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Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: SHRI SIDDHARTHA NAUTIYAL & SHRI MAKARAND V. MAHADEOKAR
ORDER \nPER MAKARAND V. MAHADEOKAR, AM:\nThis appeal by the assessee is directed against the order dated\n22.02.2024, passed by the Commissioner of Income Tax (Appeals), National\nFaceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”],\nfor the Assessment Year (AY) 2017-18, arising out of the ex-parte assessment\norder dated 19/11/2019 passed under Section 144 of the Income Tax Act,\n1961 [hereinafter referred to as “the Act"], by the Income Tax Officer, Ward-\n3(3)(2), Ahmedabad [hereinafter referred to as “AO”].\nITA No.87/Ahd/2025\nGovindji Budhaji Thakor vs. ITO\nAsst. Year: 2017-18\n2\nFacts of the Case:\n2. The assessee filed his return of income for A.Y. 2017-18 declaring an\nincome of ₹3,93,060/-. The case was selected for complete scrutiny under\nCASS. The AO issued a notice under Section 143(2) of the Act dated\n24.09.2018 through ITBA, which was duly served on the assessee. Subsequent\nnotices under Section 142(1) of the Act dated 22.05.2019 and 05.10.2019 were\nissued, calling for specific details, but no compliance was made by the\nassessee. A final show-cause notice dated 06.11.2019 was issued, requiring\nthe assessee to explain the Cash deposits of ₹21,69,000/- during the\ndemonetization period (08.11.2016 to 31.12.2016) in Central Bank of India &\nBank of India accounts, Unexplained credit entries of ₹85,08,876/- in the bank\naccounts during the year and Sale of immovable property for ₹50,00,000/-,\nwhich was not disclosed in the return of income.\n3.\nSince there was no response, the AO completed the assessment ex-\nparte under Section 144 and made the following additions:\n- ₹21,69,000/- as unexplained cash deposits under Section 69A of the\nAct.\n- ₹85,08,876/- as unexplained credit entries under Section 69A of the Act.\n- ₹50,00,000/- as unexplained sale consideration from immovable\nproperty.\n3.
The total assessed income was determined at ₹1,60,70,936/-, and the\nAO also initiated penalty proceedings under Section 271AAC & Section 270A\nof the Act.\n Budhaji Thakor vs. ITO\nAsst. Year: 2017-18\n3\n4.\nThe assessee filed an appeal before the CIT(A). Several notices were\nissued under Section 250 of the Act, but the assessee did not respond to any\nof them. Since the assessee failed to appear or provide any evidence, the\nCIT(A) dismissed the appeal for non-prosecution and confirmed the AO's\nadditions.\n5.\nAggrieved by the order of the CIT(A), the assessee preferred an appeal\nbefore us raising following grounds of appeal:\n1. The Id. CIT(Appeals) erred in law and on facts in dismissing the appeal of the\nappellant for non-prosecution and thereby confirming the addition of\nRs.1,56,77,876/- made by the Assessing Officer without appreciating facts and\nlaw of the case properly.\n2. The Id. CIT(Appeals) erred in law and on facts in confirming the addition of\nRs.21,69,000/-being alleged unexplained cash deposit u/s.69A r.w.s.115BBE\nwithout appreciating facts and law of the case properly.\n3. The Id. CIT(Appeals) erred in law and on facts in confirming the addition of\nRs.85,08,876/-being alleged unexplained credit entries in the bank account\nu/s.69A r.w.s.115BBE without appreciating facts and law of the case properly.\n4. The Id. CIT(Appeals) erred in law and on facts in confirming the addition of\nRs.50,00,000/-being alleged undisclosed sale consideration received on sale of\nimmovable property without appreciating facts and law of the case properly.\n5. The appellant craves leave to add, amend or alter the grounds of appeal at the\ntime of hearing, if need arise.\n5.
