RANJANA DEVI,MAUR MANDI vs. INCOME TAX OFFICER WARD-1(1), BATHINDA

ORDER Per: DR. DIPAK P. RIPOTE, A.M.: This is an appeal filed by the assessee directed against the order of ld. Commissioner of Income Tax (Appeals), NFAC, dated 28.02.2025 u/s 250 of the Act 1961, emanating from the order u/s 143(3) of the Act dated 28.03.2023, for the Assessment Year 2017-18.

3. At the outset, during the course of hearing, none appeared on behalf of the assessee before the Bench.

4. The Assessee raised the following grounds of appeal:

1. That order passed u/s 250 of the Income Tax Act, 1961 by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi is against law and facts on the file in as much as he was not justified to uphold the action of the Leamed Assessing Officer in framing the assessment without appraising and ignoring submissions and other information supplied under section 133(6) of the Income Tax Act, 1961 as regarding the source of money.

2. That the Learned Commissioner of Income Tax (Appeals) is against law and facts on the file in as much as in not allowing the appellant a reasonable opportunity of being heard.

3. That the Learned. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi is against law and facts on the file in as much as by not properly apprising the grounds of 3 Assessment Year: 2017-18 appeal raised by the appellant under section 250 of the Icome Tax Act, 1961.

4. That the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi further gravely erred in upholding the addition of Rs. 11,50,000/- as alleged unexplained money on account of cash deposited in the bank account by resort to provisions of Section 69A of the Act.”

Statement of Facts 5. Statement of facts filed by the assessee alongwith Form No.35 is reproduced as below: “1. That the appellant, a homemaker female, has sources of income from interest in bank accounts

2. That the appellant has e-filed her return of income for A.Y. 2017-18 declaring an income of Rs. 269960/- as on 06-07- 2017.

12. That the case of appellant was picked up for limited scrutiny proceedings for the reason of deposit of sum of Rs. 12,00,000/- in cash in her saving bank account bearing

13. The assessment was framed under section 143(3) vide order dated 13.11.2019 by accepting the returned income.

6. Aggrieved by the order of the AO, the assessee filed an appeal before the ld. CIT(A). The ld. CIT(A) confirmed the order of the AO. Submission of ld. DR 7. The ld. DR relied on the order of ld. AO and ld. CIT(A). Findings and Analysis 8. We have heard the ld. DR. 8.1 In this case, return of income for A.Y. 2017-18 was filed by the assessee u/s 139(1). Assessee had made cash deposit of Rs.12, lakhs in her bank account during the demonetization period. Original assessment order u/s 143(3) was passed on 13.11.2019 by accepting the returned income. However, ld. PCIT passed an order 8 Assessment Year: 2017-18 u/s 263 on 15.03.2022. In compliance to the order u/s 263 the AO passed assessment order u/s 143(3) r.w.s. 263 on 28.03.2023. 8.2 It is specifically mentioned in the assessment order that assessee explained the source of cash deposit as personal saving of Rs.2 lakhs and gift of Rs.10 lakhs. 8.3 It was submitted during assessment proceedings that out of Rs.10 lakhs, Rs.7 lakhs was gift from assessee’s father Mr. Tarsem Kumar and Rs.3 lakhs from assessee’s brother Mr. Jishu Garg. 8.4 During assessment proceedings assessee filed affidavit of these persons. It is also mentioned in the assessment order that AO issued notices u/s 133(6) dated 23.02.2023 to Mr. Tarsem Kumar and Mr. Jishu Garg they are filed their reply which is produced in the assessment order. Mr. Tarsem Kumar, filed copy of bank statement, copy of return of income, similarly, Mr. Jishu Garg filed copy of bank statements copy of return of income, capital account. Both of them filed copies of notarized affidavit. However, AO rejected the submissions and made addition of Rs.11,50,000/-.

9. Aggrieved by the assessment order assessee had filed appeal before the ld. CIT(A), the ld. CIT(A) has not taken cognizance of the affidavit filed by the donors, copies of the return of income copies of the bank statement of the donors which was 9 Assessment Year: 2017-18 already on the record in the income tax department. Even if assessee had not complied the notices issued by the ld. CIT(A), the documents mentioned above were already on the record in the income tax department which was accessible to ld. CIT(A). It was the duty of the ld. CIT(A) to study the documents which were available in the filed of the ld. CIT(A) and then decide the case on merits. 9.1 The ld. CIT(A) has not bothered to read the submissions of the assessee which was made before the AO and the documents filed before the AO. CIT(A) has not discussed the submission of the Assesseee.

10. The Hon’ble Bombay High Court has held in the case of Pr. CIT(Central) Vs. Premkumar Arjundas Luthra (HUF) Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “8. From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision 1 Assessment Year: 2017-18 0 on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) is coterminous with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.” Unquote. 10.1 Thus, Hon’ble Bombay High Court has categorically held that CIT(A) has to decide the appeal on merit and CIT(A) does not have any power to dismiss appeal for non-prosecution.

11. In the case of the assesseee the CIT(A) has not decided the case on merit. Therefore, respectfully following Hon’ble Bombay High Court, we set aside the 1 Assessment Year: 2017-18 1 order of CIT(A) to CIT(A) for de-novo adjudication. CIT(A) shall provide opportunity of hearing to the assessee. Accordingly ground no.2 of the assessee is allowed.