MYDHEEN KHAN ABITHABEEVI ,NEYYATTINKARA vs. ASSISTANT COMMISSIONER OF INCOME TAX, TRIVANDRUM

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ITA 734/COCH/2023Status: DisposedITAT Cochin14 May 2025AY 2017-2018Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI SOUNDARARAJAN K. (Judicial Member)3 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Income Tax Appellate Tribunal found that the CIT(A) had passed an ex-parte order because the hearing notices were sent to an incorrect email ID, thus depriving the assessee of a reasonable opportunity to present their case. Consequently, the ITAT decided to remand the matter back to the CIT(A) for fresh adjudication on merits.

What were the facts?

The assessee, engaged in cement business, filed an ITR for AY 2017-18. The Assessing Officer completed the assessment by adding Rs. 2,60,70,775/- for cash deposits made in specified bank notes during the demonetization period, rejecting the assessee's claim that these were from business sales. The CIT(A) subsequently confirmed this addition.

What were the issues?

Whether the CIT(A)'s ex-parte order, issued due to notices being sent to an incorrect email address and thus denying the assessee a reasonable opportunity of hearing, should be set aside and the matter remanded for fresh adjudication.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH

Before: SHRI INTURI RAMA RAO, AM & SHRI SOUNDARARAJAN K., JM

For Appellant: Smt. Parvathy Ammal, CA
For Respondent: Smt. Leena Lal, Sr. D.R
Hearing: 12.03.2025Pronounced: 14.05.2025

O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)], dated 11.09.2023 for Assessment Year (AY) 2017-18.

2.

Brief facts of the case are that the appellant is an individual engaged in the business of dealing in cement. The return of income for AY 2017-18 was filed on 20.01.2018 declaring total income of Rs. 21,42,230/-. Against the said return of income, the assessment Mydeheen Khan Abithabeevi was completed by the ACIT, Circle-2(1), Trivandrum (hereinafter called "the AO") vie order dated 30.12.2019 passed u/s. 143(3) of the Income Tax Act, 1961 (the Act) at a total income of Rs. 2,82,13,000/-. While doing so, the AO made addition of Rs. 2,60,70,775/- being the cash deposits made in specified bank notes (SBN) during demonetisation period, rejecting the contention of the appellant that the cash deposits were made out of sale proceeds of the business.

3.

Being aggrieved, an appeal was filed before the CIT(A) who vide the impugned order confirmed the action of the AO by holding that the appellant had failed to substantiate the abnormal increase in cash balance on 09.11.2016 even before the CIT(A), despite granting several opportunities.

4.

Being aggrieved, the appellant is in appeal before us in the present appeal.

5.

The learned counsel for the assessee submitted that the CIT(A) dismissed the appeal exparte without giving reasonable opportunity to the appellant. The appellant could not respond to the hearing notices issued by the CIT(A), since the notices were sent by the CIT(A) on wrong email ID. It is submitted that the matter may be remanded back to the file of the CIT(A) for fresh adjudication on merits in accordance with law.

7.

We have heard the rival contentions and perused the material available on record. The CIT(A) had passed exparte order for non- prosecution. We are satisfied with the reasons stated for non- response before the CIT(A) and, therefore, in order to meet the ends of justice, we are of the considered opinion that the matter requires remand to the file of CIT(A) for fresh adjudication in accordance with law after affording reasonable opportunity of hearing to the appellant.

8.

In the result, appeal of the assessee stands partly allowed.

Order pronounced in the open court on 14th May, 2025.

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