LATE SHRI. MADAN MOHAN JHAWAR THROUGH LEGAL HEIR PRIYA GILDA,RAISEN, MADHYA PRADESH vs. INCOME TAX OFFICER, RAISEN, MADHYA PRADESH

आदेश/ O R D E R

Per B.M. Biyani, A.M.:

Feeling aggrieved by order of first-appeal dated 25.06.2024 passed by

learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which

in turn arises out of assessment-order dated 28.09.2019 passed by learned

ITO, Raisen u/s 144 of Income-tax Act, 1961 [“the Act”] for Assessment-Year

[“AY”] 2017-18, the assessee has filed this appeal on following grounds:

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Late Shri Madan Mohan Jhawar Through legal heir Priya Gilda ITA No. 633/Ind/2024 - AY 2017-18

“1. On the facts and circumstances of the case and in law, the AO grossly erred in making and the CIT(A) grossly erred in confirming the addition of Rs. 26,98,100/- under section 69A of the Income Tax Act, 1961 (hereinafter referred to as "Act") ignoring the fact that the nature and source of the amount so deposited in bank account is duly explained and the said amount cannot be treated as unexplained as wrongly assessed by AO and further wrongly confirmed by CIT(A). The addition of Rs. 26,98,100/- under section 69A is grossly illegal and deserves to be deleted as per law and in the interest of justice. 2. On the facts and circumstances of the case and in law, the addition made in 69A is grossly illegal and deserves to be deleted as per law and in the interest of justice. 3. The Appellant denies liability to be assessed to tax under section 115BBE as charged. 4. The Appellant denies liability to be assessed to interest under section 234A of the Act as charged. Without prejudice, the levy of interest is unjustified, unwarranted, and excessive. 5. The Appellant craves leave to add, amend, alter, vary, and / or withdraw the above ground of appeal with the kind permission of the Hon'ble Tribunal.” 2. The assessee in this case is “Shri Madan Mohan Jhawar” who has

deceased and the assessee’s daughter “Priya Gilda” has filed present appeal

in the capacity as Legal Heir. Accordingly, the case title is “Late Shri Madan

Mohan Jhawar Through Legal Heir - Priya Gilda”.

assessee-individual did not file return of income for AY 2017-18. The ITO,

Ward-1, Chindwara, on the basis of information available in Insight Portal of

Income-tax Department regarding cash deposits of Rs. 26,98,100/- made by

assessee in Bank A/c during the demonetization period (09/11/2016 to

30/12/2016) falling within AY 2017-18, issued notice dated 13.12.2017 u/s

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142(1) calling the assessee to furnish return but the assessee did not

comply with notice. Thereafter, the case of assessee was transferred to ITO,

Raisen [“AO”] on 01.08.2019. The AO issued show-cause notice dated

02.09.2019 to assessee proposing for completion of assessment ex-parte u/s

144 on the basis of material available on record. The AO also issued a notice

u/s 142(1) calling various details from assessee as well as explanation qua

the source of deposits. These notices issued by AO also remained

uncompiled by assessee. Ultimately, finding no response from assessee, the

AO completed assessment to the best of his judgement treating the deposits

of Rs. 26,98,100/- as unexplained money u/s 69A and thereby assessing

total income at Rs. 26,98,100/-. Aggrieved, the assessee carried matter in

first-appeal but did not get any success. Now, the assessee has come in next

appeal before us challenging the orders of lower-authorities.

perused the orders of lower-authorities as well as the documents filed in

Paper-Book to which our attention has been drawn.

due to non-compliances of various statutory notices issued to assessee. The

AO has treated the deposits in bank a/c as unexplained money u/s 69A

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since no detail/document was filed by assessee explaining the source of

deposits. During first-appeal, the assessee filed a reply to CIT(A), copy of

same is filed at Pages 15-17 of Paper-Book and the same is also re-produced

verbatim by CIT(A) in Para 5 of impugned order; we refrain to re-produce the

same for the sake of brevity. Suffice it to mention that in the reply so filed,

the assessee submitted that the impugned deposits in bank a/c were made

from two sources, namely (i) cash of Rs. 24,22,346/- withdrawn from KCC

A/c maintained for agricultural activity was re-deposited, and (ii) the cash

receipt of Rs. 8,99,656/- generated from sale of crop was utilized. The

assessee filed supporting documents in the shape of (i) statement of Bank

A/c No. 03470100000005 maintained with UCo Bank from which the

impugned cash-withdrawals were made and (ii) copies of payment-vouchers

issued by Krishi Upaj Mandi Samiti, Bareli through which the sale-proceed

of crop was received. Copies of these documents are also filed at Pages 18-

22 of Paper-Book to which our attention is drawn during hearing. Since the

assessee did not make any representation to AO during assessment-

proceedings but filed submission/documents for the first time before CIT(A),

the CIT(A) forwarded assessee’s documents to AO seeking remand-report.

