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Facts
The assessee, an agriculturist with 60 Bighas of land, deposited a significant amount of cash without filing an Income Tax Return. The Assessing Officer (AO) made additions for unexplained money and interest income under Section 147 read with Section 144 of the Income Tax Act.
Held
The Tribunal condoned the delay in filing the appeal, noting the assessee's lack of awareness due to being a farmer. The Tribunal restored the matter to the AO for fresh adjudication, providing an opportunity for the assessee to present their case, despite the assessee's non-compliance in earlier proceedings.
Key Issues
Whether the assessee's appeal, filed with a significant delay and against an ex-parte order, should be admitted and restored to the AO for fresh adjudication.
Sections Cited
147, 144, 249(4), 69A, 115BBE, 271(1)(b), 271(1)(c), 271F, 142(1), 133(6), 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES,’’SMC” JAIPUR
fu/kZkj.ko"kZ@AssessmentYear : 2016-17 Shri Dharmedra Kumar cuke The ITO Vs. Near Ram Janki Mandi Ward -Baran Bhanwargarh, Kishanganj, Distt: Baran-325 216 Baran LFkk;hys[kk la-@thvkbZvkjla-@PAN/GIR No.: BHLPK 3253 N vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Swapnil Agarwal, CA, (Thru: V.C.) jktLo dh vksjls@Revenue by: Shri Gautam Singh Choudhary, JCIT-DR lquokbZ dh rkjh[k@Date of Hearing : 22/07/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: : 11/08/2025 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This appeal filed by the assessee is directed against the order of the ld. CIT(A) dated 01-02-2024, National Faceless Appeal Centre, Delhi [ hereinafter referred to as (NFAC)/ CIT(A) ] for the assessment year 2016- 17 raising therein following grounds of appeal; ‘’Assessee was an agriculturist holding approx.
60. Bigha agriculture land in village Bhanwaargarh. Assessee never filed ITR, during the year under consideration assessee deposited Rs.16,03,000/- in Baran KendriyaSahkari Bank Ltd. Source of above cash deposit was that assessee having agriculture income only which is exempt under Income Tax Act. Assessee hold
60. Bighas agriculture land since last 25 years. If we consider agriculture income of Rs.10,000/- per Bigha @ for 60. Bigha it comes to Rs.6,00,000/- per year. After all DHARMENDRA KUMAR VS ITO, WARD- BARAN expenses if he saves Rs.3,00,000- then also for last 10 years cash balance may be upto Rs.30,00,000/- be held. Assessee also withdrawal cash balance on different dates i.e. on 7-05-2015 Rs.5,00,000/- from Baran KendriyaSahakari Bank, Rs.1,99,000/- from CBI on dated from 29-07-2015 to 18-08-2015, then Rs.6,00,000/- on dated 24-12-2015 from CBI. So now we would like to say that having agriculture income only which arise only in cash. Please consider the request.’’ 2.1 During the course of hearing, the Bench noted that there is delay of 189 days in filing the appeal by the assessee for which the ld. AR of the assessee has filed an application dated 23-04-2025 with the request to condone the delay in filing the appeal and reasoning mentioned in the application for condonation is narrated hereunder:- ‘‘CIT(A) passed the order on dated 01-02-2024. Appeal before ITAT be filed within 2 months from receipt of order. Order was sent to on Income Tax Portal but there was no one who check the portal and provide copy of order. Manual copy of order was also not received by the assessee then the assessee came with recovery notice issued by the Department. Then we as authorized representative downloaded the order and filed appeal. The cause of delay occurred in filing the appeal by the assessee was being a farmer and having no awareness of income tax proceedings. So there is reasonable cause that the assessee had no knowledge of order. As soon as, he knew about recovery demand then he tried to file the appeal.’’ To this effect, the assessee Shri Dharmendra Kumar (Deponent) has filed an affidavit deposing therein of the above facts. 2.2 On the other hand, the ld DR objected to such inordinate delay but at the same time did not dispute the content of the application made and submitted that the Court may decide the issue as deemed fit and proper in the case.
