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Facts
The assessee was non-compliant during assessment proceedings, leading the Assessing Officer to make an ex-parte assessment under Section 144 of the I.T. Act. The CIT(A) also dismissed the assessee's appeal ex-parte due to lack of response to statutory notices. The assessee claims inability to appear due to circumstances beyond control.
Held
The Tribunal, while acknowledging the assessee's non-compliance and the ex-parte nature of the orders, felt that principles of natural justice required an opportunity to be heard. The order of the CIT(A) was set aside, and the matter was remitted back to the Assessing Officer for adjudication on merits.
Key Issues
Whether the ex-parte orders passed by the lower authorities denying the assessee an opportunity to be heard on merits were justified, and if the matter should be remitted back for fresh adjudication.
Sections Cited
271(1)(b), 144, 69A, 271(1)(c)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: SHRI V. DURGA RAO & SHRI K.M. ROY, ACCOUNTANT, MEMBER
Date of Hearing – 29/01/2025 Date of Order – 30/01/2025
O R D E R PER V. DURGA RAO, J.M.
The captioned appeal by the assessee is emanating from the impugned order dated 27/02/2024, passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“learned CIT(A)”], for the assessment year 2013-14.
During the course of proceedings before us, we find that the assessee was non-compliant during the assessment proceedings and the Assessing Officer dismissed the assessee’s case by observing as under:-
“7. After issuing above mentioned notices assessee did not complied till date Penalty proceedings u/s 271(1)(b) of the I. T. Act, are initiated. As per information the assessee has deposited Rs. 89,64,612/- with M/s Reunuka Mata Multi State Co-op. Credit Society during the F.Y. 2012-13 source of 2 Amarlal Thavardas Panjwani ITA no.262/Nag./2024 which has not been explained even after providing ample opportunities. As such I have no other option to make assessment as per provisions of section 144 of the I. T. Act.
Since assessee has not disclosed sources of money during F.Y. 2012-13 and did not submitted any explanation regarding source of this money. Therefore, it is evident that assessee has deposited the cash trough his un- explained sources of income to the tune of Rs. 89,64,612/-. Therefore, an addition of Rs. 89,64,612/- is made to the total income of the assessee as unexplained money u/s 69A of the I. T. Act. Penalty Proceeding u/s 271(1)(c) is hereby initiated. Total income is assessed as under-
3. On appeal, during the first appellate proceedings, due to assessee’s lackadaisical approach, the assessee did not respond to the multiple statutory notices issued the assessee and hence the learned CIT(A) dismissed the assessee’s appeal by issuing ex-parte order without dealing the issues on merit.
4. Before us, the learned Counsel for the assessee, Shri Kishore P. Dewani, prayed that the matter be restored to the file of the Assessing Officer to enable the assessee to argue the matter on merits. He submitted that the assessee could not appear before the Assessing Officer due to situation beyond the control of the assessee.
2. On the other hand, the learned D.R. submitted that despite the learned CIT(A) and the Assessing Officer provided sufficient opportunities to the assessee, however, the assessee did not comply to the statutory notices issued by both the authorities below and failed to furnish relevant details. He strongly supported the order passed by the authorities below.
We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. We find that though
3 Amarlal Thavardas Panjwani ITA no.262/Nag./2024 the learned CIT(A) as well as the Assessing Officer granted opportunities to the assessee to substantiate its case, ultimately, the order passed by the authorities below are ex-parte orders by dismissing the appeal without going onto the merits of the case. Therefore, we are of the opinion that by following the principles of natural justice, one opportunity should be given to the assessee to substantiate the case before the Assessing Officer. In view of the above, the order passed by the learned CIT(A) is set aside and remit back the matter to the file of the Assessing Officer and direct him to adjudicate the matter afresh on merit and in accordance with law after providing reasonable opportunity of being heard to the assessee. It is also directed that the assessee should not seek adjournment without there being a justified reason. Accordingly, all the grounds raised by the assessee in this appeal are allowed for statistical purposes.
In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 30/01/2025