Loading judgment…
Facts
The assessee filed an appeal against the order of the CIT(A) which dismissed the appeal as withdrawn. The assessee had filed an application under the Vivad se Vishwas Scheme (VSVS) for settlement of tax arrears, but the withdrawal letter was inadvertently related to a penalty order and not the quantum appeal. The revenue representative accepted the assessee's contention.
Held
The Tribunal noted that the assessee had availed the benefit of the DTVSV scheme for the penalty, but the impugned appeal was against the assessment order. Consequently, the Tribunal set aside the order of the CIT(A) and remanded the case for denovo adjudication, providing an opportunity to the assessee.
Key Issues
Whether the appeal was rightly dismissed as withdrawn due to an inadvertent filing of a withdrawal letter under the VSVS scheme, and if the additions made by the Assessing Officer on various grounds were justified.
Sections Cited
250, 143(3), 272A(1)(c), 56(2)(vii)(b), 41(1), 88, 147, 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “SMC” :: PUNE
Before: MS.ASTHA CHANDRA & DR.DIPAK P. RIPOTE
Assessment Year: 2015-16 Kailashchandra Haumanprasad V The Income Tax Officer, Sugla, s Ward-1(1), Solapur. 45/15, Samrat Chowk, Budhwar Peth, Prabhakar Nagar H/S, Solapur-413001. Maharashtra. PAN: AHSPS3244B Appellant/ Assessee Respondent / Revenue Assessee by Shri Pramod S Shingte – AR Revenue by Shri Sandeep P Sathe – JCIT(DR) Date of hearing 16/07/2025 Date of pronouncement 29/07/2025 आदेश/ ORDER
PER DR. DIPAK P. RIPOTE, AM:
This is an appeal filed by Assessee against the order of ld.Addl./Joint Commissioner of Income Tax(Appeal)-3, Chennai passed under section 250 of the Income Tax Act, 1961 for the A.Y.2015-16dated 12.10.2023, emanating from order u/s.143(3) of the Income Tax Act, 1961, dated 26.12.2017. The Assessee has raised following grounds of appeal :
“1. On the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in passing order u/s 250, wherein, appeal was dismissed as withdrawn, without verifying the details of withdrawal letter which specifies the fact that the appeal which was withdrawn was arising out of penalty order passed u/s 272A(1)(c), for which an application under DTVSV Scheme 2020 was preferred, whereas for quantum appeal there was no such application made under DTVSV scheme. Due to inadvertent filing of withdrawal letter the quantum appeal was dismissed, therefore appellant prays for restoring the appeal back to the file of NFAC Without prejudice to the above grounds following grounds are taken on merit:
On the facts and circumstances of the case the Learned Assessing Officer erred in making an addition of Rs.12,27,480/- by invoking provisions of Sec 56(2)(vii)(b) by disregarding appellant's contention that said land is purchased by the appellant as stock in trade therefore provisions of Section 56(2)(vii)(b) are not applicable, therefore the entire addition needs to be deleted
On the facts and circumstances of the case the Learned Assessing Officer erred in making an addition of Rs.5,77,731/- by invoking provisions of Sec 41(1) being amount payable to Shri Sugala Ravinkumar Kailashchandra, Appellant's son Rs.4,82,731/- and Shri Kailashchandra H Sugala Prop. K.H. Sugala Powerloom unit Rs.95,000/-on account of loans and advances obtained in earlier years. Since this outstanding amount is not arising out of any trade liabilities, addition u/s 41(1) is uncalled for and deserves to be deleted
On the facts and circumstances of the case the Learned Assessing Officer erred in making an addition of Rs.9,25,000/- by invoking provisions of Sec 88 being advances received from Ravinkumar Sugala Rs 10,000/-, Shri S C Sugala Rs.9,00,000/- and Shri Sagar Govind Marda by treating it as fake without considering the fact that necessary supporting evidences are brought on record by appellant, the action of making addition perverse ad needs to be struck down
5. On the facts and circumstances of the case and in law the Learned Assessing Officer erred in making an addition of Rs.1,14,822/- by treating agriculture income as income from other sources by disregarding appellant's contention and documentary evidences brought on record.
