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Facts
The assessee did not file an Income-tax Return for A.Y. 2013-14, leading to reassessment proceedings initiated based on detected financial transactions totaling Rs. 1.57 crore, including credit card payments and cash deposits. Despite multiple notices from the AO and CIT(A), the assessee failed to comply, claiming to be out of India and not intimated by his accountant. The AO made additions which were subsequently confirmed by the CIT(A).
Held
The Tribunal acknowledged the assessee's repeated failure to assist the authorities in assessment and appellate proceedings. However, considering the assessee's explanation of being out of India and not being intimated, the Tribunal, in the interest of justice, restored the matter to the file of the Assessing Officer for a fresh decision in accordance with the law.
Key Issues
The key issues were the validity of reassessment proceedings under sections 147-151 and the confirmation of additions by the CIT(A) under sections 69C (credit card payments) and 69A (bank deposits), in light of the assessee's non-compliance due to alleged lack of intimation while abroad.
Sections Cited
147, 144, 144B, 288A, 151, 148, 142(1), 69C, 115BBE, 69A, 194A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘F’ NEW DELHI
(Assessment Year : 2013-14) Vinay Aggarwal Vs. ITO Kothi No.2145, Urban Urban Estate, Jind Estate, Jind, Haryana-02 Haryana-126 102 PAN : AAZPA 7517 R (Appellant) (Respondent) Assessee by Shri Sudhir Sahgal, Adv. Respondent by Ms. Harpreet Kaur Hansra, Sr. D.R. Date of Hearing 18.12.2024 Date of Pronouncement 18.12.2024 O R D E R PER VIMAL KUMAR, JM:
1. The appeal filed by assessee is against the order dated 09.10.2023 of Learned Commissioner of Income Tax (Appeals)- National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘Ld. CIT(A)’] arising out of assessment order dated 29.03.2022 by the NFAC, Delhi (hereinafter referred as ‘Ld. AO’) under section 147 r.w.s 144 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] for the Assessment Year 2013-14.
Vinay Aggarwal vs. ITO A.Y. 2013-14 2. Brief facts of case are that assessee did not file Income-tax Return for the year 2013-14. Assessment proceedings under section 147 of the Act were initiated by recording following reasons : “The information from NMS of AIMS module of ITBA, the assessee has entered into the following financial transactions: Sl. Financial Transaction Amount (Rs.) No.
Paid Rs.2,00,000 or more against Rs.6,04,352/- credit card bills 2. Deposit in Cash aggregating Rs.60,00,000/- Rs.2,00,000/- or more, with the banking company (in HDFC Bank, Jind Branch) 3. TDS Return – other interest (Section Rs.31,26,071/- 194A) 4. Deposited cash Rs.10,00,000/- or Rs.60,00,000/- more a saving bank account (Standard Chartered Bank, Delhi Branch) Total Rs.1,57,30,423/-
Approval from authorities under section 151 of the Act was obtained for issuance of notice under section 148 of the Act. Notice under section 148 of the Act dated 31.03.2021 was issued. Notice under section 142(1) dated 23.06.2021 was issued by the ITO, Ward-1, Jind. The assessee did not file return of income in response to notice under section 148 of the Act. Subsequently, the case was assigned to Faceless Assessment Unit under Faceless Assessment Scheme, 2019. In response to the notice, no reply was filed by the assessee. Notice under section 142(1) dated 21.02.2022 along with questionnaire was served on assessee. Assessee filed reply dated Vinay Aggarwal vs. ITO A.Y. 2013-14 26.02.2022 and requested for adjournment till 14.03.2022. Hearing letter dated 04.03.2022 was issued and one more opportunity for filing reply/submission on or before 11.03.2022 was issued. The assessee failed to comply with the notice. On completion of assessment proceedings, learned AO vide order dated 29.03.2022 made additions of Rs.6,04,352/-, Rs.1,20,00,000/- and Rs.31,26,071/- (total assessed income of Rs. 1,57,30,420/- under section 147 r.w.s 144 r.w.s 144B of the Act [Round off under section 288A of the Act)].
Appellant/assessee preferred appeal before the learned CIT(A). Despite several notices, appellant/assessee failed to file return submissions and learned CIT(A) dismissed the appeal vide order dated 09.10.2023.
Being aggrieved, appellant/assessee preferred present appeal.
Learned Authorized Representative for the assessee/appellant submitted that learned CIT(A) erred in confirming the order of learned AO regarding initiation of the assessment proceedings without complying with the provision of section 147 to section 151 of the Act. Learned CIT(A) erred in not considering the fact that an addition of Rs.6,04,352/- under section 69C r.w.s 115BBE of the Act on account of payments made through credit cards. The learned CIT(A) erred in confirming the addition of Rs.1,20,00,000/- under Vinay Aggarwal vs. ITO A.Y. 2013-14 section 69A r.w.s 115BBE of the Act treating the deposits in the bank accounts as unexplained money.
Learned CIT(A) failed to appreciate that appellant/assessee engaged in the business of resin cloth, Velcro tape since past many years. However, during the earlier A.Y. 2012-13, the assessee suffered huge losses of Rs.68,94,204/- and due to such heavy losses, the assessee suffered from Heart Attack. During the course of assessment proceedings, learned AO issued notice under section 142(1) of the Act on 23.06.2021. In response to which, reply dated 27.09.2021 was filed requesting adjournment as the appellant was out of country. Notices under section 148 of the Act dated 30.03.2021, under section 142(1) of the Act dated 23.06.2021, under section 142(1) of the Act dated 21.02.2022, letter dated 04.03.2022 and show-cause notices dated 17.03.2022 and 26.03.2022 could not be complied with as the assessee was out of India and was not intimated by his Counsel. In the appeal, hearing notices dated 28.08.2023, 15.09.2023 and 22.09.2023 could not be complied with as the notices were never served on assessee’s E-mail and the Accountant of assessee did not inform the Counsel of the assessee. Shri Ghanshyam Singhal in an Affidavit dated 16.12.2024 had stated the facts. The assessee may be permitted to assist learned AO.
Vinay Aggarwal vs. ITO A.Y. 2013-14 8. Learned Departmental Representative for the Department of Revenue submitted that despite several notices, assessee failed to assist the departmental authorities.
From examination of record in light of aforesaid rival contentions, it is crystal clear that despite repeated notices, the assessee failed to assist the departmental authorities in assessment and appellate proceedings. Appellant/assessee claims that since he was out of India and was not intimated by Accountant about the departmental proceedings. In view of the above material facts and well settled principle of law, in interest of justice, it is considered expedient to restore the matter to the file of the AO for fresh decision in accordance with law.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order was pronounced in the open court on 18th December, 2024