What did the Tribunal hold?

The Tribunal, while acknowledging the assessee's negligence, decided to grant another opportunity for the assessee to substantiate their returned income, considering the principle of natural justice and the high-pitched assessment.

The assessee, a clearing and forwarding agent, filed a return of income for AY 2010-11. The assessment was framed under Section 144 on a best judgment basis due to the assessee's failure to provide requisite details. The assessee also failed to appear before the first appellate authority.

What were the issues?

Whether the assessee should be granted another opportunity to substantiate their returned income before the Assessing Officer, despite past non-compliance.

Dnyanraj Yeshwant Nikam vs ITO | ITAT Mumbai 2018

Income Tax Appellate Tribunal, “D” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY, JM & SHRI MANOJ KUMAR AGGARWAL, AM

आदेश / O R D E R

Per Manoj Kumar Aggarwal (Accountant Member)

Aforesaid appeal by assessee for Assessment Year [AY] 2010-11 contest the order of the Ld. Commissioner of Income-Tax (Appeals)-28 [CIT(A)], Mumbai, Appeal No. CIT(A)-28/IT-155/ITO-12(1)(1)/2013-14 dated 23/11/2016 qua confirmation of certain additions. The assessment for impugned AY was framed by Ld. Income Tax Officer 12(1)(1) on best DnyanrajYeshwantNikam Assessment Year-2010-11 judgment basis u/s 144 on 30/03/2013 wherein the income of the assessee was assessed at Rs.64.69 Lacs as against returned income of Rs.4.86 filed by the assessee in 26/12/2010. The assessee being resident individual was engaged as clearing & forwarding agent in the impugned AY.

As evident from quantum assessment order, the assessee filed to submit requisite details during assessment proceedings as called from time to time. Having no other option, Ld. AO framed the assessment on best judgment basis u/s 144.

Aggrieved, the assessee preferred an appeal against the same before Ld. first appellate authority without any success vide impugned order dated 23/11/2016 wherein the assessee again failed to appear and substantiate the returned income.

The Ld. AR, on the strength of affidavit of the assessee dated 16/07/2018, pleaded for another opportunity to the assessee. The same has been controverted by Ld. DR.

Undisputedly, the assessee has remained negligent to substantiate his claim before both the lower authorities and the approach of the assessee was casual in nature. However, keeping in view that fact that the assessee is an individual and suffered high pitched assessment and keeping in view the principle of natural justice, we deem fit to provide another opportunity to the assessee to substantiate the returned income. Therefore, the matter stand remitted back to the file of Ld. AO with a direction to the assessee to file requisite details / documentary evidences forthwith failing which Ld. AO shall be at liberty to adjudicate the same on the basis of material available on record.

DnyanrajYeshwantNikam Assessment Year-2010-11 6. Resultantly, the assessee’s appeal stand partly allowed for statistical purposes in terms of our above order.

Order pronounced in the open court on 20th July, 2018

DNYANRAJ YESHWANT NIKAM,MUMBAI vs. ITO 12(1)(1), MUMBAI

What did the Tribunal hold?

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