DHARMENDRA KUMAR VS ITO, WARD- BARAN 2.3 We have heard both the parties and perused the materials available on record. In this case, it is noted that the assessee is a farmer who has no knowledge about the issuance of the order passed by the ld. CIT(A) dated on 01-02-2024 on the portal of the revenue. The assessee came to know about the passing of ld. CIT(A)’s order when the recovery notice was issued by the Department. Thus, from the above, it appears that the assessee was prevented by sufficient cause in late filing the appeal before ITAT. Hence, in view of the above facts and circumstances of the case, the Bench condones the delay in fling the appeal by the assessee. 3.1 Apropos grounds of appeal
, it is noticed that the ld. CIT(A) has passed an ex-part order in the case of the assessee for the reason that the assessee neither complied nor furnished any reply to the deficiency letters. The ld. CIT(A) inferred that the assessee does not have anything to say in this matter. Hence, the ld. CIT(A) has not admitted the appeal as per provisions of Section 249(4) of the Act and dismissed the appeal of the assessee by observing at para 2.2 to 3 as under:- 2.2. The appellant has not complied and has not furnished any reply to the deficiency letters. Therefore, it can be safely inferred that the appellant does not have anything to say in this matter 2.3. In this regard, provisions of Section 249(4) of the Act, is reproduced here under "[(4) No appeal under this chapter shall be admitted unless at the time of filing of the appeal- DHARMENDRA KUMAR VS ITO, WARD- BARAN
1. Where a return has been filed by the assessee, the assessee has paid the tax due on the income returned by him, or 2. Where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance tax which was payable by him. Provided that [in a case falling under clause (b) and) on an application made by the appellant in this behalf, the [Joint Commissioner (Appeals) or the] [Commissioner (Appeals), may for any good and sufficient reason to be recorded in writing, exempt him from the operation of the provisions of [that clause]]’’ 2.4. As per the assessment order under section 147 r.w.s 144 of the Act, it is stated that the appellant has not filed the return of income and the AO has computed the total income at Rs. 18,23,254/-on account of unexplained money u/s 69A, interest Income and computed the tax on the assessed income which includes the advance tax payable by the appellant as well as the interest on account of delayed payment of advance tax 2.5. As per the deficiency letter, the details of deficiency is "Tax on returned income not paid/particulars of payment not mentioned which includes two parts, one part is tax on returned income not paid and secondly particulars of payment not mentioned The second part of the provision is applicable to the case of the appellant. Particulars of payment not mentioned pertains to Section 249(4)(b) of the Act, which is particulars of payment of advance tax as per the said provision. It is seen that the appellant has not responded to the deficiency letters goes to suggest that the appellant has not paid an amount equal to the amount of advance tax which was payable by him, on or before filing the appeal. Moreover, the appellant has also not made an application as per the Proviso to Section 249(4). 2.6. In this regard, the Column nos. 8 & 9 of Form No. 35 is reproduced here under:-
8. Where a return has been filed by Not applicable the appellant for the Not assessment year in connection with which the appeal is filed Applicable whether tax due on income returned has been paid in full 8.1 If reply to 8 is Yes, then enter details of return and taxes paid a. Acknowledgement number b. Date of filing DHARMENDRA KUMAR VS ITO, WARD- BARAN c. Total Tax paid 9, Where no return has been filed by Not applicable the appellant for the assessment year, whether an amount equal to the amount of advance tax as per section 249(4)(b) of the Income Tax Act 1961 has been paid As can be seen from the above, the appellant has stated "Not Applicable in the above columns. In these columns, the appellant was required to mention the details of return filed and particulars of payment of advance tax prior to filing the appeal respectively, which is not mentioned Therefore, it is clear that, the appellant has not paid an amount equal to the amount of advance tax which was payable on or before filing the appeal. 2.7. As per section 249(4)(b) of the Act, the appeal shall not be admitted, unless the appellant has paid an amount equal to the amount of advance tax which was payable. As the applicable advance tax has not been paid by the appellant before filing of the appeal, the appeal shall not be admitted. Therefore, the present appeal filed is not admitted as per the provisions of Section 249(4) of the Act
