M/S. EMERALD PROPERTIES PVT. LTD. ,KOLKATA vs. ITO, WARD- 13(2), KOLKATA, KOLKATA

Brief facts of the case of the assessee are that the assessee company filed his return of income declaring total income at Rs. 35,220/-. The case was selected for Assessment Year: 2012-13 M/s Emerald Properties Pvt. Ltd. scrutiny, notices u/s 143(2) was served. The assessee has also been show caused as there was non-compliance of the notice u/s 142(1), there was also non-compliance in attending the hearing instead of personal appearance as against the notices u/s 131 of the Act., the AO find that during the FY 2011-12 the assessee company made a cash deposit of Rs. 2,44,000/- and Rs. 2,00,000/- in Union Bank of India as the assessee did not come forward to produce the books of account and/or explaining the bank book such cash deposit remained unexplained. The AO further observed from the balance sheet and list of parties to whom advance was given credit to Rs. 57,23,000/- as on 31.03.2011 and got reduced to Rs. 34,73,000/- by way of repayment of advance received by the assessee company. The identity of parties, genuineness of transaction and creditworthiness of the party to pay the amount remained unexplained. The AO further find the new head current liabilities of the balance sheet. It is observed that the assessee has increased the advances from Rs. 25,00,000/- to Rs. 1,44,50,000/-. The assessee never appeared to produce the books of account, as a result of which, the amount of Rs. 1,19,50,000/- added back to the total income of the assessee u/s 68 of the Act. The AO has assessed the income of the assessee as follows:

The said order has been challenged by the assessee before the Ld. CIT(A) wherein the appeal of the assessee has been dismissed by holding that the assessee opted for VSVS scheme vide application dated 31.03.2021.

The Ld. Counsel of the assessee challenges the very impugned order, thereby submitting that the Ld. CIT(A) failed to appreciate that the assessee’s application under the VSVS Scheme vide declaration dated 31.03.2021 was in fact against the penalty order passed by the AO on 30.09.2015. The Ld. Counsel submits that there was no application filed by the assessee against the said order before the Ld. CIT(A). The Ld. Counsel further submits that the assessee could not be able to appear before the AO to substantiate his claim. He has filed papers in two sets in P.B1 and P.B 2, details of which are as follows:

On perusal of the order of AO there is no denying to this fact that it has been passed in absence of the assessee. The Ld. CIT(A) has also dismissed the appeal of the assessee by holding that the assessee opted for VSVS Scheme. The assessee has clearly stated that he filed application under VSVS Scheme against the penalty order not against the order passed by the AO on 29.03.2015. Before us, the assessee has filed bunch of papers and also given a certificate that the paper book submitted by the assessee contains the new documents which were not filed before the authorities below. In the interest of justice, we are inclined to give an opportunity to the assessee to place his case before the AO. Accordingly, the order was passed by the AO confirmed by the Ld. CIT(A) is hereby set aside. The assessee has been given an opportunity to place all these papers which he filed before us before the A.O. The AO is directed to pass a fresh order and after hearing the assessee and going over the documents.