The AO submitted remand-report dated 24.05.2024 which is re-produced by

CIT(A) in Para 6 of impugned order. In Remand-Report, the AO made certain

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Late Shri Madan Mohan Jhawar Through legal heir Priya Gilda ITA No. 633/Ind/2024 - AY 2017-18

adverse comments qua the documents filed by assessee and therefore the

CIT(A) issued notices dated 27.05.2024 & 20.06.2024 asking the assessee to

furnish reply, if any, in the light of Remand-Report but the assessee failed to

respond to those notices issued by CIT(A) [Para 7 of impugned order of

CIT(A)]. Therefore, the CIT(A) dismissed assessee’s appeal without granting

any relief by concluding thus in Para 9 and 10 of impugned order:

“9. Decisions: By the ground (only one) filed in the Form No. 35, the appellant has objected to invoking of provisions of section 69A and treating entire cash deposit as unexplained money. In this regard, the submission / additional evidences, made by the appellant before the Faceless Appeal i.e. NFAC, the remand report was called for from the Assessing Officer. The findings, submitted by the AO through the remand report dated 24/05/2024, are as under: "It is pertinent to mention here that the credit limit is only Rs.5,66,000/- during the F.Y. 2016-17. Therefore, the claim of the assessee that he has withdrawn Rs. 24,22,346/- from KCC account on the following date 02/02/2016, 14/01/2016 and 17/09/2015 out of the KCC does not appear to be tenable. Further, the assessee has not submitted the expense related to agriculture activities, Documentary proof of expense like labour, seeds, pesticide, electricity bills for irrigation purpose. The assessee has not produced any document from PARTWARI regarding the agricultural produce". Under the facts and remand report submitted by the AO, the amount of Rs. 26,98,100/- was correctly added u/s 69A of the Act to which provisions of section 115BBE are squarely applicable. During the appellate proceedings, vide notice dated 27/05/2024 & 20/06/2024 with the attachment of Remand Report dated 24/05/2024, the appellant was given another opportunity to furnish his comments or contentions in the light of the said remand report and by which the appellant was to respond by 25/06/2024 [11:30 A.M.]. The very fact that the appellant did not respond to any of the two notices dated 27/05/2024 & 20/06/2024 by which the appellant was requested to offer his comments or make further submission, leads to the presumption that the appellant is not keen on pursuing his

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appeal. Accordingly, the conclusion arrived at by the Assessing Officer in the Remand Report is treated as correct. Under these circumstances, I conclude that the appellant is not serious to pursue the appeal and therefore the current appeal is dismissed and the action of the AO is confirmed. 10. In the result, the appeal is dismissed. [Emphasis supplied] 6. Ld. AR for assessee carried us to the submissions/documents filed by

assessee to CIT(A) and attempted to convince that the submission/

documents of assessee are self-sufficient to explain the sources of impugned

deposits made in bank a/c and taking into account the same, the addition

made by AO must be deleted.

submission of Ld. AR. He submitted that firstly the AO had to pass ex-parte

assessment-order because the assessee remained non-compliant to all

notices including final show-cause notice issued by AO. He submitted that

the assessee did not provide any detail/document to AO qua the source of

deposits made in bank a/c. Secondly, he submitted that when the AO found

certain infirmities/adverse points in the submission/documents filed by

assessee before CIT(A) and informed those infirmities/adverse points in

Remand-Report and thereafter the CIT(A) afforded opportunity to assessee to

counter the Remand-Report, even at that stage the assessee did not turn up.

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Therefore, in the situation, the assessee/Ld. AR cannot claim before ITAT for

deletion of addition. Ld. DR submitted that in such a situation when the

assessee has not availed the opportunity to counter the Remand-Report filed

by AO, the matter can be re-stored at the level of CIT(A) in the interest of

justice. But since the assessment-order itself is ex-parte u/s 144 and the

adverse remarks made by AO in Remand-Report have to be resolved

ultimately at the level of AO, it would be better to restore this matter to the

file of AO for a proper examination and adjudication. Ld. DR submitted that

he would have no objection if the case is restored at the level of AO.

objection if the case is remanded to the file of AO.

of case, we deem it fit to remand this matter back to the file of AO for

adjudication afresh, at the risk and responsibility of assessee. The AO shall

give necessary opportunity of hearing to assessee and pass an appropriate

order uninfluenced by his earlier order. The assessee is also directed to

ensure participation in the hearings as may be fixed by AO and do not seek

unnecessary adjournments failing which the AO shall be at liberty to pass

appropriate order in accordance with law. Ordered accordingly.

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Order pronounced in open court on 28/04/2025

Sd/- Sd/-

(PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER

Indore िदनांक/Dated : 28/04/2025 Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPYAssistant Registrar Income Tax Appellate Tribunal Indore Bench, Indore

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