1. The appeal was filed before the Tribunal with a delay of 258 days. The\nassessee submitted an affidavit explaining the reasons for the delay, stating\nthat:\n•\nThe order of CIT(A) dated 22.02.2024 was received through e-\nproceedings and email intimation on the same date.\n•\nThe assessee, being uneducated in tax matters, relied entirely on his\nson, Mukeshji Govindji Thakor, to handle the tax proceedings.\n Budhaji Thakor vs. ITO\nAsst. Year: 2017-18\n4\n•\nDue to the assessee's ill health, the son sought advice from multiple\nconsultants, which resulted in conflicting advice and inaction on the\npart of the assessee.\n•\nIn December 2024, personal and financial disputes arose between the\nassessee and his son, leading to the assessee taking back control of his\nincome tax matters.\n•\nUpon consulting another tax consultant, it was discovered that no\nappeal had been filed before the Tribunal within the prescribed 60-day\nperiod.\n•\nThe assessee immediately engaged a legal representative, and the\nappeal was eventually filed on 13.01.2025, resulting in a delay of 258\ndays.\n6.\nOn the background of the facts and circumstances, the Departmental\nRepresentative (DR) raised no objection to the condonation of delay.\n7.\nConsidering the genuine hardship faced by the assessee, we find that\nthe reasons for the delay are bona fide and do not reflect any mala fide intent.\nAccordingly, the delay of 258 days is condoned, and the appeal is admitted\nfor adjudication.\n8.\nThe learned Authorized Representative (AR) submitted that due to the\nill health of the assessee, he was completely dependent on his son for\nassessment and appellate proceedings and therefore the assessee could not\nproperly represent his case before the lower authorities, resulting in an ex-\nparte assessment under Section 144 of the Act. The AR sought an opportunity\nfor the assessee to present his case on merits and, therefore, requested that\nthe matter be restored to the file of the AO for fresh adjudication.\nITA No.87/Ahd/2025\nGovindji Budhaji Thakor vs. ITO\nAsst. Year: 2017-18\n5\n9.\nThe DR did not object to the restoration of the matter to the AO but\nsubmitted that the assessee's non-cooperation before the lower authorities\ncaused unnecessary litigation, and hence, a nominal cost should be imposed\nas a deterrent.\n10. We have considered the rival submissions and perused the material on\nrecord. It is undisputed that the assessment was completed ex-parte under\nSection 144 of the Act due to the assessee's non-compliance with the notices\nissued under Sections 143(2) and 142(1) of the Act. The CIT(A) also dismissed\nthe appeal ex-parte due to the assessee's failure to participate in appellate\nproceedings. At the same time, we also note that the assessee's inability to\npursue the matter was due to factors beyond his control, including ill health,\nreliance on his son, and conflicting legal advice. The principle of natural\njustice demands that the assessee be given a fair opportunity to present his\ncase.\n10.
1. We have noted the reliance placed by the CIT(A) on the judicial\nprecedents where it was held that an appeal means an effective appeal, and\nmerely filing an appeal without actively prosecuting it is equivalent to not\nfiling an appeal at all and that the courts have the inherent power to dismiss\nappeals for non-prosecution. However, given the specific circumstances of\nthe case, we are of the opinion that one more opportunity should be granted\nto the assessee to present his case before the AO. At the same time, we find\nmerit in the DR's contention that the assessee's failure to comply with tax\nproceedings has led to unnecessary litigation, and a cost should be imposed\nto ensure future compliance.\n Budhaji Thakor vs. ITO\nAsst. Year: 2017-18\n6\n10.
2. In the interest of justice, we set aside the order of the CIT(A) and restore\nthe matter back to the file of the AO for de novo adjudication, with the\ndirection that the assessee shall fully cooperate and submit necessary\ndocuments in support of his claims. Further, we impose a cost of ₹5,000/- on\nthe assessee, payable to the Income Tax Department within 30 days from the\ndate of receipt of this order.\n11. In the result, the appeal of the Assessee is allowed for statistical\npurposes.\nOrder pronounced in the Open Court on 12th March, 2025 at Ahmedabad.\nSd/-\nSd/-\n(SIDDHARTHA NAUTIYAL)\nJUDICIAL MEMBER\n(MAKARAND V. MAHADEOKAR)\nACCOUNTANT MEMBER\nअहमदाबाद/Ahmedabad,\nदिनांक/Dated\n12/03/2025\nआदेश की प्रतिलिपि अग्रेषित/