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Facts
The assessee, engaged in fruit trading, made cash deposits of Rs. 28,01,500/- during the demonetization period (F.Y. 2016-17). Due to non-compliance, the AO made an addition under Section 69A and passed an assessment order under Section 144, which was subsequently confirmed by the CIT(A) for similar reasons.
Held
The Tribunal noted the assessee's lack of compliance in prior proceedings but, invoking principles of natural justice, set aside the CIT(A)'s order. The matter was remitted back to the CIT(A) to provide the assessee a fresh and adequate opportunity of hearing to substantiate the case with evidence and information.
Key Issues
Whether the lower authorities were justified in confirming an addition and dismissing an appeal due to non-compliance, without ensuring adequate opportunity of hearing to the assessee.
Sections Cited
144, 250, 69A, 143(2), 142(1)
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Income Tax Appellate Tribunal, PANAJI BENCH
Before: SHRI PAVAN KUMAR GADALE & SHRI G D PADMAHSHALI
सुनवाई क� तार�ख/Date of Hearing 04.03.2025 घोषणा क� तार�ख/Date of Pronouncement 05.03.2025 ORDER
PER PAVAN KUMAR GADALE, JM:
The appeal is filed by the assesse against the order of NFAC/CIT(A) passed u/sec 144 and u/sec 250 of the Act. The assesse has raised the grounds of appeal
challenging the order of the CIT(A) sustaining the addition u/sec69A of the Act made by the Assessing Officer.
2. The Brief facts of the case are that, the assessee is engaged in the retail trading of fruits, The Assessing Officer (AO) based on the information from ITBA data, found that the assesse has made cash deposits in the bank Salim Ali Darugar. account during the demonetization period and the A.O has issued notice u/sec143(2) and u/sec 142(1) of the Act along with questionnaire and the assessee has submitted the partial details in the proceedings. Whereas the A.O found that the assesse has made cash deposits aggregating to Rs.28,01,500/- in the bank accounts in the F.Y.2016-17 and explanations were called to substantiate the deposits and there was no compliance and Since, no explanations/details were filed, the AO considering the information available on record has invoked the provisions of Sec. 144 of the Act and made addition under section 69A of the Act of Rs.28,01,500/- and assessed the total income of Rs.36,97,747/- and passed the order u/sec 144 of the Act dated 9.10.2019.
Aggrieved by the order, the assesse has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts and findings of the AO and has issued notices of hearing and since there was no proper compliance by the assessee to notices. Therefore the CIT(A) considering the information on record has rejected the additional evidences and has confirmed the action of the A.O and dismissed the appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon'ble Tribunal.
4. At the time of hearing, the AR submitted that the CIT(A) has erred in confirming the action of the Assessing officer overlooking the information of the assessment proceedings.
Salim Ali Darugar. Further the assesse has a good case on merits and shall substantiate with the material evidences and prayed for an opportunity to explain before the lower authorities. Per Contra, the Ld.DR supported the order of the CIT(A).
We heard the rival submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no proper compliance in spite of providing adequate opportunity of hearing and the notices were issued. Therefore, the CIT(A) observed that in the assessment proceedings also,the assessee has not participated in spite of providing sufficient opportunities, hence the CIT(A) is of the opinion that the assesse is not interested in prosecuting the appeal and has rejected the additional evidences and dismissed the appeal confirming the action of the assessing officer. The CIT(A) has issued the notices of hearing but there was no proper response and thus the Ld.CIT(A) came to a conclusion that the assessee is not interested and decided the appeal based on the information available on record. Whereas the assessee has raised grounds of appeal challenging the addition by the A.O and there could be various reasons for not explaining the sufficient reasons in filling the new evidences before the CIT(A) and which cannot be overruled. Therefore, considering the facts and principles of natural justice, we shall provide with one more opportunity of hearing to the assessee to substantiate the case with evidences and information.
Salim Ali Darugar. Accordingly, we set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh on the disputed issue and the assesse should be provided adequate opportunity of hearing and shall cooperate in submitting the information. And we allow the grounds of appeal of the assessee for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 05.03.2025.