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Facts
The assessee allegedly failed to file her income tax return, and the department, through its Insight Portal, found cash deposits of Rs. 7,75,000/- in her bank account. Subsequent investigation revealed total deposits of Rs. 26,44,120/-, part of which was treated as unexplained income by the AO.
Held
The tribunal held that the assessee deserves one last opportunity to present her case. The file was restored to the AO with a direction to provide this opportunity, cautioning the assessee to comply fully in the set-aside proceedings.
Key Issues
Whether the NFAC erred in dismissing the appeal due to a delay of 195 days without appreciating the medical reasons provided, and whether the addition of Rs. 25,40,120/- as unexplained income was justified.
Sections Cited
133(6), 69A, 147, 144, 144B, 115BE, 271AAC, 271F
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Income Tax Appellate Tribunal, SMC BENCH, LUCKNOW
Before: SHRI. SUDHANSHU SRIVASTAVA
Assessment Year: 2019-20 Mrs Krishnawati Yadav v. The Income Tax Officer-1 Pure Pandey Chauraha Raebareli Saray Manik Deeh Raebareli TAN/PAN:FBLPK8342E (Appellant) (Respondent) Appellant by: Shri Shubham Rastogi, C.A. Respondent by: Shri Sanjeev Krishna Sharma, D.R. Date of hearing: 27 01 2025 Date of pronouncement: 27 01 2025 O R D E R
This appeal has been preferred by the assessee against order dated 24.10.2024, passed by the National Faceless appeal Centre, Delhi (NFAC) for Assessment Year 2019-20.
The brief facts of the case are that the Income Tax Department received information through its Insight Portal that the assessee had not filed the return of income for the year under consideration, but had made cash deposits amounting to Rs.7,75,000/- in Bank of Baroda. The Assessing Officer (AO) issued statutory notices to the assessee, requiring the assessee to furnish the details of cash deposits in her Bank Account. However, the assessee did not comply with the notices issued by the AO. The AO, therefore, issued notice under section 133(6) of the Income Tax Act, 1961 (hereinafter called “the Act’) to Bank of Baroda, Khatoudhan, Raebareli, which furnished the Bank Account statements pertaining to the assessee, which revealed that the assessee had deposited a total sum of Rs.26,44,120/- in her two Bank Accounts during the year under consideration. In view of these facts, the AO proposed an addition of Rs.26,44,120/- under section 69A of the Act and issued a show cause notice dated 06.11.2023 to the assessee, in this regard. In response to which, the assessee, vide her reply dated 16.11.2023, submitted that the amount of Rs.1,04,000/- credited in Bank Account No. 2054000001512 related to Agricultural Income received from sale of wheat at Government POS and the amount of Rs.25,40,120/- found deposited in Bank Account No.20540100006387 did not relate to the assessee, but to her husband, Mr Raj Kumar. Not being satisfied with the reply of the assessee, the AO treated the credits of Rs.25,40,120/- in Bank Account No.20540100006387 as unexplained income and added the same to the income of the assessee under section 69A of the Act. The AO, accordingly, completed the assessment under section 147 read with 144/144B of the Act, assessing the total income of the assessee at Rs.25,40,120/-.
2.1 The AO also invoked the provisions of section 115BE of the Act and initiated penalty proceedings under sections 271AAC and 271F of the Act, separately.
3. Aggrieved, the Assessee preferred an appeal before the Ld. First Appellate Authority. The appeal was migrated to the NFAC, which dismissed the appeal of the assessee for the reason of there being a delay of 195 days in filing of the appeal before the Ld. First Appellate Authority.
Now, the assessee has approached this Tribunal challenging the dismissal of its appeal by the Ld. NFAC by raising the following grounds of appeal:
The Ld. C.I.T. (A) NFAC erred on facts and in law in dismissing the appeal as barred by limitation without appreciating that there was a Medical Reason of her son for which appeal could not be filed in time. The appellant submitted Written Submission for delay of 195 days along with Medical Certificate vide Acknowledgement no. 401547A31270824 dated 27.08.2024 on E- Filing Portal. However, Ld. C.I.T. (A) only considered the submission and held that no Medical Certificate is filed, accordingly dismissed the appeal.
