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Facts
The assessee, a Primary Agriculture Co-Operative Society, failed to file its income tax return and respond to notices. The AO made an addition of Rs. 15,45,000 on account of unverified cash deposits during demonetization. The CIT(A) upheld the AO's order after the assessee failed to appear or respond to notices.
Held
The Tribunal acknowledged that the assessee, a society providing benefits to farmers and laborers, had not been properly informed of hearing dates and had faced challenges due to incorrect contact information. Therefore, the delay in filing the appeal was condoned, and the case was remanded to the AO for a fresh assessment with an opportunity for the assessee to be heard.
Key Issues
Whether the delay in filing the appeal should be condoned and whether the case should be remanded for a fresh assessment after the assessee was prevented from presenting their case effectively.
Sections Cited
Sec. 250 of the Income Tax Act, 1961, Sec. 144 of the Income Tax Act, 1961, Sec. 142(1) of the Income Tax Act, 1961, Sec. 80-P of Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “PATNA BENCH”, PATNA
Appearances by: Assessee represented by : None Department represented by : Ashwani Kumar, Sr. DR Date of concluding the hearing : 08.01.2025 Date of pronouncing the order : 14.01.2025 O R D E R
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
In this case, there is a delay of 396 days which has been requested to be condoned through a petition as under:
“Most Respectfully sheweth, The applicant is a Prathmik Krishi Sakh Society Limited. Its activity is providing benefits to farmers and labors who is the member of society in providing small loan and taking deposits as well as sale of food grain, Fertilizers and Kerosene Oil to poorer having ration card holder under PDS shop controlled by the state government. The applicant filed appeal before the CIT (A) NFAC on 03.12.2019 The date of hearing fixed by the CIT (A) NFAC on 05.01.2021, 05.08.2022, 09.11.2022 and 18.01.2023.
Dhrubgama Prathmik Krishi Sakh Society Limited The applicant could not know the date of hearing as it was provided on e-mail and mob no. The mail id and Mob No. mentioned in application form -35 and in IT portal does not belongs to any member or chairman of the society. The mail id and Mob No. given in e-filing portal and in form -35 is Unidentical and seems that it was the any staff member of our then tax consultant. The chairman of the society Shri Aditya Kumar visit the local I.T office on 06.02.2024 to know the status of the case then he come to know that the Order U/s -250 of the Act has already been passed on 30.01.2023. Under the above facts the petitioner is filing this petition for condonation of delay in filing Appeal before ITAT in Form-36 provided the assessee is prevented by reasonable cause. Since the petitioner is prevented by sufficient and reasonable cause in not filing Appeal before the ITAT due to absence of knowing about the date of hearing and an order of CIT (A) NFAC, the delay of filing appeal before the ITAT may kindly be condoned. And for this the petitioner is ever pray.” 1.2 Considering the reasons advanced the delay is hereby condoned and the appeal is admitted for adjudication.
The present appeal emanates from order u/s 250 of the Income Tax Act, 1961 (hereafter ‘the Act’) dated 30.01.2023, passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi. In this case the Ld AO passed an exparte order after adding Rs. 15,45,000 on account of allegedly unverified cash deposited during demonetization period.
2.1 Aggrieved with the action of Ld. CIT(A), the assessee has filed the present appeal with the following grounds of appeal:
“1. For that the Ld. CIT(A) NFAC has erred in Upholding Order Passed by A.O. assessed total income of Rs. 15,45,000/- and dismissing the appeal.
2. For that Order passed by CIT(A) NFAC is bad in fact and law of the case and is fit to be annulled.
3. For that the CIT(A) NFAC has not given proper opportunity to explain.
4. For that other grounds, if any, shall be urged at the time of hearing.” 2.2 In this case, the AO is seen to have passed an order u/s 144 of the Act. The Ld. AO has recorded, in his order dated 30.09.2019 that the Dhrubgama Prathmik Krishi Sakh Society Limited assessee had not filed his return of income for the year under consideration and thus notice u/s 142(1) of the Act were issued on 06.08.2019 for submitting certain details. It is further recorded that the assessee did not make any compliance whatsoever and therefore, an addition of Rs. 15,45,000/- was made on account of cash deposited during the demonetization period.
2.3 Before the CIT(A) also, the assessee could not succeed as it is recorded on page 5 para 5.1.1 of the impugned order that the assessee did not respond to any of the notices issued on as many as 4 occasions for presenting his case. Thereby the Ld. CIT(A) was constrained to uphold the action of Ld. AO.
On the last date of hearing, none attended but it was considered appropriate to dispose of this case with the help of Ld. DR. The Ld. DR pointed out that the authorities below did not have any option but to take an adverse view considering that not only had the assessee filed any return of income but he had also not responded to the notices asking for details to be submitted.
3.1 We have perused the orders of the authorities below and have also gone through the statement of facts filed by the assessee. The contents of the statement of facts are as under:
“The appellant is a Primary Agriculture Co-Operative Society (PACKS) which is run for the benefit of its member which is generally farmers and labours. The Society is governed by its member and run under the control of Government of Bihar. The appellant activity is to take deposit and give loan to its members and sale of food grain, fertilizers and kerosene Oil to Ration Card holder which is issued by state government to poorer under PDS Shop. The amount deposited during demonetization period in society bank a/c with Central Bank of India A/c No.2365981051 and Bank of india A/c No. 57810110009683 amounting to Rs. 761000/- and Rs. 784000/- respectively is out of deposit made by its members and sale proceeds of goods under PDS shop. The appellant maintain Books of Accounts which is required to maintain by the society and audited its accounts by a registered chartered accountant under societies Act. The Net Income loss for the year under consideration is Rs. (273992.00) and is exempt U/s 80-P of Income Tax Act, 1961. The deposit made in said bank account is routed through Dhrubgama Prathmik Krishi Sakh Society Limited 3.2 It is felt that the assessee deserves a chance to present the facts before the authorities below in as much as the statement of facts appended to the form of appeal contains relevant information for enabling us to be persuaded for remanding this case back to the file of Ld. AO. Considering the totality of facts and circumstances this matter is remanded to the file of Ld. AO for a fresh assessment after giving an opportunity of being heard. It would be expected that the assessee would avail of the opportunity to present his case adequately before the Ld. AO.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the court on 14.01.2025