VISHWAS COMODITY,PATAN vs. THE INCOME TAX OFFICER, WARD-1, PATAN

The assessee preferred an appeal before the CIT(A), which was also dismissed ex parte by order dated 17.05.2024. The CIT(A) recorded that the appeal was filed with a delay of 77 days, which was condoned on the basis of reasonable cause shown by the assessee. However, on merits, the CIT(A) held that the assessee did not respond to multiple notices issued under section 250 of the Act dated 25.03.2022, 15.11.2022, 01.03.2024, 29.03.2024, and 23.04.2024. The assessee neither filed any written submissions nor appeared during the hearings. The CIT(A) referred to judicial precedents, including Tukoji Rao Holkar v. CIT (223 ITR 480), CIT v. B.N. Bhattacharya (118 ITR 461), and Whirlpool India Ltd v. DCIT (ITA No. 2006/Del/2011), to support the proposition that law assists only those who are vigilant and not those who sleep over their rights. On the basis of material available on record and in the absence of any rebuttal from the assessee, the CIT(A) confirmed the addition of Rs.1,18,10,000/- and dismissed the appeal.

Aggrieved by the order of CIT(A), the assessee is in appeal before us raising following grounds:

The Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi has erred in passing an Ex-Parte Order dismissing the appeal without providing reasonable opportunity of being heard to the appellant. Hence the same being against the principles of natural justice and equity requires to be quashed.

The Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi has erred in dismissing the appeal filed against the assessment order passed u/s.147 r.w.s.144 r.w.s.144B of the Act in pursuance of Notice issued u/s. 148 of the Act which is illegal and bad in law hence the same should be cancelled.

The Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi has erred in confirming action of the assessing officer in determining the total income at Rs.1,18,10,000/- 5 information of cash deposits of Rs.1,18,10,000/- without any explanation from the assessee. The assessee also failed to respond to notices issued by the CIT(A), and no submission was filed at the appellate stage. However, during the course of hearing before us, the assessee has submitted a sworn affidavit and cogent explanation attributing the non- compliance to circumstances beyond its control, including the sudden retirement of the accountant who handled communication with the Department. The assessee has now expressed willingness to produce the relevant evidence explaining the source of cash deposits. The DR has not objected to the restoration of the matter.

In the interest of substantial justice and considering the principle that an assessee should not suffer for the default of his authorised representative or accountant, we deem it appropriate to set aside the impugned orders of the lower authorities and restore the matter to the file of the Assessing Officer. The Assessing Officer shall afford due opportunity to the assessee to furnish relevant documentary evidence in support of the cash deposits, including any submissions under Rule 46A. The assessee is directed to cooperate fully and ensure that the matter is concluded expeditiously.

At the same time, we note that the assessee remained non- responsive at multiple stages of the proceedings before the Assessing Officer and the CIT(A), resulting in wastage of public resources. As a measure of deterrence and to enforce procedural discipline, we deem it appropriate to impose a cost of Rs.5,000/- on the assessee. The assessee shall deposit the said amount to the credit of the Income Tax Department within a period of 30 days from the date of this order and furnish proof of payment before the Assessing Officer.

The impugned order is set aside, and the matter is restored to the file of the Assessing Officer for fresh adjudication in accordance with law