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Facts
The assessee, an individual in business, made significant cash deposits (Rs. 1.07 Cr) but failed to file an income tax return. The AO, believing income escaped assessment, issued a notice under Section 148, but the assessee's subsequent income declaration under Section 44AD was rejected, and there was non-compliance to further notices. Consequently, the AO made additions for cash deposits under Section 69A and interest income, passing an order under Section 144 r.w.s. 147.
Held
The CIT(A) dismissed the assessee's appeal as infructuous due to non-compliance and non-payment of taxes under Section 249(4)(b). The Tribunal, however, emphasizing principles of natural justice, set aside the CIT(A)'s order and remitted the entire disputed issues back to the CIT(A) for fresh adjudication, granting the assessee another opportunity.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal for non-compliance and non-payment of taxes, and if the assessee should be granted another opportunity to represent their case before the appellate authority.
Sections Cited
144, 147, 250, 148, 44AD, 142(1), 133(6), 69A, 249(4)(b)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PANAJI BENCH
Before: SHRI PAVAN KUMAR GADALE & SHRI G D PADMAHSHALI
सुनवाई क� तार�ख/Date of Hearing 27.01.2025 घोषणा क� तार�ख/Date of Pronouncement 28.01.2025 ORDER
PER PAVAN KUMAR GADALE, JM:
The appeal is filed by the assesse against the order of National Faceless Appeal Centre (NFAC) Delhi / CIT(A) passed u/sec 144r.w.s 147 and u/sec 250 of the Act.
The brief facts of the case are that, the assessee is a individual and is engaged in the business. The Assessing Officer (AO) based on the information from ITBA data, found that the assesse has made cash deposits in the bank Sameer Manohar Fulari... account and the assesse has not filed the return of income and the Assessing Officer (A.O) has reason to believe that income has escaped and issued the notice u/sec148 of the Act and the assessee has submitted income computation declaring the profit @8% of Gross receipts of Rs.1,38,35,000/- u/sec 44AD of the Act and it was not accepted by the A.O. Further the notice u/sec 142(1) of the Act along with questionnaire was issued on various dates and there was no compliance. Whereas the A.O found that the assesse has made the cash deposits aggregating to Rs.1,07,34,000/- in the bank account in the F.Y.2017-18 and explanations were called to substantiate the deposits. Since, no explanations/details were filed, the AO considering the information available on record and has issued notice u/sec133(6) on the bank and called for the Bank statement of the assessee. The A.O has invoked the provisions of Sec.144 of the Act and made addition of cash deposits of Rs.1,07,34,030/- u/sec69A of the Act and the interest income of Rs.35,753/- and finally assessed the total income of Rs.1,07,69,783/- and passed the order u/sec 144 r.w.s147 of the Act dated 10.03.2023.
Aggrieved by the order, the assessee has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts, findings of the AO and Form no 35 and find that the assessee has not paid the taxes and the provisions of section 249(4)(b) of the Act Sameer Manohar Fulari... are attracted and has issued letter and since there was no compliance by the assesse, the CIT(A) has dismissed the appeal as infructous. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon'ble Tribunal.
We heard the Ld.DR submissions and perused the material on record and none appeared on behalf of the assesse. Prima-facie the CIT(A) has passed the order considering the fact that there is no compliance to the letter nor appearance in spite of providing adequate opportunity of hearing. Therefore, the CIT(A) was of the opinion that the assesse is not interested and find that as per Form no 35, the assessee has not paid the taxes/advance tax and the provisions of section 249(4)(b) of the Act are attracted and the CIT(A) has issued letter dated 19.09.2023 referred at Page 3 Para4.4 of the order and there was no response and hence the CIT(A) has dismissed the appeal as infructous. Whereas the assesse has raised grounds of appeal challenging the additions by the A.O and there could be various reasons for non appearance/ compliance which cannot be overruled. Further, in the case, were the return of income is not filed by the assessee and the case falling under section 249(4)(b) of the Act, there is a provision, provided that, the assessee can make an application to appellate authority explaining the good and sufficient reasons for claiming the exemption. Therefore, considering the facts and principles Sameer Manohar Fulari... of natural justice, we shall provide with one more opportunity to the assessee. Accordingly, we set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) as discussed above. And, we allow the grounds of appeal of the assesse for statistical purpose.
In the result, the appeal filed by assessee is allowed for statistical purposes.
Order pronounced in the open court on 28.01.2025.