KORADA RAJU,VIZIANAGARAM vs. INCOME TAX OFFICER,WARD-2, VIZIANAGARM

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ITA 438/VIZ/2025Status: DisposedITAT Visakhapatnam26 November 2025AY 2017-187 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay of 381 days in filing the appeal, finding that the assessee was prevented by a reasonable and sufficient cause. On the merits, the Tribunal acknowledged that the assessee had not complied with the notices issued by the revenue authorities. However, considering the prayer of the assessee's AR and in the interest of justice, the Tribunal decided to remit the matter back to the file of the CIT(A). The CIT(A) was directed to consider the appeal afresh and decide the case on merits by providing one final opportunity to the assessee to be heard. The Tribunal cautioned that if the assessee failed to cooperate with the remand proceedings, the CIT(A) would be at liberty to decide the case based on the material available on record. The grounds raised by the assessee were allowed for statistical purposes. The specific issue of the AO's justification for the addition under section 69A was not decided on merits by the Tribunal but was to be considered by the CIT(A) upon remand.

What were the facts?

The assessee, Korada Raju, an individual, filed an appeal before the ITAT against the order of the CIT(A) for Assessment Year 2017-18. The appeal was filed with a delay of 381 days. The assessee's return of income for AY 2017-18 admitted a total income of Rs. 3,10,020. The Assessing Officer (AO) initiated assessment proceedings under section 143(3) due to cash deposits in the assessee's bank account during the demonetization period, totaling Rs. 16,94,121 in a Canara Bank account. The AO made an addition of this amount as unexplained cash deposits. The CIT(A) upheld the AO's order ex-parte as the assessee did not respond to notices. The assessee attributed the delay and lack of response to the actions of their Chartered Accountant.

What were the issues?

1. Whether the delay of 381 days in filing the appeal before the Tribunal should be condoned, considering the reasons explained by the assessee (question of fact). 2. Whether the CIT(A) was justified in dismissing the appeal ex-parte and not providing sufficient opportunities to the assessee (question of law and fact). 3. Whether the Assessing Officer was justified in making an addition of Rs. 16,94,121 under section 69A of the Income Tax Act, 1961, towards alleged unexplained cash deposits (question of law). Assessee's Contention: The assessee argued that the delay was due to reasons beyond their control, including being uneducated, a senior citizen, and the negligence of their Chartered Accountant in handling communications. The assessee contended that the CIT(A) passed the order without providing sufficient opportunities and prayed for one final opportunity before the CIT(A) to submit relevant documents. The assessee also argued that the AO was not justified in making the addition under section 69A. Revenue's Contention: The revenue strongly objected to the assessee's plea, arguing that ample opportunities were provided to the assessee by the revenue authorities, but the assessee failed to comply with the notices. The revenue pleaded that no further opportunity should be granted and prayed for upholding the order of the CIT(A).

Which sections of the Income-tax Act were involved?

Section 143(3),Section 69A,Section 133(6),Section 142(1),Section 143(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM

Before: SHRI RAVISH SOOD, HON’BLE

For Appellant: Shri GVN Hari, Advocate
For Respondent: Dr. Aparna Villuri, Sr.AR

आदेश /O R D E R

PER SHRI S. BALAKRISHNAN, ACCOUNTANT MEMBER:

1.

This appeal is filed by the assessee against order of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No.

I.T.A.No.438/VIZ/2025 Korada Raju ITBA/NFAC/S/250/2024-25/1064156843(1) dated 17.04.2024 for the A.Y.2017-18 arising out of the order passed under section 143(3) of Income Tax Act, 1961 (in short ‘Act’) dated 28.12.2019.

2. At the outset, it is noticed from the appeal record that there is a delay of 381 days in filing the appeal before the Tribunal. Explaining the reasons for belated filing of the appeal, the Ld. AR drew our attention to the affidavit filed by the assessee along with a petition seeking for condonation of delay and read out the contents of the petition which is as under: - “1. The order of the learned Commissioner of Income Tax (Appeals) in the case of the appellant was passed on 17.02.2024. As such, the appeal against this order ought to have been filed on or before 16.06.2024. However, the appeal could be filed only on 16.07.2025 resulting in a delay of 381 days in filing the appeal.

2. The appellant is a house wife and uneducated. Moreover, she is a senior citizen. Her husband is also uneducated and is doing petty jobs for their livelihood. During the financial year 2016-17, the appellant and her husband started a small business of welding and rod bending. The appellant filed the return of income for A.Y.2017-18 admitting total income of Rs.3,10,020. However, the business was stopped during the same financial year. As the appellant is uneducated, the Chartered Accountant gave his email account viz'ramskvzm@gmail.com' at the time of filing the return of income of appellant for A.Y.2017-18. This was the first and also the last return filed by appellant. The appellant did not have any income and is completely dependent upon her husband.

3. Assessment proceedings in the case of the appellant were initiated on the ground that there were cash deposits in the bank account of the appellant during the demonetization period. All the hearing notices were sent to the above said email account given in the return of income. The Chartered Accountant filed response to one of the notices seeking adjournment. However, he could not get the requisite information from the appellant and hence due to lack of necessary information did not respond to the notices issued subsequently. The assessing officer passed the assessment order on 28.12.2019 u/s 143(3) of the Act by making addition of Rs.16,94,121 towards unexplained cash deposits. The assessment order was also sent to the same email account. With the help of the Chartered Accountant, the appellant filed appeal against the assessment order on Page No. 2 I.T.A.No.438/VIZ/2025 Korada Raju 06.02.2020. The appellant requested the Chartered Accountant to give his email account in the appeal papers. The Chartered Accountant filed the appeal and gave his email account. However, e option in Form 35 for not sending any communication to the email account was selected 4. The Chartered Accountant, whose email address was given in Form no.35, has a very large client base and his email account is flooded with so many mails received during the course of his profession. This is the specific reason as to why the option to receive the notice by email was not selected in Form no.35. However, he happened to see one notice dated 07.04.2022 sent by the learned Commissioner of Income Tax (Appeals) and sought adjournment in response to the said notice. The remaining notices skipped his attention and as such the learned Commissioner of Income Tax (Appeals) passed the order exparte on 17.04.2024. This was also not seen by the Chartered Accountant.

