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Facts
The assessee, a senior citizen, failed to appear before the AO and CIT(A) for reassessment proceedings for AY 2012-13 due to lack of technical proficiency and reliance on his son. The AO made additions on account of property sale and cash deposits, and levied a penalty under Section 271(1)(b). The CIT(A) dismissed the appeal ex-parte.
Held
The Tribunal condoned the delay in filing the appeals, noting the assessee's age and lack of technical knowledge. The Tribunal decided to remand the matter back to the AO for a fresh adjudication after affording the assessee an opportunity of hearing. The AO was also directed to consider the cost of acquisition and indexation for computing capital gains.
Key Issues
Whether the assessee, being a senior citizen with limited technical knowledge, should be granted another opportunity to present their case and whether the cost of acquisition and indexation benefits should be considered for capital gains computation.
Sections Cited
148, 142(1), 144, 271(1)(b), 2(14), 144, 143
AI-generated summary — verify with the full judgment below
सुनवाई की तारीख/Date of Hearing : 10/03/2025 उदघोषणा की तारीख/Date of Pronouncement : 20/03/2025 आदेश/Order PER LALIET KUMAR, J.M: The captioned appeals are filed by the assessee, feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for A.Y. 2012-13 dt. 13/02/2023 and 28/03/2023 respectively.
At the outset it is noticed that both the above appeals barred by limitation by 67 days and 110 days respectively for which condonation applications have been filed in both the above appeals.
After considering the condonation applications filed by the assessee in both the above appeals, we condone the delay for which sufficient cause is shown, and admit both the appeals for adjudication.
Before us, at the outset, both the parties submitted that the issues raised in both the appeals were identical. In view of the aforesaid submissions, we, for the sake of convenience proceed to dispose of both the captioned appeals by a consolidated order but however refer to the facts in for A.Y. 2012-13. 5. Briefly the facts of the case are that the assessee is an individual taxpayer who was issued a notice under Section 148 of the Income Tax Act for reassessment for the financial year 2012-13. 6. During the course of the assessment proceedings, the Assessing Officer (AO) issued notices under Section 142(1) of the Act on 16.10.2019 and 14.12.2019, which remained uncomplied with by the assessee. Consequently, the AO completed the assessment ex-parte under Section 144 of the Act on 18.12.2019, determining the total income of the assessee at Rs. 1,59,29,130/-.
6.1 The AO also initiated penalty proceedings under Section 271(1)(b) of the Act for non-compliance with the statutory notices. A show-cause notice was issued on 18.12.2019, followed by subsequent notices on 05.10.2020 and 12.03.2021. The assessee failed to respond to these notices, and the AO levied a penalty of Rs. 20,000/- under Section 271(1)(b) of the Act.
Against the order of the Ld. AO the assessee went in appeal before the Ld. CIT(A). The CIT(A) dismissed the appeal of the assessee by, holding that the assessee had failed to avail multiple opportunities provided during the appellate proceedings and had not submitted any written submissions to substantiate the grounds of appeal. The relevant portion of the Ld. CIT(A)’s order read as under:
5.1.2 In this case, several opportunities of being heard given to the appellant. Details of opportunities of being heard are given here as under:- S.No. Fixed for Way of Result Notice issuing hearing Service of date Notice 13.02.2023 1. 17.02.2023 By e-mail Not uploaded any written submission 2. 27.02.2023 07.03.2023 By e-mail Not uploaded any written submission
3. 14.03.2023 22.03.2023 By e-mail Not uploaded any written submission Considering the non-compliance as detailed above by the appellant, it seems that the appellant is not interested to pursue his appeal. Therefore, it cannot be kept pending adjudication for indefinite period. The appellant has not bothered to attend the appellate proceedings. This shows that the appellant is not interested in pursuing his appeal and/or he has no defense against the additions made by AO. If the appellant is not availing opportunities given, they cannot allege contravention of principles of natural justice as held in the case of P.N. Balasubramanium (AP) 112 ITR 512. Therefore, the appeal of the appellant is liable for dismissal. Such view is further supported by the following judicial pronouncements:- i)Hon’ble Supreme Court in the case of CIT vs. B.N. Bhattacharjee and another, reported in 118 ITR 461(relevant pages 477 and 478) wherein their Lordhsips have held that :- “An appeal means an effective appeal. An appeal withdrawn is an appeal non est as judicial thinking suggests. Purposefully interpreted, preferring an appeal means more than formally filing it but effectively prosecuting it. Mere institution followed by withdrawal would cancel the effect and result in non-prosecution and obliteration of appeal which is the same as not preferring an appeal” ii)Hon’ble M.P. High Court in the case of Estate of Late Tukojirao Holkar vs. CWT, 223 ITR 480 (MP),while dismissing the reference made at the instances of the assessee in default made following observation in their order :- “If the party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of the paper books so as to enable hearing of the reference, the court is not bound to answer the reference.” 5.1.3 However, in the interest of natural justice, the case of appellant was examined on merit in the light of SOF and grounds of appeal. It is found that the issues raised by the appellant through various grounds of appeal have been considered by A.O during the assessment proceeding which could not be contested or rebutted during the appeal proceedings as can be seen from the fact that despite a number of opportunities, the appellant has failed to file any written submission in support of grounds of appeal. Therefore, all the grounds of appeal are dismissed. 6.0 In the result, the appeal is dismissed.
