BISHNU CHARAN PANDA,PURI vs. INCOME TAX OFFICER, PURI

It was submitted by the ld. AR that the assesee is a cancer patient. It was the submission that the assesee had been unable to file his return of income for the relevant assessment year. It was further submitted that the assesee had also admittedly not represented before the AO on account of his treatment. It was the submission that the AO had estimated the income of the assesee by applying the provisions of Section 44AD of the Act. It was the submission that in earlier and subsequent years net profits were in the range of 1.8 to 2%. It was the prayer that the issues may be restored to the file of AO for readjudication and the assesee would be in a position to provide all the details before the AO. It was also the submission that other additions in the form of cash deposit during the demonetization period has also been disallowed and there has been addition under the head income from other sources.

In reply, ld. Sr. DR submitted that he had no objection if the issues are restored to the file of ld. AO for readjudication.

I have considered the rival submissions. A perusal of the facts and circumstances of the present case shows that the AO has admittedly applied the provisions of Section 44AD of the Act when estimating the income of the assesee. The AO has also for the assessment year 2017- 2018 added the cash deposited during the demonetization period. There has also been certain addition on account of income from other sources. Admittedly, the turnover of the assesee is in excess of Rs.2 crores. Obviously, the provisions of Section 44AD of the Act would not apply. Even when estimating the income of the assesee, the Hon’ble Supreme Court as also the various Hon’ble High Courts have categorically held that the income disclosed by the assesee in earlier and subsequent years is to be considered while estimating the income. This has admittedly not done. It is also noticed that there is failure on the part of the assesee in not representing the case before the AO. This being so, in the interest of justice, I am of the view that the issues involved in both the appeals are restored to the file of ld.AO for readjudication afresh after providing sufficient opportunity of being heard to the assesee.