed by the assessee to substantiate his claim. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes
Order pronounced on 28th February, 2025 at Chennai.