8. Against the order of the Ld. CIT(A), the assessee is in appeal before us.
During the course of hearing Ld. AR submitted that the AO has made the addition under section 144/143 of the Act for the A.Y. 2012-13, thereby making the addition on account of sale of property to the tune of Rs. 1,40,00,000/- and the cash deposited with State Bank of India amounting to Rs. 15,26,000/-. It was submitted by the Assessee, the AO in para 4 has mentioned as under:
4. As per information collected and available on record, during the year under consideration the assessee has sold property bearing House No. 1266 Sector-42B Chandigarh vide sale deed dated 18.11.2011 for a consideration of Rs. 1,40,00,000/- which is a capital asset in terms of provisions of section 2(14) of the Act. In the absence of cost of acquisition of the property sold and the date on which the same was purchased, sale consideration is of Rs. 1,40,00,000/- is treated to be the short term capital gain which had accrued to the assessee during F.Y. 2011-12 and was liable to be charged to tax. Hence the total sale consideration of 1,40,00,000/- is treated as short term capital gain on the sale of the property and is brought to tax. (Addition of Rs. 1,40,00,000/-) 9.1. The Learned AR submitted that the assessee is a senior citizen aged 73 years, who is not technically educated and is unfamiliar with Income Tax laws. He is entirely dependent on his son for day-to-day activities. At the time of filing the appeal before the Learned CIT(A), the son's email ID was provided for receiving notices. However, as the son was occupied with his household responsibilities, he had not informed about the intimation sent to the assessee regarding the appeal. Consequently, the Learned CIT(A) decided the appeal ex parte.
9.2 It was further submitted that the case may kindly be remanded back to the lower authorities, as before both occasions before the AO as well as the Learned CIT(A) the assessee was ex parte. Furthermore, the Learned AR submitted that despite the AO and the Learned CIT(A) noting that the assessee had sold House No. 1266, Sector 42B, Chandigarh, vide sale deed dated 18/11/2011 for a consideration of Rs. 1,40,00,000/-, the AO and the Learned CIT(A) failed to grant the benefit of the cost of acquisition as well as the indexation.
9.3 It was submitted that the documents, on the basis of which the lower authorities concluded that the value of the property was Rs. 1,40,00,000/-, itself contained details of the purchase, such as the year of purchase consideration, date of registry, etc. Therefore, both authorities had failed to utilize the information available in this regard for the purpose of granting the benefit of deduction for the cost of acquisition as well as the indexed cost of acquisition.
The Ld. DR relied on the order passed by the Ld. CIT(A) and submitted that the assessee had been provided multiple opportunities to comply with the notices and to present his case. However, the assessee failed to avail these opportunities, indicating a lack of interest in pursuing the appeal.
We have heard the rival contentions and perused the material available on record. In the present case, it is observed that the Learned CIT(A) issued multiple notices to the assessee, which were duly served on the e-filing portal as well as the registered email ID of the assessee. However, it is to be noted that the assessee, being 73 years of age and not technically proficient, was unable to respond to the aforementioned notices, being dependent upon his son. 11.1 After considering the aforementioned discussion, we are of the view that the assessee, who is an 73 years old person and was not technically educated, due to which he has not received information about the notices sent by the Ld. AO as well as by the Ld. CIT(A) and assessee could not appear before the authority. Therefore, we are of the view that the assessee should be granted one more opportunity of hearing. Accordingly, we are remanding this matter back to the file of the AO. AO is directed to decide this issue afresh after affording opportunity of hearing to the assessee. AO is also directed to consider the cost of acquisition and indexation, for the purpose of computing the capital gain. The assessee is also directed to file the documents for purchase of property.
Now we shall deal with for the A.Y. 2012-13.
Both the parties fairly submitted that the facts and circumstances of this appeal is exactly identical to the Appeal in ITA No. 496/Chd/2023 for the A.Y 2012-13 and similar contentions raised therein may be considered, therefore, our findings and directions given in ITA No. 496/Chd/2023 shall apply mutatis mutandis to this appeals also.