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Facts
The assessee, engaged in the business of cattle feed, failed to file an income tax return for AY 2017-18 despite depositing Rs. 19,79,000/- in their bank account during the demonetization period. The Assessing Officer initiated ex-parte assessment proceedings and made an addition of Rs. 19,79,000/- to the assessee's total income.
Held
The Tribunal held that the CIT(A) had not properly considered the documents filed by the assessee and had dismissed the appeal solely on the ground of advance tax payment, without entering into the merits of the case. Therefore, in the interest of natural justice, the assessee was granted an opportunity to submit necessary documents.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal on technical grounds without considering the merits, and whether the assessee should be granted an opportunity to present documents to substantiate their claim.
Sections Cited
139(1), 142(1), 144, 250, 249(4)(b), 208
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “PATNA BENCH, PATNA
Before: Shri Sonjoy Sarma & Shri Rakesh Mishra
Assessment Year: 2017-18 Chanda Devi……………………….....…..…………………....Appellant C/o Hemant Kumar Gupta, Kalyanpur, Samastipur, Bihar-848302. [PAN: BUOPD4526K] vs. ITO, Ward-3(3), Samastipur..….…….…............................…..…..... Respondent Appearances by: Shri Abhi Sarkar, AR, appeared on behalf of the appellant. Shri Ashwani Kumar, Sr. DR, appeared on behalf of the Respondent. Date of concluding the hearing : January 27, 2025 Date of pronouncing the order : January 28, 2025 आदेश / ORDER
Per Sonjoy Sarma, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 30.01.2024 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’).
Brief facts of the case are that the assessee is an individual and engaged in business of cattle feed. The Assessing Officer noticed during the assessment proceedings that the assessee deposited Rs.1979000/- in his bank account during demonetization period and the assessee did not file return of income for the assessment year 2017-18 within due date prescribed u/s 139(1) of the Act. Accordingly, the Assessing Officer issued notice u/s 142(1) of the Act requesting the assessee to file return. However, the assessee failed to comply with the notice as such Assessment Year: 2017-18 Chanda Devi assessment proceedings u/s 144 of the Act were initiated. As the assessee did not able to turn up before the Assessing Officer during the assessment proceedings and failed to produce documents/evidences of cash deposits in his bank account, the Assessing Officer based on the material available with him made an addition of Rs.1979000/- to the assessee’s total income by passing an ex parte assessment order dated 30.09.2019.
Dissatisfied, the assessee preferred appeal before the ld. CIT(A). However, the ld. CIT(A) dismissed the appeal of the assessee by observing that as per section 249(4)(b) of the Act where no return has been filed by the assessee, the assessee was liable to pay an amount equal to the amount of advance tax. He also stated that the assessee did not file an application u/s 208 of the Act which prescribed conditions of payment of advance tax. Accordingly, the ld. CIT(A) dismissed the appeal of the assessee on technical ground without going into merits of the case.
Aggrieved by the said order, the assessee filed the present appeal before this Tribunal. At the time of hearing, the ld. AR stated that the assessment was made ex parte due to non-compliance of the notices and the assessee was unable to present his case before the lower authorities. He argued that the addition of Rs.1979000/- was contrary to the provisions of law and there was no actual tax liability as determined by the Assessing Officer. He also claimed that the assessee had no advance tax liability as alleged by the ld. CIT(A) in his order. He prayed before us that one more opportunity may be given to decide the issue on merits after producing supporting documents in support of his claim.
On the other hand, the ld. DR supported the decisions of the authorities below.
Assessment Year: 2017-18 Chanda Devi 6. We, after considering the rival submissions and reviewing the documents available on record, find that the ld. CIT(A) has not properly considered the documents filed by the assessee and dismissed the appeal of the assessee solely on the ground of payment of advance tax without entering into merits of the case. We, therefore, in the interest of natural justice and fair play, deem it necessary to provide the assessee with an opportunity to submit the required or relevant documents to substantiate his claim before the ld. CIT(A). Accordingly, we remand the issue to the file of the ld. CIT(A) for fresh adjudication. The assessee is directed to file necessary application before the ld. CIT(A) in order to explain reasons for non-payment of advance tax if it is necessary. The ld. CIT(A) is also directed to re-examine the submissions and documents of the assessee and pass a fresh order in accordance with law.
In terms of the above, the appeal of the assessee is allowed for statistical purposes.
Kolkata, the 28th January, 2025.