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Facts
The assessee, a non-filer, allegedly made significant cash deposits in their bank account. The Directorate of Income Tax (Systems) flagged this information. Despite notices and opportunities, the assessee did not respond. The Assessing Officer made an addition under Section 69A of the Income Tax Act. The CIT(A) dismissed the assessee's appeal.
Held
The Tribunal observed that the assessee was non-participative before the AO and CIT(A). The appeal was time-barred, and the condonation of delay was granted liberally. However, due to lack of findings and the assessee's non-cooperation, the matter was restored to the AO for a de-novo assessment.
Key Issues
Whether the additions made under Section 69A were justified, and whether proper procedure was followed during the assessment and appellate proceedings, especially considering the assessee's non-participation.
Sections Cited
139, 148, 147, 250, 282, 133(6), 69A, 144, 151, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCH “A”, JAIPUR
Before: SHRI GAGAN GOYAL & SHRI NARINDER KUMAR
These two appeals by assessee are directed against the order of NFAC, Delhi dated 09.09.2024 passed u/s. 250 of the Income Tax Act, 1961 (in short ‘the Act’) for A.Ys. 2014-15 & 2015-16. for A.Y 2014-15, the assessee has raised the following grounds of appeal:
1. Because the impugned order dated 09/09/2024 passed by the Ld Commissioner (Appeal), NFAC is bad in law as the same has been passed without considering the actual facts of the case, which is quite unfair and against the principle of natural justice.
2. Because the impugned order dated 09/09/2024 passed by the Ld Commissioner (Appeal), NFAC is bad in law as the same has been passed ex-parte without giving proper opportunity of being heard to the Appellant. The Notices issued under section 250 of the Act were merely uploaded on Portal and no communication was made by other modes specified under section 282 of the Act.
3. Because the impugned order passed by the Ld CIT(Appeals), NFAC is bad in law as the same has not been passed in accordance with the provisions of sub section (6) of section 250 of the Act. The grounds of appeal raised by the Appellant were disposed off mechanically without properly appreciating the facts of the Case and ignoring the correct facts narrated by the Appellant while filing of appeal.
4. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT (A) has erred in law in confirming the validity of issuance of Notice dated 31.03.2021 under section 148 of the Income Tax Act ignoring the vital fact that there was no income much less the income chargeable to tax, within the meaning of section 147 of the Act was escaped assessment for the relevant Assessment year.
5. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law and on facts in confirming the validity of issuance of Notice dated 31.03.2021 under section 148 of the Income Tax Act ignoring the important fact that there were no reasons to believe, as the Appellant had duly explained the source of income from which such cash deposits were made in the Bank Account.
6. BECAUSE, upon the facts and in overall circumstances of the case the appellant denies its liability in terms of Notice dated 31.03.2021 issued under section 148 of the Income Tax Act, as no enquiry/ investigation was made by the Ld Assessing officer before issuing notice under section 148 of the Act.
7. BECAUSE, upon the facts and in overall circumstances of the case the appellant denies its liability in terms of Notice dated 31.03.2021 issued under section 148 of the Income Tax Act, as no sanction / approval of Principal Commissioner of Income Tax was taken under section 151 of the Income Tax Act and not provided to the Appellant.
8. BECAUSE, upon the facts and in overall circumstances of the case the ld CIT (A) has erred on facts and law in confirming the order passed by the ld Assessing officer, which is bad in law and on facts as the same was passed under section 144 of the Income Tax without complying the provisions of section 144 of the Act. The Judgment passed cannot said to be a best judgment assessment in the absence of any enquiry/ investigation on the part of ld Assessing officer.
9. BECAUSE, upon the facts and in overall circumstances of the case the Assessment order dated 21/03/2022 passed by the Assessing Officer and confirmed by the Ld CIT (A), NFAC is bad in law and on facts, as the Addition made of Rs 1,28,58,715.00 u/s 69A of the Act is totally incorrect., unjust and illegal as these cash deposits were on account of sales proceeds from the business of trading of liquor. Thus there was no justification of making an addition of Rs. 1,28,58,715.00, being the amount of so-called cash deposits in Bank Account.
10. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) was wrong, unjust and arbitrary in confirming the addition of Rs. 1,28,58,715.00 made by the Ld Assessing officer under section 69A of the Act without properly appreciating the facts of the case.
11. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT (A) was wrong, unjust and arbitrary in confirming the provisions of section 115BBE of the Income Tax Act invoked by the Assessing officer without properly appreciating the facts of the case.
The appellant craves leave to add or alter one or more ground (s) during the course of hearing of appeal. In A.Y 2015-16, the assessee has raised the following grounds of appeal:
Because the impugned order dated 09/09/2024 passed by the Ld Commissioner (Appeal), NFAC is bad in law as the same has been passed without considering the actual facts of the case, which is quite unfair and against the principle of natural justice.
2. Because the impugned order dated 09/09/2024 passed by the Ld Commissioner (Appeal), NFAC is bad in law as the same has been passed ex-parte without giving proper opportunity of being heard to the Appellant. The Notices issued under section 250 of the Act were merely uploaded on Portal and no communication was made by other modes specified under section 282 of the Act.
Because the impugned order passed by the Ld CIT(Appeals), NFAC is bad in law as the same has not been passed in accordance with the provisions of sub section (6) of section 250 of the Act. The grounds of appeal raised by the Appellant were disposed off mechanically without properly appreciating the facts of the Case and ignoring the correct facts narrated by the Appellant while filing of appeal.
4. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT (A) has erred in law in confirming the validity of issuance of Notice dated 27/02/2023 under section 148 of the Income Tax Act ignoring the vital fact that there was no income much less the income chargeable to tax, within the meaning of section 147 of the Act was escaped assessment for the relevant Assessment year.
5. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) has erred in law and on facts in confirming the validity of issuance of Notice dated 27.02.2023 under section 148 of the Income Tax Act ignoring the important fact that there were no reasons to believe, as the Appellant had duly explained the source of income from which such cash deposits were made in the Bank Account.
6. BECAUSE, upon the facts and in overall circumstances of the case the appellant denies its liability in terms of Notice dated 27.02.2023 issued under section 148 of the Income Tax Act, as no enquiry/ investigation was made by the Ld Assessing officer before issuing notice under section 148 of the Act.
7. BECAUSE, upon the facts and in overall circumstances of the case the appellant denies its liability in terms of Notice dated 27.02.2023 issued under section 148 of the Income Tax Act, as no sanction / approval of Principal Commissioner of Income Tax was taken under section 151 of the Income Tax Act and not provided to the Appellant.
8. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT (A) has erred on facts and law in confirming the order passed by the Ld Assessing officer, which is bad in law and on facts as the same was passed under section 144 of the Income Tax without complying the provisions of section 144 of the Act. The Judgment passed cannot said to be a best judgment assessment in the absence of any enquiry/ investigation on the part of Ld Assessing officer.
9. BECAUSE, upon the facts and in overall circumstances of the case the Assessment order dated 27/02/2023 passed by the Assessing Officer and confirmed by the Ld CIT (A), NFAC is bad in law and on facts, as the Addition made of Rs 94,33,000.00 u/s 69A of the Act is totally incorrect., unjust and illegal as these cash deposits were on account of sales proceeds from the business of trading of liquor. Thus there was no justification of making an addition of Rs. 94,33,000.00, being the amount of so-called cash deposits in Bank Account.
10. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT(A) was wrong, unjust and arbitrary in confirming the addition of Rs. 94,33,000.00 made by the ld Assessing officer under section 69A of the Act without properly appreciating the facts of the case.
11. BECAUSE, upon the facts and in overall circumstances of the case the Ld CIT (A) was wrong, unjust and arbitrary in confirming the provisions of section 115BBE of the Income Tax Act invoked by the Assessing Officer without properly appreciating the facts of the case.
12. The appellant craves leave to add or alter one or more ground (s) during the course of hearing of appeal.
The brief facts of the case are that the assessee is amongst the non-filer of return u/s. 139 of the Act. The information in this case has been identified and flagged by the Directorate of Income Tax (Systems), CBDT in accordance with the Risk Management Strategy formulated by the Board as per the provisions of clause (i) of explanation 1 to section 148 of the Act. As per the flagged information, the assessee has made cash deposits (Including through bearer’s cheque) to the tune of Rs. 94,33,000/- in his Canara Bank, A/c No. 1438101024077. A notice u/s. 133(6) of the Act was issued to the banker also to collect the information about assessee with following issues: i). Details of all bank accounts held by the said assessee in F.Y. 2014-15; ii). Copy of all bank statements for the period 01.04.2014 to 31.03.2015 and iii). Copy of account opening form along with all enclosures.
3. Total seven opportunities were given to the assessee vide para 2 of the AO’s order, but there was no response received ever. Ultimately, the case of the assessee was assessed by making addition of Rs. 94.33 Lacs u/s. 69A of the Act. The assessee being aggrieved with this order preferred an appeal before the Ld. CIT(A), who in turn dismissed the appeal of the assessee and confirmed the order of the AO, as before him also there was no participation by the assessee on designated dates as mentioned in para 6 of the appeal order. The assessee being further aggrieved with the order of the Ld. CIT(A), preferred the present appeal before us.
We have gone through the order of the AO, order of the Ld. CIT(A) and lengthy grounds taken before us. It is observed that the assessee’s appeal is time barred by 25 days before us and the assessee filed an application for condonation of delay in filing of appeal without any duly attested affidavit of the assessee. It is also observed that the power of attorney filed by the A/R of the assessee was in duplicate. These two instances are ample to establish that the counsel of the assessee is not well versed with the procedures of the Income Tax Appellate Tribunal and approach is also casual. A huge tax liability is there on the head of the assessee still, the overall approach of the A/R is not appreciable. Further, noted that the numbers of grounds taken in this case are so voluminous and vague, which ultimately leads to wastage of precious time of the bench.
It is further observed that the appeal before the Ld. CIT(A) was also filed belatedly, although the same was condoned by the Ld. CIT(A), but none appeared there also. Here before us also, the A/R of the assessee simply filed statement of facts and grounds of appeal without any evidence/explanation in his favour, based on which the bench can examine the matter and appropriate adjudication/directions can be issued. Still, taking a liberal view looking at the stakes of the assessee, even in absence of valid duly attested affidavit delay is condoned.
6. As discussed, (supra) that the assessee was non-participative before the AO and Ld. CIT(A), we don’t have any findings on record for our adjudication. In view of this, the matter is restored back to the file of Jurisdictional AO for de-novo assessment after giving the assessee a fresh opportunity of being heard and specifically follow the procedure as laid down in section 282 of the Act for service of notice and the assessee is directed to participate in the proceedings without seeking any adjournment and demonstrate full cooperation with the AO in terms of supply of documents, evidences and explanation.
7. In above terms grounds raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
A.Y 2015-16 9. As the facts and issues involved are identical to for A.Y 2014-15 in this appeal also, our finding will apply mutatis mutandis to this appeal also.
In above terms grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.