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Facts
The assessee filed an appeal against the order of the CIT(A) for AY 2015-16. The CIT(A) dismissed the appeal as ex-parte due to delay in filing. Subsequently, the AO passed a rectification order reducing the demand to Nil, rendering the original assessment order infructuous.
Held
The Tribunal noted that the AO's rectification order had made the assessment order infructuous and reduced the demand to Nil. Consequently, the assessee prayed to withdraw the appeal, which was then dismissed as withdrawn.
Key Issues
Whether the appeal is infructuous due to a subsequent rectification order by the AO reducing the demand to Nil, and if so, whether it should be dismissed as withdrawn.
Sections Cited
147, 144, 154, 148, 148A, 69, 115BBE, 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR
Before: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA. No. 1380/JPR/2024
fu/kZkj.k o"kZ@Assessment Years : 2015-16 Shrivinayak Samanvay Buildestates LLP cuke The ITO, Vs. 82-84, Green Colony, Moti Nagar, Ward-1(3), Ganuhi Path, Vaishali Nagar, Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ACOFS8804L vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri R.S. Poonia, C.A. jktLo dh vksj ls@ Revenue by : Mrs. Swapnil Parihar, JCIT-DR a lquokbZ dh rkjh[k@ Date of Hearing : 20/02/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 18 /03/2025 vkns'k@ ORDER PER: DR. S. SEETHALAKSHMI, J.M. This appeal filed by the assessee is directed against the order of the ld. CIT(A) dated 18-09-2024, National Faceless Appeal Centre, Delhi [ hereinafter referred to as (CIT(A)/NFAC) ] for the assessment year 2015-16 raising therein following grounds of appeal.
1. That under the facts and circumstances of the case the Ld. CIT (Appeals) has erred in law and facts in not condoning the delay of appeal which is wrong, unwarranted and bad in law. Kindly condone the delay.
2. That under the facts and circumstances of the case the Ld. CIT (Appeals) has erred in law and facts in confirming the addition of Rs. 2,31,00,000/- imposed by the Ld. A.O. on account of unexplained investment U/S. 69 of the Shri Vinayak Samanvay Buildestates LLP vs. ITO I.T. Act, 1961 which is wrong, unwarranted and bad in law. Kindly delete the same.
That under the facts and circumstances of the case the Ld. CIT (Appeals) has erred in law and facts in charging special rate of tax u/s. 115 BBE of the 1.T. Act, 1961 which is wrong, unwarranted and bad in law. Kindly delete the same.
That the appellant craves the permission to add to or amend to any of the above grounds of appeal or to withdraw any of them.”
2.1 Apropos ground of appeal, it is noticed that the ld. CIT(A) dismissed the appeal of the assessee treating it as an ex-parte order on the ground that the assessee is a habitual defaulter and during the course of appeal proceedings the assessee was accorded various opportunities but the assessee remained unresponsive and there was also delay of 43 days in filing the appeal before him. The narration as made by the ld. CIT(A) at page 19 of his order is reproduced as under:-
‘’There exists no sufficient or good reason for condoning inordinate delays of more than 43 days in filing appeal. Accordingly, this appeal is dismissed as barred by limitation. Accordingly, I decline the delay of 43 days and dismiss this appeal of the appellant as barred by limitation.
In view of the above discussion, appeal is rendered as inadmissible. Hence stand dismissed.’’ Shri Vinayak Samanvay Buildestates LLP vs. ITO 2.2 During the course of hearing, the ld. AR of the assessee has submitted a letter praying that he is withdrawing this appeal as the present appeal is infructuous in view of the rectification order passed by the AO dated 19-05-2023 wherein the AO reduced the demand as Nil. The narration as made by the ld. AR of the assessee in his submission dated 20-02-2025 is reproduced as under:-
‘’Facts of the case:-
1. 1. That assessment order was passed by Ld. A.O. u/s. 147r.w.s. 144 of the Act on 20.03.2022 by making an addition of Rs. 2,31,00,000/- . Copy of assessment order 20.03.2022 is enclosed.
2. That on 31.05.2022, assessee-firm filed an appeal before CIT (Appeals) against the assessment order dated 31.05.2022. Copy of acknowledgement of Form 35 is enclosed.
