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Facts
The assessee's appeals were directed against the order of the CIT(A) for Assessment Year 2016-17, arising from an order passed under Section 144 r.w.s. 144B of the Income Tax Act. There was a delay in filing the appeals, which was condoned by the Tribunal. The legal grounds challenging the validity of the assessment proceedings due to limitation were not pressed. The core issue involved additions for alleged unexplained cash deposits.
Held
The Tribunal condoned the delay in filing the appeals. While the legal grounds regarding limitation were not pressed, the Tribunal restored the matter on merits to the Assessing Officer for a de-novo assessment. This was due to the assessment order being passed ex-parte, the non-consideration of assessee's submissions, and the prevailing Covid-19 circumstances. The assessee was granted an opportunity to explain the source of cash deposits.
Key Issues
Whether the assessment proceedings were validly conducted considering the notice served after the prescribed date and whether the additions for unexplained cash deposits were justified without considering the assessee's submissions.
Sections Cited
144, 144B, 148, 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, SMC BENCH, PUNE
Before: Dr. MANISH BORAD
Assessee by : Shri Prasad Bhandari Revenue by : Shri Aviyogi Ambadkar, Addl. CIT Date of hearing : 13.03.2025 Date of pronouncement : 19.03.2025 आदेश/ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
This appeal at the instance of the assessee is directed against the order of Ld. CIT(A) (NFAC) dated 26.09.2024 for Assessment Year 2016-17 which is arising out of the Order passed u/s 144 r.w.s. 144B of the Income Tax Act 1961 dated 28.03.2022.
There is a delay of 17 days in filing of the instant appeals. On perusal of the application for condonation of delay I notice that the said delay has arised due to non communication of impugned oder to assessee as it was e-mailed on the e-mail id of the previous consultant. After hearing Ld. DR and considering the facts of the case I condone the delay in filing of the instant two appeals and admit them for adjudication.
Assessee has commonly raised following grounds of appeal:-
1. On the facts and in the prevailing circumstances of the case and in Law, Respected CIT(A) NFAC erred in confirming the addition made in the assessment order passed by the Ld. Assessing Officer without considering the fact that the notice under section 148 is issued on 01.04.2021 but the Ld. Assessing Officer failed to follow the procedure as laid down in section 1448 of the Act under the new regime thereby making the assessment order null and void. Hence, the impugned order may please be set aside and the addition confirmed therein may please be deleted.
2. Without prejudice to the above ground-On the facts and in the prevailing circumstances of the case and in Law, Respected CIT(A) NFAC erred in confirming the addition made in the assessment order passed by the Ld. Assessing Officer without considering the fact that the Ld. Assessing Officer has issued the notice under section 148 without any verification and on the basis of assumptions and surmises only. Hence, the impugned order may please be set aside and the addition confirmed therein may please be deleted.
3. Without prejudice to the above grounds - On the facts and in the prevailing circumstances of the case and in Law, Respected CIT(A) - NFAC erred in confirming the addition made in the assessment order passed by the Ld. Assessing Officer without considering the fact that the Ld. Assessing Officer has made the addition of Rs. 41,69,040 without applying best of his judgement as whole of the cash deposited into the bank account may not be the income of the assessee. Hence, the impugned order may please be set aside and the addition confirmed therein may please be deleted.
The Appellate craves the permission to add, amend, modify, alter, revise, substitute, delete any or all grounds of the appeal, if deemed necessary at the time of hearing of the appeal.
4. At the outset Ld. counsel for the assessee requested for not pressing legal grounds challenging the validity of the assessment proceedings being bared by limitation claiming that the notice u/s 148 which was sent by the A.O. on 31.03. 2021 but was served to the assessee on 01.04.2021 and that since the last date of serving the notice u/s 148 was 31.03.2021 but the notice being served on 01.04.2021, therefore assessment proceedings are invalid. However since Ld. counsel for the assessee has not pressed the common legal grounds we dismiss common grounds No. 1 and 2 raised in the instant two appeals as not passed.
5. So far as merits of the case are concerned the common issue is against addition of Rs. 41,69,040/- and Rs. 30,92,413/- for alleged unexplained cash deposit, Ld. counsel for the assessee referring to the Paper Book submitted that the assessment order has been passed ex-parte and even the details explaining the alleged cash deposit were provided to the A.O. The same has not been considered prior to passing the assessment order. Ld. counsel for the assessee stated that the issue of merit for the alleged unexplained cash deposit needs to be restored to the file Ld. Jurisdictional Assessing Officer (JAO). On the other hand Ld. DR was fair enough for not opposing this request of Ld. counsel for the assessee but stated that some cost should be levied upon the assessee for not making proper compliance during the assessment proceedings.
I have heard rival contentions and perused the record placed before us. The assessee is an individual and is carrying out the business in the name of Indira Ice Factory. Based on the information about cash deposits in account with Shri Renuka Mata Multi State Urban Co-operative Credit Society Ltd. (SRMSCS) for the impugned two assessment orders, the scrutiny proceedings were carried out. However, the notice of hearing u/s 142(1) sent on four dates were all failing during Covid-19 period running from April, 2020 to March, 2022. The assessment orders framed on 28.03.2022 but the submissions filed by the assessee on 16.03.2022 were not considered while framing the assessment order. Considering the situation arising out of Covid-19 and the submissions of assessee being not considered by Ld. A.O., I deem it appropriate to restore the matter on merits for both the impugned assessment years to the file of the Ld. JAO for carrying out de-novo assessment proceedings for which a fair opportunity of being heard shall be granted to the assessee to furnish necessary details to explain the source of alleged cash deposits and then Ld. JAO can decide in accordance with law. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Effective grounds of appeal raised by assessee on merits for A.Y. 2016-17 and 2017-18 are allowed for statistical purposes.
In the result both the appeals of the assessee are partly allowed for statistical purposes. Order pronounced on this 19th day of March, 2025.