SANJAY SHAMRAO SAWANT,NAVI MUMBAI vs. INCOME TAX OFFICER, WARD 42(3)(3), MUMBAI

Briefly, the facts of the case are that the assessment in this case was completed u/s. 143(3) of the Income Tax Act, 1961 („the Act‟), vide order dt. 11-12-2018, wherein the AO has brought to tax a sum of Rs. 24,82,275/- u/s. 69A of the Act and an amount of Rs. 14,50,420/- u/s. 69 of the Act in terms of un-explained investments. The assessee thereafter carried the matter in appeal before the Ld.CIT(A), who has since dismissed the appeal on account of non-prosecution and against the said order, the assessee is in appeal before us.

Heard the Ld.DR and perused the material available on record. On perusal of the order passed by the Ld.CIT(A) it is noted that the Ld.CIT(A) has dismissed the appeal on account of non-compliance to various notices issued to the assessee. In his grounds of appeal, the assessee has contended that the notices were initially issued by Ld.CIT(A), NFAC and the appeal was ultimately disposed-off by the ADDL/JCIT(A)-Kochi without proper intimation and without providing adequate opportunity to the assessee. It was also submitted that the assessee sought adjournment from the office of the ADDL/JCIT(A)-Kochi. However, the adjournment has neither been rejected nor fresh date of hearing has been given and the Ld.CIT(A) has proceeded and passed the ex-parte order, without providing reasonable opportunity to the assessee. Further in his grounds of appeal before the Ld.CIT(A) in respect of cash deposits in various accounts maintained by the assessee, it has been contended by the assessee that 3 the AO has not given adequate opportunity to the assessee to explain the sources of cash deposits. Regarding addition of Rs. 14,50,420/-, it has been contended before the Ld.CIT(A) that the source of the said amount is out of the funds borrowed from HDFC bank and in absence of requisite opportunity from the AO, the assessee could not explain the same before the AO. We, therefore, find that both the additions have been made by the AO without giving adequate opportunity to the assessee as the assessee sought necessary opportunity to place on record the necessary documentation in support of the cash deposit in his bank account as well as provide the necessary explanation regarding the source of purchase of property, which has been claimed to be funds borrowed from the HDFC bank. Considering the entirety of the facts and circumstances of the case, we deem it appropriate to set aside the matter to the file of the AO to decide the same afresh as per law, after affording adequate opportunity of being heard to the assessee. We also direct the assessee to fully co-operate with the AO for expeditious disposal of the matter and is at liberty to file necessary explanation / documentation as so advised.

In the result, the appeal filed by the assessee is allowed for statistical purposes.