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Facts
The assessee, Shri Maneesh Joshi, did not file his income tax return for AY 2018-19. The AO initiated assessment proceedings under Section 147 r.w.s. 144, making additions for unexplained money, expenditure, sale of motor vehicle, and cash credit, totaling Rs. 7,93,80,493/-.
Held
The Tribunal held that while the assessee was lethargic and failed to respond to notices, the case should be decided on merits. Therefore, the matter was restored to the AO for fresh adjudication.
Key Issues
Whether the appeal should be decided on merits despite the assessee's non-cooperation and ex-parte proceedings, and if so, should the matter be remanded for fresh adjudication.
Sections Cited
147, 144, 69A, 69C, 68, 115BBE, 271AAC(1), 270A, 272A(1)(d), 148, 156, 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES,”A’’ JAIPUR
ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM The assessee has filed an appeal against the order of the ld. CIT(A), National Faceless Appeal Centre, Delhi dated 27-03-2025 [hereinafter referred as “(CIT(A)/NFAC” ] for the assessment years 2018-19 in the matter of Section 147 r.w.s. 144 of the Income Tax Act, 1961 and thus raising therein following ground of appeal:- ‘’1. That on the facts and in the circumstances of the case the Ld. CIT (Appeals), NFAC is wrong, unjust and has erred in law and facts in confirming the addition u/s. 69A of the I.T. Act 1961 amounting to Rs. 22,83,000/- on account of unexplained money, Kindly delete the addition.
2. That on the facts and in the circumstances of the case the Ld. CIT (Appeals), NFAC is wrong, unjust and has erred in law and facts in confirming the addition u/s. 69C of the I.T. Act 1961 amounting to Rs. 1,41,50,500/- on account of unexplained expenditure. Kindly delete the addition.
3. That on the facts and in the circumstances of the case the Ld. CIT (Appeals), NFAC is wrong, unjust and has erred in law and facts in confirming the addition amounting to Rs. 15,00,950/- on account of sale of motor vehicle as Income from Other Sources. Kindly delete the addition.
4. That on the facts and in the circumstances of the case the Ld. CIT (Appeals), NFAC is wrong, unjust and has erred in law and facts in confirming the addition u/s. 68 of the IT. Act 1961 amounting to Rs. 6,14,46,043/- on account of unexplained cash credit. Kindly delete the addition.
5. That on the facts and in the circumstances of the case the Ld. CIT (Appeals), NFAC is wrong, unjust and has erred in law and facts confirming the tax at special rate u/s. 115BBE of the I.T. Act, 1961 is wrong and bad in law.
2.1 Brief facts of the case are that the Assessment Unit, Income Tax Department i.e. AO while making assessment in the case of the assessee observed that the assessee is an individual who has not filed the return of income for the assessment year 2018-19. The Notice u/s 148 had been issued on 30-03-2022 vide DIN & Notice No. ITBA/AST/S/1481/2021- 22/1042152249(1). In response to notice u/s 148 of the Act, the assessee had not filed his return of income for the assessment year under consideration. The AO further noted that as per the information available on record, the source of income of the assessee is not known as the assessee did not file the return of income for the year under consideration. The AO further on going through the records found that as per the following transactions mentioned in the assessment order did not offer tax and due tax had not been paid. ‘’1. The assessee has made cash deposits amounting to Rs.22,83,000/- in HDFC Bank different accounts.
The assessee has made substantial cash withdrawals amounting to Rs.1,41,50,500/-.
The assessee has also made sale / purchase of vehicle amounting to Rs.15,00,950/-.
The assessee has received contractual payment amounting to Rs.5,54,15,413/- & Rs.60,30,630/- (totaling to Rs.6,14,46,043/-) during the F.Y. 2017-18 i.e. A.Y. 2018-19. It is noted from the records that the AO had given multiple opportunities but the assessee failed to submit the return of income in response to notice u/s 148 of the Act. Hence, in this view of the matter the AO concluded that the assessee had not offered any explanation, and he made the addition in the hands of the assessee by observing as under:- ‘’i) The Cash deposit made totaling Rs. 22,83,000 during the FY. 2017-18 is determined as Unexplained money u/s 69A of the IT. Act, 1961. The tax is being charged u/s 115BBE of the I.T.Act, 1961. The Penalty u/s 271AAC(1) of the IT. Act 1961 is also been initiated (ii) Cash withdrawal Rs. 1,41,50,500/- is determined as unexplained expenditure u/s 69C of the IT Act 1961. The tax is being charged u/s. 115BBE of the I.T.Act, 1961. The Penalty u/s 271AAC(1) of the IT.Act, 1961 is also been initiated.