5. While it is so, the appellant received a phone call in the second week of July, 2025 from the income tax officer regarding the payment of tax dues. At this point of time, the appellant visited the office of the Chartered Accountant and came to know about the order of the learned Commissioner of Income Tax (Appeals). Immediately, the appellant took necessary steps and filed further appeal before the hon'ble ITAT on 16.07.2025.

6.

Thus, the delay in filing the appeal was due to the reasons explained above which were beyond the control of the appellant. The delay is neither intentional nor deliberate. Therefore, the appellant prays the hon'ble ITAT to condone the said delay of 381 days in filing the appeal and pass appropriate orders in the interest of rendering substantial justice.”

3.

On perusal of the contents of the affidavit filed by the assessee as well as the submission of the Ld. AR, we find that the assessee is prevented by a reasonable and sufficient cause in filing the appeal beyond the prescribed time limit with a delay of 381 days. Therefore, we hereby condone the delay of 381 days in filing the appeal before the Tribunal and proceed to adjudicate the appeal on merits in the following paragraphs.

4.

Brief facts of the case are that, assessee being an individual filed his return of income on 31.03.2018 admitting a total income of Rs.3,10,020/-. The Page No. 3

I.T.A.No.438/VIZ/2025 Korada Raju case was selected for complete scrutiny through CASS to verify “Cash deposit during demonetization period”. Accordingly, notice under section 143(2) of the Act dated 22.09.2018 was issued. As per the AIR information available in ITBA portal, assessee has made cash deposits in his bank accounts during demonetization period. Notice under section 133(6) was issued to the bank and in response banks has submitted the details as called for by the Ld. AO. Ld. AO noticed that Ld. AO has made cash deposits as follows:

Name & Address of Cash Sl.No. Bank A/c. No. the Bank Deposited 1. Canara Bank 31197660000006 16,94,121/- Chintavalasa Vizianagaram

5.

Thereafter, Ld. AO issued various notices under section 142(1) of the Act requiring the assessee to submit the details and evidences required for the purpose of verification and examination of issue involved in the assessment proceedings. In response, assessee failed to furnish any explanation about the nature and source of cash deposits and not responded to the notices. Thereafter, Ld. AO proceeded to complete the assessment under section 143(3) of the Act based on the material available on record and information gathered from the bank and determined the income of the assessee at Rs.20,04,141/- by making addition of cash deposits of Rs.16,94,121/- as unexplained money under section 69A of the Act.

Page No. 4

I.T.A.No.438/VIZ/2025 Korada Raju 6. On being aggrieved by the addition made by the Ld. AO, assessee filed an appeal before Ld. CIT(A). Ld. CIT(A) upheld the order of the Ld. AO since assessee has not responded to any of the notice / opportunities provided to the assessee.

7.

On being aggrieved by the order of the Ld. CIT(A), assessee is in appeal before us by raising following grounds of appeal: -

1. The order of the learned Commissioner of Income Tax Appeals) is contrary to the facts and also the law applicable to the facts of the case.

2.

The learned Commissioner of Income Tax Appeals) is not justified in dismissing the appeal ex-parte.

3. The learned Commissioner of Income Tax (Appeals) ought to have held that the assessing officer is not justified in making addition of Rs.16,94,121 u/s 69A of the Act towards alleged unexplained.

4. Any other grounds may be urged at the time of hearing.”

8.

At the outset, Ld. Authorised Representative [hereinafter “Ld.AR”] submitted that the Ld. CIT(A) has passed the order without providing sufficient opportunities to the assessee. He further pleaded that the assessee could not respond to the notices issued by the Ld. CIT(A). He therefore prayed for one final opportunity before Ld. CIT(A) to submit the relevant documents.

9.

Per contra, Ld. Departmental Representative [hereinafter in short “Ld.DR”] strongly objected to theplea of the Ld.AR and vehemently argued that revenue has provided ample opportunities to the assessee as detailed in their respective orders. However, assessee has failed to comply with the notices

Page No. 5

I.T.A.No.438/VIZ/2025 Korada Raju issued by the Revenue Authorities. She therefore pleaded that the no further opportunity should be granted and prayed for upholding the order of the Ld.CIT(A).

10.

We have heard rival contentions and perused the material available on record. It is an undisputed fact that the assessee has not complied with the notices and has also not responded to the various notices issued to the assessee as detailed in the order of the Ld. CIT(A). Considering the facts and circumstances of the case, as well as the prayer of the Ld. AR and in the interest of justice, we hereby remit the matter back to the file of Ld. CIT (A) in order to consider the appeal afresh and decide the case on merits by providing one final opportunity to the assessee of being heard. Needless to say, that the assessee should cooperate with the remand proceedings failing which the Ld. CIT(A) is at liberty to decide the case based on the material available on record. Accordingly, the grounds raised by the assessee are statistically allowed.

11.

In the result, appeal filed by the assessee is allowed for statistical purposes.

Order pronounced in the open court on 26th November, 2025.

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