2. The Ld. C. I. T. (A) NFAC, failed to appreciate that Assessee is living in Rural being Remote Area of Raebareilly and was not properly aware of e-filing proceeding and not have computer facility. Further, due to serious illness of her son, she was busy in medical treatment at Raebareilly City and she was not aware about the passing of Assessment Order through e-profile. Thus, there was a reasonable cause being Medical Reason of her son for delay of 195 days in filing the appeal.
The Ld. C.I.T.(A) failed to appreciate that as the Assessee is living in remote rural area of Raebareilly. Assessee's husband Mr. Raj Kumar is working as a Bank Business Correspondent with Bank of Baroda. The Bank Account with Bank of Baroda at Branch Khataudhan Dist. Raebareilly A/c No. 20540100006387 is in Joint Name of Assessee and her husband Raj Kumar. All debit and credit amount during the year in said bank accounts are w.r.t. Bank Business Correspondent( B. C. Point) work carried out by her husband Raj Kumar, 4. That the credits in the Bank Account aggregating Rs.25,40,120/- during the year on different dates in piecemeal are Fund Transferred from Overdraft Account of her husband Raj Kumar with Bank of Baroda, Khataudhan Branch A/c No. 20540400001131 and agriculture receipts from sale of crops transferred through Kisan Sewa Kendra. Similarly, funds withdrawals during the year in piecemeals are distributed to Agriculturists living in Khataudhan village being part of B. C. Point Business of her husband Raj Kumar.
That the addition of Rs.25,40,120/- being credits in the Bank Account no. 20540100006387 is contrary to the facts of the case, as all the funds are transferred from the Bank Account No. 20540400001131 owned by Raj Kumar Husband of the Assessee and the withdrawals were w.r.t distribution of funds to Agriculturists of Khataudhan village as B. C. Point of Bank of Baroda owned by her husband Raj Kumar. In addition to this also crop sale proceeds of the funds credited from Kisan Sewa Kendra.
6. The addition of Rs.25,40,120/- made is highly excessive contrary to the fact law and principal of natural justice and without appreciating that these are the amount transferred from her husband Bank Account and distributed to Agriculturists of Khataudhan Village as business activity being B. C. Point of Bank of Baroda carried 5. During the course of hearing before me, the Ld. Authorized Representative for the assessee (Ld. A.R.) submitted that the NFAC had dismissed the appeal of the assessee for the reason of delay of 195 days in filing of the appeal before the Ld. First Appellate Authority and that the NFAC had not dealt with the issue in dispute on merits. The Ld. A.R. further submitted that the assessee could not be represented before the AO properly and, therefore, the assessment was completed under section 147 read with sections 144/144B of the Act. He prayed that one more opportunity may be given to the assessee to enable the assessee to present her case before the AO.
The Ld. Senior D.R. had no objection to the restoration of appeal to the file of the Assessing Officer.
I have heard the Ld. Senior Departmental Representative and have also perused the material on record. Looking into the facts of this case, I am of the considered view that the Assessee deserves one last opportunity to present her case and, therefore, in the interest of substantial justice, I restore this file to the Office of the Assessing Officer with the direction to provide one more opportunity to the Assessee to present her case and produce the necessary evidences in support of the transactions entered into by the Assessee. I also caution the Assessee to fully comply with the directions of the Assessing Officer in the set-aside proceedings when called upon to do so, failing which, the Assessing Officer shall be at complete liberty to pass the order in accordance with law, based on the material available on record even if it is ex-parte qua the assessee.
In the result, the appeal of the assessee stands allowed for statistical purposes.
Order pronounced in the open Court on 27/01/2025.