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Facts
The assessee's appeal against an ex-parte addition of Rs. 52,92,500/- under Section 69 for alleged property purchase was dismissed by the CIT(A) for non-payment of advance tax, without considering the merits. The assessee contended that the property was purchased by family members, not the assessee, and no notice was served for the Section 148 proceedings.
Held
The Tribunal held that the CIT(A) erred in dismissing the appeal at the threshold without addressing the merits, especially since the assessment was framed ex-parte under Section 144. The matter was remitted to the Assessing Officer for a *de novo* assessment, granting the assessee an opportunity to present their case.
Key Issues
Whether an addition under Section 69 made ex-parte under Section 144 should be reviewed on merits, and if the CIT(A) can dismiss an appeal solely for non-payment of advance tax.
Sections Cited
Section 69, Section 144, Section 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “A”, DELHI
Before: SHRI VIKAS AWASTHY & SHRI NAVEEN CHANDRA
अपीलाथ� �ारा/ Appellant by : Shri Abhinarayan Mishra, Advocate �ितवादी�ारा/Respondent by : Shri Kanv Bali, Sr. DR सुनवाई क� ितिथ/ Date of hearing : 14/08/2024 घोषणा क� ितिथ/ Date of pronouncement : 14/08/2024 आदेश/ORDER
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short 'the CIT(A)] dated 09.02.2024, for Assessment Year 2011-12.
Shri Abhinarayan Mishra, appearing on behalf of the assessee submitted that the CIT(A) vide impugned order has dismissed appeal of the assessee merely, for the reason that assessee has not paid advance tax before filing of appeal. The Id. Counsel further submitted that the Assessing Officer (AO) has made addition of Rs. 52,92,500/- u/s. 69 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act). The assessee was not served with any notice; hence, the assessee could not participate in assessment proceedings initiated u/s. 148 of the Act. In fact the income of the assessee is not taxable; hence, the assessee did not file return of income. The Id. Counsel submitted that if the issue is restored back to the file of AO, the assessee would be able to substantiate that addition made u/s. 69 of the Act is not liable to be taxed in the hands of the assessee. He contended that the addition was made on account of purchase of property amounting to Rs. 52,92,500/-. The aforesaid property was purchased by the family members of the assessee and not the assessee and the source of funds for purchase of said property is explainable by the family members.
Per contra, Shri Kanv Bali representing the department vehemently supported the order of CIT(A). He contended that payment of advance tax is a prerequisite for admission of appeal by the CIT(A).
We have heard the submissions made by rival sides and have examined the orders of authorities below. The short issue in appeal is qua addition of Rs. 52,92,500/- u/s. 69 of the Act. The assessment order has been passed in ex-parte proceedings. The CIT(A) refused to entertain the appeal on the ground that the assessee has failed to pay advance tax which he was required to pay as a precondition for admission of appeal by the CIT(A). The short contention of the assessee is that addition us. 69 of the Act has been wrongly made in the hands of the assessee, as the assessee has not purchased any property.
Considering the fact that the assessment was framed u/s. 144 of the Act and the CIT(A) has exited the assessee at threshold, without expressing any opinion on merits, we deem it appropriate to restore this issue back to the file of AO for denovo assessment after affording reasonable opportunity of making submissions to the assessee, in accordance with law.
The assessee shall provide correct/current address/email id for service of notice. The assessee upon service of notice shall respond to the same, without fail.