VINEET KUMAR,DHARAMSHALA vs. INCOME TAX OFFICER, DHARMSHALA

The Ld. CIT(A) upheld the action of the Assessing Officer by observing that the assessee had failed to properly comply with the notices issued during the assessment proceedings and no satisfactory explanation with evidences was furnished to substantiate the source of cash deposits.

Aggrieved, the assessee has raised multiple grounds of appeal, primarily challenging the validity of reassessment proceedings, invocation of section 144, violation of principles of natural justice, and also the addition made under section 69A of the Act. The grounds, inter alia, include challenge to juri iction on account of alleged invalid issuance of notice under section 148, non-compliance of procedure prescribed under section 148A, improper invocation of best judgment assessment despite compliance, and failure of the authorities below to consider replies and evidences furnished by the assessee.

None appeared at the time of hearing of appeal.

Per contra, the Ld. Departmental Representative relied upon the orders of the lower authorities and submitted that sufficient opportunities were granted to the assessee, however, the assessee failed to furnish cogent evidences to explain the cash deposits and therefore the Assessing Officer was justified in invoking section 144 and making addition under section 69A of the Act.

I have heard the submissions of DR and perused the material available on record. The primary issue that arises for consideration is whether the assessment framed under section 144 read with section 147 of the Act is sustainable in law and on facts.

On perusal of the record, it is observed that the Assessing Officer has proceeded to complete the assessment under section 144 of the Act on the premise that the assessee failed to comply with the notices issued under section 142(1). However, from the material placed on record and as also noted in the grounds of appeal, it emerges that the assessee had filed replies during the course of assessment proceedings. The assessment order itself records that certain replies were filed, though the same were not supported by documentary evidences. In such circumstances, the invocation of section 144 without duly considering the replies and without confronting

Further, it is also evident that the Ld. CIT(A) has dismissed the appeal without properly adjudicating upon the contentions raised by the assessee and without passing a speaking order as mandated under section 250(6) of the Act. The Ld. CIT(A) has failed to frame proper points for determination and has not dealt with the submissions and evidences in a reasoned manner, thereby rendering the appellate order non-speaking and unsustainable in law.

Considering the entirety of facts and circumstances of the case, I am of the considered view that the matter requires fresh examination at the level of the Assessing Officer. The assessee should be afforded one more effective opportunity to substantiate his claim with necessary evidences in respect of the cash deposits.

Accordingly, in the interest of justice, the impugned order passed by the Ld. CIT(A) is set aside and the matter is restored to the file of the Assessing Officer for fresh adjudication in accordance with law. The Assessing Officer shall provide adequate opportunity of being heard to the assessee and shall pass a speaking order after duly considering the submissions and evidences to be furnished by the assessee.

The assessee is also directed to cooperate in the set-aside proceedings and furnish all necessary details and evidences as may be called for by the Assessing Officer, failing which the Assessing Officer shall be at liberty to decide the matter in accordance with law.

In the result, the appeal of the assessee is allowed for statistical purposes.