3. In the result, the appeal is treated as dismissed for statistical purposes.’’ 3.2 During the course of hearing, the ld. AR of the assessee submitted that the assessee is an agriculturist, and he holds around 60 bighas of agriculture land and he has only agriculture income besides income from bank interest. He submitted that the assessee has not filed the Income Tax Return as he has no taxable income. As regards the total addition of Rs.16,23,254/- so made by the AO wherein Rs.16,03,000/- is treated as unexplained money in bank account u/s 69A of the Act and Rs.20,254/- is treated as bank interest. It is noted that the assessee filed the bank details of Baran KendriyaSahakari Bank Ltd. as well as Central Bank of India, and DHARMENDRA KUMAR VS ITO, WARD- BARAN also submitted the copy of Jamabandiin which holdings of the land is 60 Bigha. He submitted that the assessee may be provided one more opportunity to contest the case before the AO as the assessee has passed an ex-parte assessment order making the total addition of Rs.16,23,250/- in the hands of the assessee. 3.3 On the other hand, ld .DR did not controvert the request of the ld. AR of the assessee to restore the matter to the file of the AO for afresh adjudication. However, the ld. DR filed a letter No.536 dated 27-06-2025 which has been forwarded by the Joint Commissioner Range-2, Kota to him enclosing therewith the report of Shri Jai Kumar Bansal, ITO, Baran whose details are as under:- ‘’Sub: File written submission in the case of Dharmendra Kumar (PAN BHLPK 3253N) A.Y. 2016-17 pending before Hon’ble ITAT, Jaipur Bench – reg. In this connection it is submitted that the submission/Ground of assessee is not acceptable for the following reasons: 1 Assessee has sought to explain the source of cash deposits as being out of agricultural income from is 60 Bigha agricultural land Assessee has merely stated to have agricultural land and has furnished a copy of Jamabandi (Khatoni) of agricultural land. The copy of the above jamabandi is issued only on 18.10.2024 and it clearly says that "इसकाउपयोग�कसीभी�यायालयम�सा�यके�पम�नह�ं�कयाजासकताहै। Moreover, Assessee has not furished the proper documents to prove the agricultural income like documentary evidences of expenses made on agriculture and that of sale of the produce, and other anciliary evidences like transportation of agricultural produce, storage expenses etc. Therefore the explanation of assessee is not acceptable
2. Assessee has sought to explain the source of cash deposits as being out of cash withdrawals form his bank accounts as under:
DHARMENDRA KUMAR VS ITO, WARD- BARAN a Cash withdrawal of Rs. 500000/ on 07.05.2015 from Baran KendriyaSahkari Bank (BKSB) (A/c No. 39007111130010046): The above withdrawal fails to explain the source as the above withdrawal lof Rs.500000/-) has been deposited back on same today ( on 07.05.2015) in his other bank account in Central Bank of India (CBI)(A/C NO. 2230723670) b. Rs.1,99,000/ withdrawal from CBI A/c (from 29.07.2015 to 18.08.2015). The above withdrawal may be accepted as explanation to the cash deposits made subsequent to 29.07.2015. c. Rs.6,00,000/ withdrew from CBI A/c on 24.12.2015: This explanation is not acceptable as assessee has deposited back Rs. 6,84.000/ in same CBI A/c on 31.12 2015.
Further, during the entire verification and assessment proceedings assessee failed in make compliance to the notices issued. And at this stage of second appeal, assessee has furnished another bank account wherein huge transactions have taken place in form of cash deposits and withdrawals. These transactions (esp. cash deposits) were required to be assessed by AO, but in absence of complete information of assessee’s bank accounts, these could not be brought to assessment and tax. Hon'ble Bench may take these unassessed transactions under consideration as the same have deliberately been not disclosed to the AO.
