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Facts
The assessee is in appeal against the order of the Ld. CIT(A) who affirmed the additions made by the Ld. AO. The additions were on account of alleged unexplained cash deposit, investment from undisclosed sources, and an addition under Section 56(2)(vii)(b)(ii) of the Income Tax Act. The assessee's primary contention is that the Ld. CIT(A) decided the appeal ex-parte without affording proper opportunity of hearing.
Held
The Tribunal noted that the assessee alleged denial of adequate opportunity of hearing. While the impugned order mentioned several opportunities, the Tribunal, in the interest of substantive justice, felt it appropriate to remand the matter back to the first appellate authority. The Ld. Addl./JCIT(A) was directed to provide an adequate opportunity of being heard to the assessee.
Key Issues
Whether the Ld. CIT(A) erred in deciding the appeal ex-parte without providing the assessee with a proper opportunity of being heard, and whether the additions made by the AO and affirmed by the CIT(A) were based on proper appreciation of facts and evidence.
Sections Cited
250, 56(2)(vii)(b)(ii)
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Income Tax Appellate Tribunal, “B” BENCH, KOLKATA
Appearances by: Assessee represented by : Abhishek Bansal, AR Department represented by : Dheeraj, Addl. CIT, Sr.DR Date of concluding the hearing : 24.06.2025 Date of pronouncing the order : 30.06.2025 O R D E R
PER SANJAY AWASTHI, ACCOUNTANT MEMBER
This appeal arises from order passed by the Ld. Commissioner of Income Tax (Appeals), Addl./JCIT(A)-6, Chennai [hereafter “the Ld. CIT(A)”] u/s 250 of the Income Tax Act, 1961, vide order dated 24.03.2025.
1.1 In this case, the Ld. AO made several additions on account of alleged unexplained cash deposit in the bank (Rs. 17,83,100/-), alleged investment from undisclosed source (Rs. 53,24,526/-) and an addition u/s 56(2)(vii)(b)(ii) of the Act (Rs. 9,44,500/-).
1.2 Aggrieved with this action, the assessee is in appeal with the following grounds:
Shri Kaushik Chakraborty “1. For that the assessment order passed by the Ld. AO as affirmed by the Ld. CIT (A) is bad in law as well as on facts. 2. For that the Ld. CIT (A) erred in deciding the appeal exparte without allowing the appellant any proper and reasonable opportunity of being heard. 3. For that the order passed by the Ld. CIT (A) is bad in law since the Ld. CIT (A) has not decided the issues ground wise in respect of the grounds raised by the appellant in the Memo of Appeal.
4. For that the Ld. CIT (A) is bad in law since the order passed is not any speaking order nor the CIT(A) has looked into the assessment records and relevant materials to conclude that the order of the Ld. AO cannot be interfered with.
5. For that the Ld. AO erred in making addition of Rs. 17,83,100/- being cash deposited into bank account of the assessee in spite of the fact the same is deposited for payment of stamp duty, Property registration charges and Other Legal fees and the same is deposited out of past Savings and Income earned during the year.
6. For that the Ld. CIT(A) erred in affirming the addition of Rs. 17,83,100/- as unexplained cash Deposit merely based upon surmises and conjectures whereas the said deposits were made out of cash withdrawn from bank during the FY 2012- 13, FY 2013-14 and 2014-15 and were kept with the assessee.
7. For that the Ld. CIT(A) erred in confirming the action of Ld. AO in treating Rs 53,24,526/- as Investment from undisclosed sources without appreciating the fact that out of the above addition some of the payment were made in financial year 2013-14 and the evidences/details were already been on records.
8. For that even otherwise, No addition can made for the payment that actually made in earlier year(s).
9. For that the Ld. CIT(A) as well as Ld. AO erred in making addition u/s 56(2)(vii) directly on the basis of value adopted by the registering authority without referring the matter to the DVO.
10. For that the Ld. AO erred in considering the stamp duty on the date of registration of the property instead of the date on which the property was booked by the assessee and agreement for purchased was entered Into:
11. For that the Ld. CIT(A) erred in confirming the action of Assessing Officer in assessing Rs. 9,44,500/- u/s 56(2)(vii)(b)(il) of the Income Tax Act, 1961 being difference of stamp duty value and actual consideration in spite of the fact that the same is duly falls under the tolerance band of 10%.
12. For that even otherwise, The Ld. AO have duly accepted the fact that the property were purchased by the assessee and The Ld. AO also not disputed the facts that the assessee have taken loan from the financial institution/LIC for Purchase of property.
13. For that under the facts and circumstances of the case, the additions made by the Ld. AO the as affirmed by the Ld. CIT(A) are based on non-consideration of submission of the assessee and incorrect appreciation of facts and are merely based on upon surmises, conjectures and without any adverse material being brought on record.
Shri Kaushik Chakraborty 14. For that even otherwise, the addition made by the Ld. AO merely disbelieving the evidences adduced by the assessee without affording any real opportunity of being heard is bad in law. 15. For that under the facts and circumstances of the case, the addition made by the Ld. AO is liable to be deleted. 16. For that the appellant craves leave to add, alter or withdraw any grounds of appeal on or before hearing of the appeal.”
2. Right at the outset, the Ld. AR vehemently argued that the Ld. JCIT(A) passed the impugned order without affording any opportunity of being heard and the assessee’s request for adjournment was turned down and an exparte order was passed. He assailed the action of the Ld. Addl./JCIT(A) by stating that he did not appreciate the factual matrix of the case and passed an exparte order.
2.1 The Ld. DR relied on the orders of authorities below.
We have carefully considered the rival submissions and have also gone through the records before us. We find that on pages 2 and 3 of the impugned order it is mentioned that 4 opportunities of hearing were provided to the assessee and even after providing an opportunity for personal hearing there was allegedly no response from the side of the assessee. Be that as it may, we feel that in the interests of substantive justice, this matter deserves to be remanded back to the file of the first appellate authority, after setting aside the impugned order. Needless to say, the Ld. Addl./JCIT(A) would provide an adequate opportunity of being heard to the assessee and the assessee would do well to avail of such an opportunity.
In result, appeal of the assessee is allowed for statistical purposes.
Order pronounced on 30.06.2025