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Facts
The assessee, an individual, did not file a return of income for AY 2013-14. Based on information of cash deposits exceeding Rs. 10 lakhs, the AO reopened the case and made an addition of Rs. 12,40,400/- as unexplained money u/s. 69A of the Act after non-compliance by the assessee.
Held
The Tribunal condoned the delay in filing the appeal due to the assessee's daughter's severe illness. The Tribunal found that the assessee did not participate in the proceedings before the lower authorities and remitted the issues on merit to the Assessing Officer for de novo adjudication.
Key Issues
Whether the appeal filed beyond the limitation period should be condoned? Whether the issues on merit should be remitted for de novo adjudication due to non-participation in prior proceedings?
Sections Cited
250, 147, 144, 69A, 148, 142(1), 44AD
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “SMC”, PUNE
Before: DR.MANISH BORAD & MS. ASTHA CHANDRA
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
This appeal filed by the assessee pertaining to the Assessment Year 2013-14 is directed against the order dated 25.07.2024 passed by National Faceless Appeal Centre, Delhi u/s.250 of the Income-tax Act, 1961 (in short ‘the Act’) which in turn is arising out of the Assessment order dated 31.08.2021 passed u/s.147 r.w.s.144 of the Act.
Briefly stated, the facts of the case are that the assessee is an individual who has not filed the return of income for the A.Y. 2013-14. Based on the information available with the Department that the assessee has deposited cash exceeding Rs.10.00 lakh, ld. AO opined that income escaped assessment to tax. The case was reopened by issuance of notice u/s.148 of the Act. Various notices u/s.142(1) were also issued to which there was no compliance from the side of assessee. Ld. AO completed the assessment u/s.147 rw.s.144 of the Act making addition of Rs.12,40,400/- as unexplained money u/s.69A of the Act.
Being aggrieved by the above assessment, assessee preferred an appeal before the ld.CIT(A) who vide impugned order dismissed the appeal in limine by observing as under :
“6. Decision on merits of the Case:- Though I have dismissed the appeal due to non-prosecution by the Appellant, the grounds raised by the Appellant are adjudicated on merits as under:- 6.1 In ground No.1 t to 4, the appellant has contested the addition of Rs. 12,40,400/- made by the AO u/s 69A of the Act
I find from the assessment order that the appellant had not filed return of income for AY 2013-14. The AO noted from the information received in AIMS Module of ITBA i.e. NMS data that the appellant had deposited cash of Rs.12,40,400/- in saving bank account but the source of cash deposited was not explained by filing return of income.
Therefore, the case was re-opened u/s 147 of the Act and a notice u/s 148 was issued on 27/02/2020. During the course of re- assessment proceedings, the appellant did not respond to notice issued u/s 148 or notices issued u/s 142(1) or show cause notice issued by the AO. Therefore, the AO completed the assessment u/s 144 of the Act by making addition of Rs.12,40,400/- u/s 69A on account of unexplained cash deposits.
During the appellant proceedings the appellant has not responded any of the hearing notice in spite of giving 5 opportunities and failed to submit the written submission in support of the grounds of appeal raised. I find that the appellant contended in the statement of facts that his income was below taxable limit as per section 44AD hence he did not file the return of income. In the grounds of appeal, the appellant contended that the cash was deposited out of sale of fruits which is the business of the assessee and sales are always in cash only. However the appellant has not produced any evidence in support of his contention mentioned above. Therefore I am unable to accept the grounds of appeal raised by the appellant. I find from the assessment order that there is no infirmity in the finding given by the AO for taxing the income of Rs. 12,40,400/- u/s 69A in absence of explanation submitted by the appellant. Therefore the grounds of appeal raised by the appellant are dismissed.”
Now the assessee is in appeal before the Tribunal.
At the outset, we find the appeal is time barred by limitation by 108 days before the Tribunal. The assessee has filed a condonation stating that his daughter was severely ill owing to brain related issues and her mobile number was used as contact number for income-tax purposes. Medical reports are placed on record at pages 85 and 86 of the paper book. Therefore, the assessee was unaware of the notice of hearing which led to passing of the orders against the assessee.
Therefore, the delay in presenting the appeal is due to bonafide reasons mentioned above. It is prayed to condone the said delay. On going through the averments in the condonation petition and the medical reports of his daughter, we are satisfied that there was ‘reasonable cause” which prevented the assesssee in presenting the appeal within the stipulated time. We therefore condone the delay of 108 days in the larger interest of justice.
On merits of the issues, we find that the assessee has not participated in the proceedings before the AO as well as before the First appellate Authority. Ld. Counsel for the assessee at the outset submitted that the assessee could not represent before the authorities below due to his daughter’s severe brain related illness. Therefore, it is prayed to remit the issues on merit to the file of ld.CIT(A) to which Ld. Departmental Representative has no objection. Considering the entirety of facts and circumstances of the case, paper book filed and the submissions of the ld. Counsel for the assessee, the issues on merit are being remitted to the file of ld. Jurisdictional Assessing Officer for denovo adjudication. Asseessee is directed to provide correct email id for proper communication and also update the same on PAN Login of Income-tax Website. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause, failing which the ld. AO shall be free to proceed in accordance with law. Finding of the ld. CIT(A) is set aside and effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 29th day of January, 2025.