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Facts
The Assessing Officer (AO) noted cash deposits and credit entries of Rs. 4,03,11,933/- in the assessee's bank accounts during demonetisation. Due to non-compliance, the AO passed an ex-parte assessment under Section 144, adding the amount as unexplained money under Section 69A. The CIT(A) upheld the addition, granting a nominal relief of Rs. 3,00,000/-, resulting in a confirmed addition of Rs. 4,00,11,933/-.
Held
The Tribunal dismissed the appeal both on grounds of non-prosecution due to repeated non-compliance and withdrawal of appearance by the Authorized Representative. On merits, the Tribunal found no error in the CIT(A)'s order, affirming that the assessee failed to provide credible evidence to explain the substantial bank deposits, thus sustaining the addition under Section 69A.
Key Issues
Whether the ex-parte assessment and addition of unexplained money under Section 69A read with Section 115BBE were justified, and whether the appeal should be dismissed for non-prosecution due to the assessee's non-compliance.
Sections Cited
250, 144, 69A, 133(6), 142(1), 115BBE, 271AAC, 271F, 272A(1)(d), 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD
This appeal by the assessee is directed against the order dated 30.01.2024 passed by the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”], under section 250 of the Income Tax Act, 1961[hereinafter referred to as “the Act”] for the assessment year 2017–18, confirming the ex-parte assessment order dated 23.12.2019 passed by the Assessing Officer under section 144 of the Act, wherein an addition of Rs.4,03,11,933/- was made under section 69A of the Act, subsequently restricted by the CIT(A) to Rs.4,00,11,933/-.
2 2. The appeal has been filed with a delay of four days. However, in the circumstances discussed hereinafter, we do not consider it necessary to adjudicate the issue of condonation of delay, since the appeal itself is liable to be dismissed on merits for non-prosecution.
Facts of the Case
The facts of the case, in brief, are that the Assessing Officer (AO), on the basis of AIR information and data obtained from the banker under section 133(6), noticed cash deposits aggregating to Rs.92,76,000/- during the period of demonetisation and total credit entries amounting to Rs.4,03,11,933/- in two bank accounts maintained by the assessee with Vijaya Bank. The assessee failed to comply with notices issued under section 142(1) and did not file any return of income. Consequently, the AO framed the assessment under section 144 of the Act and added the entire credits under section 69A as unexplained money, taxing the same under section 115BBE. Penalty proceedings under sections 271AAC, 271F and 272A(1)(d) were also initiated.
In appeal, the learned CIT(A), after granting multiple opportunities, noted that the assessee filed certain explanations on record stating that the transactions represented internal fund transfers, cash in hand, unsecured loans, advances, and business collections. However, no supporting evidences such as confirmations, cash books, audited statements, or documentary proof were submitted. The CIT(A), after considering the totality of facts and in line with certain judicial precedents, allowed a nominal relief of Rs.3,00,000/- for past savings/cash in hand and confirmed the balance addition of Rs.4,00,11,933/- under section 69A of the Act.
3 4. Aggrieved, the assessee is in appeal before us raising multiple grounds challenging the ex-parte assessment, applicability of section 69A and section 115BBE, levy of interest and penalties, and procedural lapses in the appellate order under section 250(6) of the Act. It is also contended that the authorities failed to appreciate the facts and explanations properly and the benefit of telescoping was not granted.
The appeal was fixed for hearing before the Bench on multiple occasions. As recorded from the hearing notices and internal records, the matter was listed for hearing on eleven (11) occasions between 2024 and 2025, during which adjournments were either sought or there was no compliance from the assessee’s side. On the twelfth occasion, i.e., on 06.05.2025, the learned Authorised Representative filed a letter before the Bench expressly withdrawing his appearance from the case, stating that he had not received the necessary instructions or information from the assessee. A copy of the withdrawal letter has been placed on record. No adjournment request was moved, nor any submission was filed in writing.
In our considered view, this conduct clearly demonstrates that the assessee is not interested in pursuing the present appeal. The pattern of repeated adjournments and failure to respond, followed by withdrawal of representation citing absence of instructions, reinforces the conclusion that the assessee has abandoned the appellate remedy. In our opinion mere filing of appeal is not enough and the appellant must actively pursue the matter.
Even otherwise, we find no infirmity in the order of the learned CIT(A), who after giving multiple opportunities, examined the factual matrix and concluded that the assessee had not offered any credible 4 evidence to explain the nature and source of the substantial bank deposits. The addition under section 69A was sustained after granting a reasonable deduction of Rs.3,00,000/- for cash in hand. No new material or argument has been placed before us to disturb these findings.
Accordingly, the appeal is liable to be dismissed in limine for 8. non-prosecution, and even on merits, we find no justifiable reason to interfere with the order passed by the learned CIT(A).
In the result, the appeal filed by the assessee is dismissed.
Order pronounced in the Court on 7th May, 2025 at Ahmedabad.