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Facts
An ex-parte assessment order under Section 147 r.w.s. 144 was passed against the assessee for A.Y. 2019-20, assessing income at Rs. 20,03,400/-, as the assessee had not filed ITR or responded to the Section 148 notice. The Ld. CIT(A) dismissed the first appeal under Section 246A, holding it infructuous due to the assessee's non-filing of ITR and non-payment of advance tax, without deciding on the merits of the additions.
Held
The Tribunal held that the CIT(A) erred in law by dismissing the appeal without first determining the real income of the assessee and tax liability at the original assessment stage. The Tribunal set aside the CIT(A)'s order and remanded the case back to the Assessing Officer for a fresh de novo assessment on merits, ensuring full opportunity is provided to the assessee for correct determination of income.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal as infructuous due to non-filing of Income Tax Return and non-payment of advance tax, and whether the original assessment was validly conducted without proper notice and determination of income sources.
Sections Cited
253, 147, 144, 148, 246A, 249(4), 69A, 115BBE
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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M JOSHI
आदेश / O R D E R
Per Paresh M Joshi, J.M.:
This is an appeal filed by the assessee Under Section 253 of the Income Tax Act, 1961 (hereinafter referred to as the “Act” for sake of brevity) before this Tribunal. The assessee is aggrieved by the order bearing Number ITBA/NFAC/S/250/2024- 25/1070145763(1) dated 06.11.2024 passed by the Ld. CIT(A) which is hereinafter referred to as the “Impugned order”. The Page 1 of 7 previous year period is from 01.04.2018 to 31.03.2019.
FACTUAL MATRIX 2.1 That as and by way of an assessment order made u/s 147 r.w.s. 144 of the Act, the assesee’s total income exigible to tax was computed and assessed at Rs.20,03,400/-. The assessee has not filed his Income Tax Return for Assessment Year 2019-20 and so also in response to notice u/s 148. That the aforesaid assessment order bears No. ITBA/AST/S/147/2023- 24/1063525769(1) and that same is dated 28.03.2024 which is hereinafter referred to as the “impugned assessment order”.
2.2 That the assessee being aggrieved by the aforesaid “impugned assessment order” prefers first appeal u/s 246A of the Act before the Ld. CIT(A) who by the “impugned order” has dismissed the appeal of the assessee on the grounds and reasons stated therein. The core ground being that the assessee has not filed the Return of Income as well as not paid an amount equal to the amount of advance tax which was payable and therefore appeal is not liable to be admitted. The appeal is infructuous and is therefore dismissed.
Page 2 of 7 has preferred the instant second appeal before this Tribunal and has raised following grounds of appeal in Form No.36 against the “impugned order” which are as under:-
“1. That on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in not admitting the appeal and treating the appeal as infructuous in light of the provisions of section 249(4) of the Act without properly appreciating the facts of the case even when there was no liability on the appellant to pay tax on his income
2. That on the facts and in the circumstances of the case and in law, the Ld. Assessing Officer erred in making addition of Rs. 10,00,000/- to the total income of the appellant on account of cash deposited in the bank account by treating it as unexplained money under section 69A r.w.s. 115BBE of the Act without properly appreciating the facts of the case
3. That on the facts and in the circumstances of the case and in law, the Ld. Assessing Officer erred in making addition of Rs. 9,67,200/- to the total income of the appellant on account of investment in time deposits by treating it as unexplained money under section 69A r.w.s. 115BBE of the Act without properly appreciating the facts of the case
That on the facts and in the circumstances of the case and in law, the Ld. Assessing Officer erred in making addition of Rs. 36,200/- to the total income of the appellant on account of interest income from Narmada Malwa Gramin Bank and Bank of India by treating it as income from other sources under section 69A r.w.s. 115BBE of the Act without properly appreciating the facts of the case
5. That on the facts and in the circumstances of the case and in law, the Ld. Assessing Officer erred in making various additions to the total income of the appellant even though the appellant is an agriculturist whose only source of income is from carrying out agricultural activities
The appellant reserves the right to add, alter and modify the grounds of appeal as taken by him”.
Record of Hearing 3.1 The hearing in the matter took place before this Tribunal on 23.06.2025 when the Ld. AR for and on behalf of the assessee appeared before us and interalia contended that the “impugned assessment order” is an ex-parte order and as per para 2 of it there is absolutely no communication from the department to the assessee. No notice(s) were ever served to the assessee while the original assessment proceedings were being conducted by the department. It was stated that the assessee “source” of income is from agriculture. The assessee has interest income also.
Assessee is an individual. The assessee’s income is below taxable limit and therefore there is no advance tax liability on him. The “impugned order” is wrong, illegal and not proper and Ld. CIT(A) has wrongly invoked Section 249(4) of the Act. Per contra Ld. DR stated that the orders of both the authorities below i.e. of the Ld. A.O and of Ld. CIT(A) are not on merits and it would be just fair and convenient that matter be remanded back to Ld. A.O for correct determination of income of the assessee in a manner known to law.
Page 4 of 7 4.1 We now have to decide the legality, validity and the proprietery of the “impugned order” basis records of the case and rival contentions canvassed before us.
4.2 We have carefully perused the records of the case as presented to this Tribunal by both Ld. AR & Ld. DR to determine the legality, validity of the “impugned order” basis law and by following due process .
4.3 We observe on bare simple perusal of the “impugned order” that the Ld. CIT(A) has treated the 1st appeal of the assessee as not liable to be admitted as no Income Tax Return is filed and no advance tax is paid. We are therefore of the considered view that Ld. CIT(A) has grossly erred in law as real income of the assessee at original stage is not computed and assessed according to law by following due process. Whether or not assessee is liable to file Return of Income or not is to be decided basis inquiry at original stage of assessment proceedings as per law. What is the nature of his income and it’s sources must be ascertained first in quasi judicial manner. The question
Page 5 of 7 arise.
4.4 In the circumstances, we set aside the “impugned order” and remand the case back to the file of Ld. A.O to pass a fresh order on denovo basis.
Order 5.1 In the premises drawn up by us we set aside the “impugned order” as and by way of remand with a direction to the Ld. A.O to pass a reasoned order on merits after giving full and complete opportunities to the assessee. Further we direct assessee to cooperate with the department and not to seek unnecessary adjournments on flimsy grounds. Assessee is directed to furnish his correct e-mail id and so also postal address.
5.2 In the result appeal of the assessee is allowed for statistical purpose.
Order pronounced in open court on 26.06.2025.