ARIMBOOTH JAYAPRAKASH,MALAPPURAM vs. ASSISTANT COMMISSIONER OF INCOME TAX, TIRUR
Facts
The assessee, a proprietor in aluminum fabrication, incurred significant losses in AY 2011-12. The AO made an assessment under section 144 based on cash deposits treated as unexplained income. The assessee appealed to the CIT(A), who dismissed it for not filing grounds of appeal. The assessee then appealed to the Tribunal.
Held
The Tribunal acknowledged that the assessee's consultant failed to file proper grounds of appeal and that the CIT(A) dismissed the appeal on technical grounds without deciding the merits. The Tribunal also considered that the mistake was made by the consultant, not the assessee.
Key Issues
Whether the assessee should be penalized for the consultant's error in filing grounds of appeal, and if the appeal should be decided on merits.
Sections Cited
144
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH : COCHIN
Before: SHRI INTURI RAMA RAO & SHRI SOUNDARARAJAN K.
PER SOUNDARARAJAN K., JUDICIAL MEMBER
This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 27/01/2025 in respect of the A.Y. 2011-12.
The assessee is a proprietor engaged in the business of aluminium fabrication works on contract basis. During the A.Y. 2011-12, the assessee incurred huge losses and the AO had made an assessment u/s. 144 of the Act. The AO made the assessment on the allegation that the assessee had cash deposits in Vijaya Bank and IDBI Bank which was treated as
Page 2 of 4 ITA No. 472/Coch/2025 unexplained income. The assessee challenged the said order before the Ld.CIT(A). The Ld.CIT(A) had dismissed the appeal on the ground that the assessee had not filed any grounds challenging the order of the assessment.
As against the said order, the assessee is in appeal before this Tribunal.
At the time of hearing, the Ld.AR submitted that the assessee is having all the documents to show that the cash deposits could not be treated as unexplained income but unfortunately, because of the heavy losses incurred by the assessee, he was not able to concentrate on business and therefore the details could not be filed before the AO. The Ld.AR further submitted that the authorised representative who have filed the appeal had omitted to file the grounds of appeal and therefore prayed that another opportunity to file the grounds may be granted and thereafter decide the appeal on merits. The Ld.AR further submitted that even though the assessee had not submitted the grounds, he has submitted written submissions along with the relevant documentary evidences and therefore submitted that the Ld.CIT(A) had dismissed the appeal on technical grounds without deciding the issue on merits.
The Ld.DR relied on the orders of the lower authorities.
We have heard the arguments of both sides and perused the materials available on record.
From the facts available on record, we came to know that the assessee had filed the appeal in time before the Ld.CIT(A) but unfortunately the consultant who had filed the appeal had not filed any elaborate grounds but submitted that the assessee had not concealed any income and also submitted that the grounds of appeal with evidences already furnished before the officer shall be furnished at the time of hearing. Subsequently before the Ld.CIT(A), the assessee filed his written submissions and also
Page 3 of 4 ITA No. 472/Coch/2025 some documents to show that there is no suppression of any income. The Ld.CIT(A) after extracting the said submissions and also the grounds filed by the assessee, had finally observed that the assessee had not filed any grounds of appeal for adjudication even though numerous opportunities have been given to the appellant for rectifying the said deficiency.
We have also considered the submission that the mistake has been committed by the tax consultant and therefore on the said ground, the assessee should not be penalised.
Considering the facts and circumstances of the case, we are of the view that the assessee should be granted another opportunity to appear before the Ld.CIT(A) with the detailed grounds of appeal and in such circumstances, the Ld.CIT(A) is directed to decide the appeal on merits and in accordance with law after hearing the assessee.
In the result, the appeal filed by the assessee is partly allowed.
Order pronounced in the open court on 26th August, 2025.
Sd/- Sd/- (INTURI RAMA RAO) (SOUNDARARAJAN K.) Accountant Member Judicial Member
Cochin, Dated, the 26th August, 2025 /MS /
Page 4 of 4 ITA No. 472/Coch/2025 Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Cochin 5. Guard file 6. CIT(A)
By order
Assistant Registrar, ITAT, Cochin