3. That meanwhile the Ld. A.O. passed a rectification order u/s. 154 of the Act, on 19.05.2023 and the finding mentioned in last para of rectification order made by Ld. A.O. is as follows:- "In view of the above, the fresh reassessment proceedings u/s 148 for the AY 2015'16 initiated on 28.07.2022, is pending in this case. Therefore, the assessment order was passed on 20.03.2022 has become infructuous and null & void hence the Assessment order passed on 20.03.2022 is rectified and demand is reduced to Nil accordingly. Copy of rectification order dated 19.05.2023 is enclosed. Our Submission:- 1. That the assessment order dated 20.03.2022 as well as CIT (Appeal) order dated 18.09.2024 becomes infructuous, as the rectification order was passed and the demand is reduced to Nil.
2. In light of the above facts, the present appeal is infructuous, therefore we are withdrawing this present appeal. Kindly allow us to withdraw this present appeal.’’ 2.3 On the other hand, the ld. DR supported the order of the ld.CIT(A).
2.4 We have heard both the parties and perused the materials available on record. In this case, it is noticed that the AO vide his order dated 20-03-2022 passed an ex-parte order by making an addition of Rs.2.31 Crores in the hands of the assesseee by observing as under:-
‘’4.2 Despite sufficient number of opportunities have been given to the assessee. No compliance has been made by the assessee. Therefore, the details related to source of purchase of property, genuineness of transaction could not be verified. Hence, the investment made of Rs.2,31,00,000/- for purchase of property is being treated as unexplained investment of the assessee. 4.3 In view of the above facts, circumstances of the case and in absence of any reply/ documentary evidences / information/ details in support of purchase of immovable property, the department has no other option except to complete the assessment on the basis of material available on record. Therefore, the purchase of the immovable property of Rs.2,31,00,000/- is being treated as the unexplained investment of assessee u/s 69 of the I.T. Act, 1961 and taxed in accordance with the provision of Section 115BBE of the Act. Hence, the same is added back to the income declared in ITR.’’ In first appeal, the ld.CIT(A) has also passed an ex-parte order by declining the condondation of delay of 43 days in filing the appeal by the assessee and thus dismissed the appeal as mentioned hereinabove. It is pertinent to mention that the AO has passed an order dated 19-05-2023 making rectification in the assessment order passed u/s 147/ 144B of the DIN: ITBA/REC/M/154/2023-24/1052987004(1) DT. 19/05/23 INCOME –TAX DEPARTMENT Name and address of the Assessee Shri Vinayak Samanvay Buildestates LLP 82-84, Green Colony, Moti nagar, Gandhi Path, Vaishali Nagar, Jaipur-302021. PAN ACOFS8804L Status Firms Assessment Year 2015-16 Date of order 19.05.2023 Rectification of Assessment Order passed u/s 147/144B of the I.T. Act In compliance to the decision of Hon'ble Supreme Court dated 04.05.2022 in the case of UOI vs Ashish Agarwal and consequent CBDT Instruction No 01/2022/F.No 279/Misc/M-51/2022-ITJ dated 11/05/2022, that the information and material relied upon for initiating reassessment proceedings is to be provided to the assessee in all cases where notice u/s 148 issued & served after 31.03.2021. Therefore In this case the notice was issued on 08.04.2021. Therefore, an opportunity by way of issuance of letter with information and material relied upon for Initiating reassessment proceedings was provided to the assessee. After considering the facts of the case as well as reply furnished by the assessee, the fresh reassessment proceedings u/s 147 of the I.T. Act has been initiated in the case of Shri Vinayak Samanvay Buildestates LLP for AY 2015-16 and fresh notice u/s 148 has been issued to assessee on 28/07/2022 by passing order u/s 148A(d) on 28/07/2022 after getting approval from the PCIT-1, Jaipur vide No.1192 dated 23.07.2022. In the present case the assessment order was passed order u/s 147/144 r.w.s 1448 of the I.T. Act on 20/03/2022 by faceless AO against the notice issued earlier notice u/s 148 dated 09.04.2021 by making additions of Rs. 2,31,00,000/-and raised demand of Rs.1,53,10,710/- In view of the above, the fresh reassessment proceedings u/s 148 for the AY 2015-16 Initiated on 28.07.2022, is pending in this case. Therefore, the assessment order was passed on 20.03.2022 has become infructuous and null & void hence the Assessment order passed on 20.03.2022 is rectified and demand is reduced to Nil accordingly.