During the entire verification and assessment proceedings, assessee remained non-compliant to the notices issued from time to time. During the verification proceedings, ITO (I&CI) issued as many as five notices us 133(6) and reminders to provide opportunity to provide details of financial transactions etc but no compliance was made.
Dering the course of assessment also, notices u/s 148, 142(1) and show cause notices were issued by the AO and sent by speed post. But all notices returned back with postal comments 'लेनेसेइ�कार�कया 3 Conclusively, it is submitted that out of above transactions, assessee's explanation of Rs. 1,99,000/- (as per para 2(b)) appears acceptable, but the transactions (esp cash deposits) in assessee's hitherto hidden bank account of Central Bank of India (A/c NO. 2230723670) may be taken into consideration and brought assessment and tax.’’ Sd/- (Jai Kumar Bansal) Income Tax Officer, Baran, DHARMENDRA KUMAR VS ITO, WARD- BARAN 3.4 We have heard both the parties and perused the materials available on record. In this case, it is noted that the AO passed an ex-parte order by making addition of Rs.16,23,500/- in the hands of the assessee as the assessee failed to comply with the show cause notice and thus he has no option except to complete the assessment u/s 144 of the Income Tax Act. The relevant narration as made by the AO at page 4 of his order is reproduced as under:- ‘’The assessee again failed to comply the show cause notice also. Therefore, from the facts and circumstances discussed above, it is quite clear that the assessee has nothing to say in the matter. In view of above, I have no option except to complete the assessment/s 144 of the Income Tax Act. Looking to all the facts and circumstances of the case, the total deposits in bank account of Rs.16,03,000/- is treated unexplained money in bank account u/s 69A of the Income Tax Act. (Addition Rs.16,03,000/-) On perusal of detail of Annual tax statement Form 26AS, the assessee has earned interest on bank deposits of Rs.11,517/- during the period under consideration. The assessee received interest from Baran KendriyaSahakari Bank Ltd. Baran of Rs.8,737/-. These amounts are added to the added to the total income of the assessee (Addition Rs.20,254/-) Assessed at Rs.16,23,254/- r/o Rs.16,23,250/- u/s 147 read with section 144 of the Income Tax Act. The assessee has failed to comply notices u/s 142(1) of Income Tax Act, 1961, therefore penalty u/s 271(1)(b) is initiated. The assessee has concealed the particulars of his income, therefore, penalty proceedings u/s 271(1)(c) is initiated. The assessee has not filed his return of income, therefore, penalty proceedings u/s 271F is initiated. Tax u/s 115BBE is charged on Rs.16,03,000/- as per the addition is made u/s 69A. In first appeal, the ld. CIT(A) has not admitted the appeal as per the provisions of Section 249(4) of the Act and thus he dismissed the appeal DHARMENDRA KUMAR VS ITO, WARD- BARAN for statistical purposes. It is an admitted fact that the assessee is ex-parte before the AO and also before the ld. CIT(A). Therefore, he could not put forth his defence. It was the bounded duty of the assessee to appear before the statutory authorities as and when called for. It is noticed that various opportunities were provided to the assessee for settling the issue but the assessee remained lethargic and unserious in pursuing his case. However, the Bench is of the view that lis between the parties has to be decided on merits so that nobody’s rights could be scuttled down without providing opportunity of being heard to the assessee. Hence, the matter is restored to the file of the AO to decide it afresh by providing one more opportunity of hearing, however, the assessee will not seek any adjournment on frivolous ground and remain cooperative during the course of proceedings. Thus the appeal of the assessee is allowed for statistical purposes. 3.5 Before parting, we may make it clear that our decision to restore the matter back to the file of the AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by AO independently in accordance with law.