NEW CONTAI NURSERY SCHOOL,CONTAI, PURBA MEDINIPUR vs. I.T.O., WARD - 27(1), HALDIA, PURBA MEDINIPUR

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ITA 1420/KOL/2024Status: HeardITAT Kolkata13 February 2025AY 2017-2018Bench: Shri Duvvuru RL Reddy (Vice President)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal set aside the order of the CIT(Appeals) to provide the assessee with one more opportunity to be heard by the Assessing Officer, emphasizing compliance with future proceedings.

What were the facts?

The assessee, a Nursery School, deposited a significant amount in bank accounts during the demonetization period but failed to file an income tax return for AY 2017-18. Despite notices and opportunities, the assessee did not comply, leading to an assessment under Section 144 based on available information.

What were the issues?

Whether the assessee was provided sufficient opportunity to represent its case before the revenue authorities, and whether the principle of natural justice was adhered to.

Which sections of the Income-tax Act were involved?

Section 139,Section 142(1),Section 133(6),Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA

Before: Shri Duvvuru RL Reddy, Vice-(KZ)

Appearances by: Shri Miraz D. Shah, A.R., appeared on behalf of the assessee Shri Somnath Das Biswas, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: January 21, 2025 Date of pronouncing the order: February 13, 2025 O R D E R

The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 1st May, 2024 passed for Assessment Year 2017-18.

(A.Y. 2017-2018) New Contai Nursery School

2.

Brief facts of the case are that the assessee is a Nursery School. On the basis of data analytics and information gathered during the phase of online verification under ‘Operation Clean Money” by the Income Tax Department, it is found that the assessee has deposited cash of Rs.26,32,210/- in bank accounts during demonetization period (9th November, 2016 to 30th December, 2016), but has not filed income tax return for A.Y. 2017-18. Notices under section 139 and 142(1) were issued and served on the assessee. The assessee failed to comply with the return. During the course of assessment proceedings, notice under section 133(6) of the Income Tax Act was issued to the Contai Cooperative Bank, Main Branch, Purba Medinipur calling for the relevant details of the assessee and the statements of all the bank accounts maintained by the assessee along with the details of all the Bank accounts. In response to the notice under section 133(6) issued to the Bank, the Bank sent the details of accounts informing cash deposits of Rs.7,90,310/- and Rs.32,95,090/- were made during the demonitzation period and whole year i.e. F.Y. 2016-17 respectively. Due to non-compliance by the assessee, the ld. Assessing Officer has left with no alternative but to assess the income of assessee on the basis of information/data available on the records and the assessment was completed under section 144 assessing the total income at Rs.32,95,090/- as unexplained money of the assessee. On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals).

(A.Y. 2017-2018) New Contai Nursery School 3. The ld. CIT(Appeals) has given several opportunities to the assesese to substantiate its claim, but the appellant did not file the written submissions and did not represent the case before the ld. CIT(Appeals). Thereafter the ld. CIT(Appeals) dismissed the appeal on 1st May, 2024.

4.

On being aggrieved, the assessee preferred an appeal before the ITAT.

5.

At the time of hearing, it was the submission of the ld. Counsel for the assessee that ld. CIT(Appeals) did not consider the case on merit, rather he just upheld the order passed by the ld. Assessing Officer. Therefore, he pleaded to delete the addition made by the ld. Assessing Officer as confirmed by the ld. CIT(Appeals).

6.

At the outset, ld. D.R. brought to my notice that the assessee did not produce the relevant documents as asked by the ld. Assessing Officer during the assessment proceedings. Therefore, the ld. Assessing Officer passed the assessment order assessing the taxable income at Rs.32,95,090/-. Thereafter the assessee preferred an appeal before the ld. CIT(Appeals). The ld. CIT(Appeals) has given many opportunities to the assessee and the assessee neither filed written submission nor any evidence before the ld. CIT(Appeals). He further submitted that before the ITAT, the assessee did not substantiate its claim. Therefore, he pleaded to uphold the orders passed by the revenue authorities.

(A.Y. 2017-2018) New Contai Nursery School 7. I have heard the rival submissions and perused the material available on record. Considering the facts and circumstances of the case, I am inclined to set aside the order passed by the ld. CIT(Appeals) in order to meet the principle of natural justice, and remit the matter back to the file of ld. Assessing Officer with a direction to provide one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. Assessing Officer failing which the Ld. Assessing Officer shall be at liberty to pass appropriate order in accordance with law and merits based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes.

8.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 13/02/2025.

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