RAJ KUMAR APPALA,HYDERABAD vs. INCOME TAX OFFICER, WARD-1, NELLORE

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ITA 601/HYD/2020Status: DisposedITAT Hyderabad05 May 2022AY 2015-166 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal and decided to remit the issue back to the CIT(Appeals) for fresh consideration. The CIT(Appeals) is directed to examine the assessee's submissions and documents regarding the gifts.

What were the facts?

The assessee introduced Rs. 73,40,000 as capital in his business, claiming it was received as gifts from his father and brother. The Assessing Officer added this amount as unexplained cash credits, which was upheld by the CIT(Appeals).

What were the issues?

Whether the gifts received by the assessee were adequately explained and whether the CIT(Appeals) erred in not considering additional evidence.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD ‘A’ BENCH, HYDERABAD.

O R D E R Per Shri Laliet Kumar, J.M. : This assessee’s appeal for Asst. Year 2015-16 arises from the Commissioner of Income Tax (Appeals), Tirupati order dt.7.2.2020 for the Asst. Year 2015-16.

2.

None appeared on behalf of the assessee. Heard learned DR and proceeded to hear the appeal exparte.

3.

We notice at the outset that assessee’s appeal suffers from 210 days delay in filing. To this effect, the ld. AR filed a petition along with an affidavit wherein it was affirmed that due to ill health and COVID-19 pandemic the assessee could not move from the place located in the state of AP caused the impugned delay in filing of the appeal. Case law Collector Land Acquisition vs Mst. Katiji & Ors, 1987 AIR 1353 (SC) and University of Delhi Vs. Union of India, Civil Appeal No. 9488 & 9489/2019 dated 17 December, 2019, hold that such a delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We accordingly hold that revenue’s impugned delay of 303 days is neither intentional nor deliberate but due to the circumstances beyond its control. The same stands condoned. Case is now taken up for adjudication on merits.

4.

The assessee has raised the following grounds in the appeal :

“ 1. The learned CIT (Appeals) erred in law and facts of the case in confirming the order of the Assessing Officer who had added the capital introduced amounting toRs.73,40,000 as unexplained cash credits ignoring the fact that substantial amount of this was gift received from father and brother of the appellant.

2. The learned CIT (Appeals) ought to have considered the affidavits filed by the donors and ought to have allowed the appeal instead of taking shelter on the ground that the appellant had not made any request for the submission of additional evidence.

3. The learned CIT (Appeals) ought to have appreciated the fact that the gifts were made out of the properties sold in the earlier assessment years by the donors and ought not have treated the gifts received by the appellant as unexplained cash credits.

4. The appellant craves leave to add, amend, alter, vary and/or withdraw the above grounds of appeal

.”

5. The brief facts of the case are that the assessee is an individual and deriving income from retail trading, e-filed his Return of Income declaring loss for the Assessment Year

2015-16 on 5.11.2016 admitting total income of Rs.Nil. The case was selected under CASS and statutory notices were issued calling for the information. In response, the assessee filed information required by the Assessing Officer. The learned AR was asked to furnish the sources for the investment of Rs.73,40,000/- into his business. The confirmation letters were produced from Sri A. Ranganatham & Sri A. Duilip Chakravarthi stating that they have gifted the above amount out of sale of plots. On verification, the Assessing Officer has not accepted the explanation given by the assessee and added an amount of Rs.73,40,000 as unexplained cash credits u/s.68 of the Act. Aggrieved by the order of Assessing Officer, the assessee filed an appeal before the CIT (Appeals), who confirmed the addition made by the Assessing Officer u/s. 68 of the Act. Aggrieved by the order of learned CIT (Appeals), the assessee is in appeal before us.

6.

During the course of hearing, none represented the assessee, from the record it transpired that the CIT

(Appeals) has erred in law and facts of the case in confirming the order of the Assessing Officer who had added the capital introduced u/s. 68 of the Act amounting to Rs.73,40,000 as unexplained cash credits ignoring the fact that substantial amount of this was gift received from father and brother of the assessee. He prayed that one more opportunity of hearing be provided to present his case before the learned CIT (Appeals) and the matter may be sent back to the file of learned CIT (Appeals) for de novo consideration.

7.

The learned D.R. has strongly supported the orders of authorities below and argued that the case may be decided on merit at this stage and opposed the request of learned A.R. for sending back the matter to the learned CIT (Appeals).

8.

We have heard both the parties and perused the material available on record. Keeping in view of the facts and circumstances of the case, we remit the issue back to the file of CIT (Appeals) for consideration afresh after

examining the assessee's submissions and documents. We direct the learned CIT (Appeals) to examine afresh and the issue to be decided as per law. The assessee is also directed to submit all the relevant documents before the learned CIT (Appeals) for examination and co-operate with the authorities for early disposal of the case and not to seek unnecessary adjournments without valid reason. It is ordered accordingly. This ground of appeal is allowed for statistical purposes.

9.

In the result, the assessee's appeal is allowed for statistical purposes. Order pronounced in the open court on 5th May, 2022.

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