MADHAVI BEERAVOLU,HYDERABAD vs. INCOME TAX OFFICER, WARD-8(1), SIGNATURE TOWERS

Aggrieved by the order of the learned CIT(A), the assessee is now, in appeal before the Tribunal.

CA, veeravenkata Satya Shiva Ryali, Learned Counsel for the Assessee submitted that, during the course of assessment proceedings, the Assessing Officer without considering the capital gains accrued on account of sale of immovable property made the impugned addition of Rs.83 lakhs in the hands of the assessee. Further, the Assessing Officer has made addition on account of cash deposits of Rs.12,16,070/- without appreciating the fact that, the cash deposits were made by the assessee out of the previous withdrawals and amounts received from the relatives of the assessee. During the course of appellate proceedings before the learned CIT(A), the assessee has contended that, she had incurred improvement cost of Rs.36,55,000/- and, therefore, she is entitled for deduction of capital gains. In support of her contention, she has produced the work order engaged with M/s. Prashant Sai Builders including the notarized work order, invoices raised, bank payments for the same. Further, with respect to addition made u/sec.69A of the Act, the Learned Counsel for the Assessee contended that, the Assessing Officer has treated the entire bank credits of Rs.71,87,285/- as turnover of the assessee and applying 8% as business profits on the above bank credits, without appreciating the fact that, the assessee has received substantial amounts in the bank from her daughter, relatives and proceeds from bank loan obtained for the property. However, the learned CIT(A) without considering the submissions of the assessee on merits, simply dismissed the appeal of assessee on account of delay in filing the appeal before the learned CIT(A), although, the assessee has explained ‘sufficient and reasonable cause’. He, therefore, submitted that, in the interest of justice, the matter may be set-aside to the file of learned CIT(A) for afresh adjudication.

Sri Gurpreet Singh, learned DR for the Revenue, on the other hand, strongly relied on the orders of the authorities below. He submitted that, during the course of assessment proceedings, the Assessing Officer has given various opportunities to substantiate her claim by issuing statutory notices and show cause notice. However, the assessee did not chose to respond to the said notices. Therefore, the Assessing Officer, in absence of proper explanation from the assessee, assessed the total income of the assessee at Rs.1,00,91,053/- by making additions on account of sale of immovable property and deposits in DCB Bank Ltd., During the course of appellate proceedings before the learned CIT(A), firstly, the assessee had filed the appeal with a delay of 177 days and failed to explain day-to-day delay with ‘reasonable and sufficient cause’. Therefore, the learned CIT(A), in absence of proper explanation from the assessee, has rightly dismissed the appeal of the assessee and upheld the order of the Assessing Officer. He, therefore, submitted that, the order of the learned CIT(A) should be upheld.

We have heard both the parties, perused the material on record and the orders of the authorities below. We find that, admittedly, there is no dispute between the parties that, the Assessing Officer has passed ex-parte assessment order and assessed the income of the assessee at Rs.1,00,91,053/- by making additions on account of sale of immovable property amounting to Rs.83 lakhs and cash deposited into DCB Bank Ltd., amounting to Rs.12,16,070/-. During the course of appellate proceedings, in response to notice issued by the learned CIT(A) u/sec.250 of the Act, the assessee has filed submissions dated 02.05.2025 which is evident from page 78 of the paper book. However, the learned CIT(A) has dismissed the appeal of the assessee on account of delay of 177 days in filing the appeal before him. We find that, the assessee has explained the reasons for delay in filing the appeal to the effect that, her father has got hospitalized on multiple occasions and expired and produced the death certificate also before the learned CIT(A). However, the learned CIT(A) without considering the ‘reasonable and sufficient cause’ explained by the assessee with supporting medical certificates and death certificate of her father, simply dismissed the appeal of the assessee on account of delay, without deciding the appeal on merits. Since, the learned CIT(A) has dismissed the appeal filed by the assessee, without considering the submisisons of the assessee, in our considered view, the matter needs to be set-aside to the file of the learned CIT(A) to reconsider the issue after considering the relevant submissions made by the assessee. Thus, we set-aside the order of the learned CIT(A) and restore the issue back to the file of the learned CIT(A) and also direct the learned CIT(A) to reconsider the issue after providing a reasonable opportunity of hearing to the assessee. Needless to say, the assessee shall furnish relevant details as and when the appeal is posted for hearing.

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