Loading judgment…
Facts
The assessee filed a return for AY 2017-18 declaring income of Rs. 3,39,220. The Assessing Officer (AO) reopened the case for unexplained cash deposits of Rs. 12,00,000 made during the demonetization period. The assessee claimed the cash was from sales and on hand, but could not provide evidence. The AO made the addition under section 69A r.w.s. 115BBE of the Act. The CIT(A) dismissed the assessee's appeal for non-compliance.
Held
The Tribunal noted that the assessee could not pursue the case effectively before the lower authorities due to the death of their tax consultant. The assessee had not raised grounds of appeal before the CIT(A). However, in the interest of justice, the Tribunal set aside the CIT(A)'s order and restored the matter for fresh adjudication.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal without adjudicating on merits, and if the assessee deserves another opportunity to present the case.
Sections Cited
Section 147, Section 148, Section 68, Section 69A, Section 115BBE, Section 250
AI-generated summary — verify with the full judgment below
Before: SHRI PAWAN SINGH & SHRI BIJAYANANDA PRUSETH
आदेश / O R D E R
PER BIJAYANANDA PRUSETH, AM:
This appeal by the assessee emanates from the order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) dated 06.06.2024 by the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘Ld. CIT(A)’] for the Assessment Year (AY) 2017-18.
Grounds of appeal
raised by the assessee are as under: “1. The Ld. AO has erred in reopening of the case u/s 147of the Act and also erred in issuing the notice u/s 148 of the Act and also the Ld.CIT(A) has erred in confirming the same.
2. The Ld. AO has erred in making addition of Rs.12,0,000/- in respect of unexplained cash credits u/s 68 of the Act and also the Ld. CIT(Appeals) has erred in confirming the same.
/AY.2017-18 Abdulla Abdul Shakur Bangali 3. The appellant reserves the right to add, alter, amend or withdraw any grounds of appeal
.”
3. The facts of the case in brief are that assessee filed his return of income for AY.2017-18 on 17.03.2018, declaring total income of Rs.3,39,220/-. On the basis of information that assessee deposited cash of Rs.12,00,000/- in his bank account maintained with HDFC Bank during the demonetization period, the assessee was required to furnish online response of the said cash deposit. In response, the assessee submitted that the cash was out of cash sales and out of cash on hand as on April, 2016. On further query, the assessee could not submit documentary evidence to explain the source of cash deposits. In view of these facts, notice u/s 148 of the Act was issued on 22.06.2021. Subsequently, information was provided to the assessee on 25.05.2022. The assessee failed to reply to the notice and information provided; hence, order u/s 148A(d) of the Act was passed on 29.07.2022 and fresh notice u/s 148 of the Act was issued on 29.07.2022. The assessee was given opportunity of hearing including a show cause notice dated 09.05.2023 proposing addition of unexplained cash deposit on Rs.12,00,000/- during demonetization period. The assessee did not reply to the said notice and hence Rs.12,00,000/- was added u/s 69A r.w.s. 115BBE of the Act.
4. Aggrieved by the order of AO, the assessee filed appeal before CIT(A). The CIT(A) issued notices u/s 250 on 23.01.2024, 10.05.2024, 22.05.2024 and 29.05.2024. The assessee did not make any submission in /AY.2017-18 Abdulla Abdul Shakur Bangali response to the said notice. Hence, the CIT(A) decided the appeal on the basis of materials available on record. The CIT(A) has noted that assessee did not file any grounds of appeal in Form No.
35. He has also not submitted any details during the appellate proceedings; hence, appeal was dismissed.
5. Aggrieved by the order of CIT(A), the assessee filed appeal before the Tribunal. The learned Authorized Representative (ld. AR) of the assessee filed a paper book containing 63 pages including written submissions. In the written submission, it was submitted that the appellant could not pursue his case either before the AO or the CIT(A) because the case was very old and the earlier tax consultant, Late Mr. Surendra Dhorajia died on 20.08.2020. After his death, his office was handled by his wife and the appellant submitted all details to his wife. However, nothing was submitted by her before the CIT(A) and only part reply had been submitted before the AO. The ld. AR submitted that validity of notice u/s 148 of the Act has been contested because escaped income was less than Rs.50,00,000/-.
6. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue supported the order of lower authorities. He submitted that only part details were filed before AO and no details were filed before the CIT(A). The assessee has not even raised any ground of appeal before the CIT(A) and hence, the order of CIT(A) may be upheld.
/AY.2017-18 Abdulla Abdul Shakur Bangali 7. We have heard both the parties and perused the materials available on record. We have also gone through the details filed by the appellant. It is seen from the record that the appellant himself has admitted that he could not pursue the case properly before the AO and CIT(A), mainly due to the death of his old tax consultant, Shri Surendra Dhorajia. Though details were handed over to his wife, she had submitted only part details before AO and nothing before the CIT(A). We find from Form No.35; the appellant has not raised any grounds of appeal before the CIT(A). The CIT(A) issued 4 notices to the appellant and in absence of any response, he passed the order on the basis of materials available on record. Since, no grounds were raised, he had dismissed the appeal of the assessee. We do not find any infirmity in the order of the CIT(A). The order of CIT(A) in disposing the appeal shall be in writing, shall state the points for determination, the decision thereon and reasons for the decision. In absence of grounds of appeal, there was no point for decision by the CIT(A). Hence, the CIT(A) has rightly passed the order dismissing the appeal. However, considering the facts that the regular tax consultant had died during the assessment proceedings and his wife could not pursue the matter effectively before appellate authority, the assessee deserves one more opportunity to plead his case on merits including the jurisdictional issue before the CIT(A). Therefore, in the interests of justice, we set aside the order of CIT(A) and restore the matter /AY.2017-18 Abdulla Abdul Shakur Bangali back to the file of CIT(A) for fresh adjudication after affording adequate and reasonable opportunity of hearing to the assessee.
8. In the result, appeal of the assessee is allowed for statistical purpose. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 28/05/2025.