(iii) The Sale of motor vehicle amounting to Rs. 15,00,950/- is determined as 'income from other source’ as per the provision of the 1.T.Act, 1961.The Penalty u/s 270A of the I.T.Act, 1961 is also been initiated. (iv) Receipt of contractual payment amounting to Rs. 5,54,15,413/- & Rs. 60,30,630/- (totaling Rs. 6,14,46,043/-) during the FY 2017-18 relevant to A.Y. 2018-19 is determined as Cash credit u/s. 68 of the IT Act, 1961 of the assessee.The tax is being charged u/s. 115BBE of the 1.T.Act, 1961. The Penalty u/s.271AAC(1) of the 1.T.Act, 1961 is also been initiated The Penalty u/s 272A(1)(d) of the I.T.Act.1961 is also being initiated.’’ 2.2 In first appeal, the ld. CIT(A) has passed an ex-parte order for the reason that the assessee did not offer any explanation before him in spite of affording opportunities to the assessee and thus confirmed the action of the AO by observing as under:- ‘’3. The assessment proceedings were completed by the AO by making the following additions” In the instant case the assessee is an 'Individual' has not filed the return of income (ITR) for the AY 2018-19. Notice U/s. 148 has been issued on 30/03/2022 vide DIN & Notice No. ITBA/AST/S/1481/2021-22/1042152249(1). In response of Notice u/s. 148 of the I.T. Act, 1961 the assessee has not filed his return of income for the assessment year 2018-19. The source of income of the assessee is not known as assessee did not filed ITR for any assessment year as information available on record. In this case specific information was flagged as per Risk Management Strategy formulated by the CBDT through ITBA software under the head "Non Filing of Return (NMS) cases' As per the specific information, Sh. Maneesh Joshi PAN- AGFPJ8810N has carried out following transactions during the financial year 2017- 18, relevant to the assessment year 2018-19: 1. The assessee has made cash deposits amounting to Rs. 22,83,000/-in HDFC Bank different accounts
2. The assessee has made substantial cash withdrawals amounting to Rs. 1,41,50,500/- 3. The assessee has also made sale/purchase of vehicle amounting to Rs. 15,00,950/-. The assessee has received contractual payment amounting to Rs. 5,54,15,413/- & Rs. 60,30,630/- (totaling to Rs. 6,14,46,043/-) during the FY 2017- 18 i.e. AY 2018-19. 4. On going through the records it is seen that the assessee has not filed return of income for the AY 2018-19. Therefore, it is established that the above mentioned transactions have not been offered for tax and due tax has not been paid. U/s 147 r.w.s 144B of the Income-tax Act, Penalty proceedings under section 271(1)(c) & 271(1)(b) Income Tax Act has been initiated through notice(s) issued separately. Computation of income and demand notice u/s.156 of the Act is attached. 4. Details of opportunity accorded and communicated to the appellant is furnished in the following table: 5.Details of notices issued are as under:-
S.N. Date of notice Din No. Date of Compliance Remarks 1 21-06-2024 ITBA/NFAC/F/APL-1/2024- 28-06-2024 Adjournment 25/1065902044(1) filed (25-06- 2024) 2. 11-11-2024 ITBA/NFAC/F/APL-1/2024- 26-11-2024 No response 25/1070246624(1)
As noted from the facts of the case and material available on record, it is seen that the Assessing Officer made the above additions, based on materials available on record, after according proper and adequate opportunity to the appellant and after marshalling the facts. The appellant did not produce any evidence in support of his claim or made any response against the various notices issued from time to time during the entire assessment proceedings.As per 69A of the Income Tax Act, 1961:- "Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of Income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the 4 Assessing) officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.]" Till the date of passing of this order even though the response window was open, the appellant-assessee has failed to file any response. Hence, it is held that the assessment order passed by the Assessing Officer u/s 147r.w.s144 of the Act, resulting into the assessed income amounting to Rs. 7,93,80,493/-, based on his findings and proper adjudication, is quite in order, and the same is hereby confirmed. Accordingly, Grounds of appeal
of the appellant are dismissed.
7. In the result, the appeal is dismissed.’’ 2.3 During the course of hearing, the ld.AR of the assessee prayed that the assessee may be provided one more chance to contest the case before the AO and also to adduce the documents relating to addition so made by him with a view to settling the apple of discord. He also submitted that both the authorities had passed ex-parte orders for which the assessee had not received any communication to counter the same. Hence, the ld. AR of the assessee repeated his submission to restore the matter to the file of the AO for afresh adjudication. 2.4 On the other hand, the ld. DR objected to the submissions of the ld. AR of the assessee and he relied upon the orders of the lower authorities. 2.5 The Bench heard both the parties and perused the materials available on record. In this case, it is noted that the AO assessed the income of the assessee-individual amounting to Rs.7,93,80,493/- which is a voluminous amount for which the assessee in the interest of equity and justice is required to contest the case before the AO and to adduce the documents/evidence. It is pertinent to mention that since 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 whileset aside proceedings. Thus the appeal of the assessee is allowed for statistical purposes.
2.6 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. 3.0 In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 09 /07/2025.
Sd/- Sd/- ¼Mk0 ,l- lhrky{eh ½ ¼jkBksMdeys'kt;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;dlnL;@Judicial Member ys[kklnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 09/07/2025 *Mishra आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. vihykFkhZ@The Appellant- Shri Maneesh Joshi, Dausa 2. izR;FkhZ@The Respondent- ITO, Ward- Dausa. 3. vk;djvk;qDr@CIT 4. विभागीय प्रतिनिधि] आयकरअपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत. 5. xkMZQkbZy@Guard File { } vkns'kkuqlkj@By order
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