On the facts and circumstances of the case and in law the Learned Assessing Officer erred in passing the order u/s 143(3) of the Income Tax Act, 1961 dated 26.12.2017, although the case was selected for limited scrutiny under CASS to verify the point of purchase of property, however learned Assessing officer has made various other additions without converting the same into a complete scrutiny and it appears that he has not obtained necessary sanction for same therefore assessment order passed is bad in law.
Your appellant prays for deletion of entire addition. Your appellant craves for to add, alter amend, modify, delete any or all grounds of appeal before or during the course of hearing in the interest of principle of natural justice.
Submission of ld.AR : 2. The ld.Authorised Representative(ld.AR) for the Assessee filed a paper book containing 20 pages. Ld.AR took us through the page no.1 to 15 of the paper book which were copies of the Form Nos.1, 2, 3, 4 and 5 filed under Direct Tax Vivad se Vishwas Scheme(DTVSV).
Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue accepted the contention of the ld.AR for the Assessee.
Findings & Analysis : 4. We have heard both the parties and perused the records. It is observed that ld.CIT(A) has dismissed the appeal of the assessee stating that Assessee had filed application under DTVSV. The relevant paragraphs1, 2 and 3 of the ld.CIT(A)’s are reproduced here as under : “This appeal was instituted by the appellant on 26.01.2018 against the order dated 26.12.2017 passed u/s 143 (3) of the Income-tax Act, 1961 by AO, WARD 1 (1) SOLAPUR for the A.Y.2015-16. The appeal was originally migrated to the National Faceless Appeal Centre (NFAC) in terms of Notification No.76 of 2020 in S.O.3296(E) dated 25.09.2020 issued by CBDT, New Delhi. Subsequently, the aforesaid appeal filed by the appellant was transferred to JCIT(Appeals) vide e- Appeals Scheme as notified by CBDT vide notification no. 33/2023 dated 29.5.2023.
2 During the pendency of appeal proceedings, the appellant has opted for Vivad Se Viswas Scheme (VSVS), 2020 and has since been issued order in Form No.5 for full and final settlement of tax arrears under section 5(2) read with section 6 of the Direct Tax Vivad Se Viswas Act, 2020 (3 of 2020) by PCIT vide Acknowledgement No.810755111111121 dated 11.11.2021 certifying therein that a sum of Rs. 10000 has been paid by the declarant towards full and final settlement of tax arrears determined in the order No.245819700080221 dated 08.02.2021.
3 Keeping the above facts in view, appeal filed by the appellant against the order dated 26.12.2017 passed u/s 143 (3) of the Income-tax Act, 1961 by AO, WARD 1 (1) SOLAPUR or the A.Y2015-16 is deemed to have been withdrawn by the appellant in terms of the VSVS and accordingly, the appeal is hereby dismissed as withdrawn.”
4.1 It has been brought to our notice by ld.AR that assessee has filed application under DTVSV with respect to penalty of Rs.10,000/- for A.Y.2015-16. We have perused the copies of the Form No.1, 2, 3, 4 and 5 which are at page no.1 to 15 of the paper book. We are convinced that Assessee had availed benefit of DTVSV for the penalty. The scanned copy of Form No.5 is reproduced here as under :
Ld.DR for the Revenue has also accepted the fact that Assessee had availed benefit of DTVSV for the penalty, whereas impugned appeal was against the assessment order passed u/s.143(3) of the Act.
6. In these facts and circumstances of the case, we set-aside the order of ld.CIT(A) to ld.CIT(A) for denovo adjudication. Ld.CIT(A) shall provide opportunity to the assessee. Assessee shall file all the necessary documents before the ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose.
In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 29 July, 2025.