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Facts
The assessee firm declared an income of Rs. 25,32,710/- for AY 2017-18 and the case was selected for scrutiny due to a large cash deposit during demonetization. The Assessing Officer (AO) made an addition of Rs. 1,25,25,000/- under Section 69A read with Section 115BBE of the Act. The CIT(A) confirmed the addition.
Held
The Tribunal, while noting the assessee's failure to represent before the AO and CIT(A), set aside the impugned order and restored the appeal to the AO for a fresh assessment. This was done to grant another opportunity to the assessee in the interest of natural justice.
Key Issues
Whether the assessee was provided adequate opportunity to present its case, and if not, should the case be remanded for fresh adjudication?
Sections Cited
143(2), 142(1), 69A, 115BBE, 144
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘C’ BENCH, CHENNAI
Before: HON’BLE SHRI MANOJ KUMAR AGGARWAL & HON’BLE SHRI MANU KUMAR GIRI
(िनधा�रणवष� / Assessment Year: 2017-2018) VSG Motors, Vs. The Assistant Commissioner of 1L, Gandhi Road, Income Tax, Annuppurapalayam, Circle 1, Pudur, Anupparapalayampudur, Tirupur. Tiruppur, Anuppapalayam S.O. 641652. [PAN: AAJFV 8353N] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri Badrinarayanan, Advocate ��यथ� क� ओर से /Respondent by : Ms. Aswathy, JCIT. सुनवाई क� तार�ख/Date of Hearing : 24.02.2025 घोषणा क� तार�ख /Date of Pronouncement : 24.02.2025 आदेश / O R D E R PER MANU KUMAR GIRI (Judicial Member)
This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in order No.ITBA/NFAC/S/250/2024-25/1064223620 (1) dated 19.04.2024. The assessment was framed by the Assistant Commissioner of Income Tax, Circle 1, Tirupur for the assessment year 2017-18 u/s.144 of the Income Tax Act, 1961 (hereinafter the ‘Act’), vide order dated 23.12.2019.
2. Brief facts of the case are that the assessee firm furnished its return of income on 06.12.2017 for the AY. 2017-18 declaring total income of Rs.25,32,710/-. The case was selected for scrutiny through CASS for the reason, "Large value cash deposit during demonetization". The ld. AO found that assessee had deposited in demonetization cash of Rs.1,25,25,900/-. Notice u/s. 143(2) of the Act dated 22.09.2018 was issued and served to the appellant on 26.09.2018. Further, Notice u/s 142(1) of the Act dated 21.11.2019, was issued and served to the assessee. Since, the appellant had not filed any requisite response, in the interest of justice, the ld. AO issued a final show cause notice and served on 07.12.2019. The appellant had not filed any response to the show cause notice dated 07.12.2019 also. Hence, the ld. AO made an addition of Rs.1,25,25,000/- under section 69A r.w.s.115BBE of the Act. Aggrieved, assessee preferred an appeal before the ld. CIT(A). The ld. CIT(A) issued eight notice to the assessee, since there was no response from assessee, the ld. CIT(A) confirmed the action of the Assessing Officer. Aggrieved, assessee preferred an appeal before the Tribunal.
Before us, the ld. Authorized Representative submitted that that the AO has not given sufficient time to file evidence and documents to substantiate its explanation and requested to send the appeal back to the file of the Assessing Officer for fresh adjudication. On the other hand, the ld. Departmental Representative argued that the assessee were given opportunities to substantiate its case before the ld. AO as well as the ld. CIT(A). however, assessee has not utilized the opportunity and hence he prayed that 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. AO despite notices. Accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. AO for denovo assessment after affording proper opportunity of hearing to the assessee. The assessee is directed to substantiate its case with all evidence, confirmations and documents, 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.
In the result, appeal filed by the assessee is allowed for statistical purpose.