SMT P VANI MURTHY,HYDERABAD vs. DY CIT-CC-4(1), MUMBAI

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ITA 1545/MUM/2020Status: DisposedITAT Mumbai02 November 2021AY 2008-094 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the AO should verify if the assessee had indeed filed a return for the current year, as claimed. If a return was filed, the assessment should be based on it. The matter was remitted to the AO for fresh examination.

What were the facts?

The Assessing Officer (AO) framed an assessment under section 153C for AY 2008-09 due to the assessee's non-cooperation. The AO estimated the income at Rs. 1,76,400 based on the previous year's return, stating no return was filed for the current year. The CIT(A) confirmed this action.

What were the issues?

Whether the AO was justified in estimating income based on the previous year's return without verifying the filing of the current year's return by the assessee.

Which sections of the Income-tax Act were involved?

Section 153C,Section 139

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” Bench, Mumbai

Before: Shri Shamim Yahya

For Respondent: Shri Milind S.Chavan-DR
Hearing: 01.11.2021Pronounced: 02.11.2021

This appeal by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals)-52 dated 13.12.2019 and pertains to assessment year 2008-09.

2.

Grounds of appeal

read as under:-

1. On the facts and circumstances of the case and in law, the Ld. CIT (A) erred in confirming the AO's action of estimating total income of appellant at Rs. 1,76,400/- despite the fact that appellant has declared returned income at Rs. 1,37,300/- in return of income filed u/s. 139 of the Act.

2. The appellant craves leave to add to, alter, amend and /or delete all or any of the foregoing grounds of appeal.

3. The appellant prays before the Hon'ble Tribunal to delete the additions made by the AO and to the extent confirmed by the Ld. CIT(A).

3.

Brief facts of the case are that assessee was framed in this case u/s. 143(3) r.w.s. 153C. In his case, AO noted that despite several notices, the assessee

2 Smt.P.Vani Murthy has not cooperated and not responded. The AO made the addition on the basis of last year return as under:-

“From the available records in this office, it is noticed that the assessee has not filed return of income for the year under consideration. In absence of any reply of any notice/show cause notice etc from assessee, the return of income filed by the assessee for immediate assessment year i.e. AY 2009-10 is/taken as return income for the AY 2008-09. The return income of the assessee for the AY 2009-10 is Rs.1,76,400/- and therefore, deemed income of the assesse£)for the A¥ 2008-09 is also taken at Rs.1,76,400/-.”

4.

Upon assessee’s appeal Ld.CIT(A) affirmed the action of the AO, he has held as under:-

“All the Grounds relate to the estimation of income for the relevant year to be of Rs, 1,76,400/- on the basis of the income returned by the assessee in the immediate succeeding year relevant to A.Y. 2009-10. As discussed in para 2.1 above, there was no compliance to the various statutory notices issued by the AO and this left the AO with no option but to complete the assessment by reasonably estimating the income of the assessee for the relevant year on the basis of the income returned of RE. 1,76,400/- in the immediate succeeding year relevant to A.Y. 2009-10. The assessee contends that she had filed her return of income for the relevant year declaring an income of Rs. 1,37,300/-, however there is no evidence submitted in support of her claim. In any case, the income of the assessee for the relevant year has only been reasonably estimated by the AO since there was no compliance in the assessment proceedings. Therefore, the filing of return declaring an income of-Rs. 1,37,300/- for the relevant year, is not so material. Accordingly, all the grounds of appeal are dismissed.”

5.

Against the above order, assessee is in appeal before ITAT.

6.

I have heard the ld. DR and perused the record. I note that assessment has been framed by the AO, because of non cooperation of the assessee on the basis of income returned last year, AO has also noted that assessee has not filed any return during the year. However, assessee has contended before the Ld.CIT(A) that for the current assessment year, assessee has already declared an income of Rs. 1,37,300/-. However Ld.CIT(A) has rejected this claim by 3 Smt.P.Vani Murthy observing that there is no evidence submitted in support of this claim. Ld.CIT(A) has further held that filing of return declaring income of Rs. 1,37,300/- for the relevant year is not so material. In my considered opinion, AO from his assessment records can very well check whether the assessee has filed this return as claimed or not. Ld.CIT(A) observation that whether assessee has filed current year return or is not material is not sustainable AO is making the addition on the basis of last year return by noting that assessee has not filed return for the current year. If the return for the current year has been filed, the assessment has to be framed on the basis of current year return. Hence in the interest of justice,, I remit the issue to the file of the AO. The AO shall examine the issue afresh in light of the direction as above and pass order afresh after giving assessee an opportunity of being heard.

7.

In the result, this appeal by the assessee is allowed for statistical purpose.

Pronounced in the open court on 02 .11.2021

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