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Facts
The assessee deposited Rs. 10.20 lakhs in cash and made time deposits in AY 2011-12 but did not file an income tax return. The AO reopened the assessment under section 148, noting total cash credits of Rs. 25,43,158/- and passed an ex-parte order treating this as unexplained money under section 69A due to the assessee's non-compliance. The CIT(A) also dismissed the assessee's appeal ex-parte for similar reasons of non-compliance.
Held
The Tribunal observed that both the AO and CIT(A) passed their orders without affording the assessee a proper opportunity to be heard. To ensure justice, the matter is remitted back to the AO for de-novo adjudication. The assessee is directed to appear before the AO and present all relevant details for the case's adjudication.
Key Issues
Whether ex-parte assessment and appeal orders are valid when the assessee was not given a proper opportunity to be heard; and the treatment of cash deposits as unexplained money under Section 69A.
Sections Cited
148, 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, B BENCH: CHENNAI
Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA
आदेश / O R D E R
PER S.R. RAGHUNATHA, A.M : This appeal filed by the assessee is directed against the order passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, [hereinafter “CIT(A)”] for the assessment year 2011-12, vide order dated 14.11.2024.
The brief facts of the case are that the assessee deposited cash of Rs. 10,20,000/- in his savings bank account and also made time deposits with City Union Bank Ltd., Pallipalayam Branch, but did not file a return of income for the relevant A.Y. 2011-12. Upon reviewing the entries in the bank statement, it was noticed that the total cash credits in the bank account amounted to Rs. 25,43,158/-. The A.O therefore reopened the assessment by issuing a notice under section 148 of the Act. However, the assessee neither filed a return of income in response to the notice nor complied with the notices issued during the assessment proceedings. The AO, therefore, passed an ex-parte order, treating the entire cash deposits of Rs. 25,43,158/- in the bank account as unexplained money under section 69A of the Act.
Aggrieved, the assessee preferred an appeal before the Ld. CIT(A).
On appeal, the Ld. CIT(A) issued notices from 12.01.2020 to 05.11.2024, but there was no compliance with the notices. Therefore, the Ld. CIT(A) also dismissed the appeal of the assessee ex-parte.
The Ld. Counsel for the assessee prayed for setting aside the order of the Assessing Officer for re-adjudication, since the case was not prosecuted before the Assessing Officer and the same has been confirmed by the Ld. CIT(A) without any discussion.
Per contra, the Ld. DR relied on the orders of the lower authorities and prayed for confirming the impugned order.
We have heard both the parties and gone through the order of the lower authorities below. It is noted that the AO and that of the Ld. CIT(A) have passed the orders without giving proper opportunity to the assessee. Therefore, to meet the ends of justice, we remit the matter back to the file of the AO for denovo adjudication. We also direct the assessee to appear before the AO and at liberty to submit the relevant details before the AO for adjudication of the case.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on 20th February, 2025.