Loading judgment…
Facts
The assessee deposited Rs. 23.55 lakhs cash in a bank account in FY 2011-12, the source of which was unexplained. The case was reopened, and the assessee stated it was from the sale of a residential house for Rs. 17 lakhs, with Rs. 16.50 lakhs deposited and Rs. 7 lakhs as reverse entries. The AO calculated a capital gain of Rs. 14.59 lakhs and added it to the income, an order upheld by the CIT(A), leading to the present appeal.
Held
The Tribunal found that there was no effective representation on behalf of the assessee before the lower authorities. To uphold natural justice and ensure the assessee gets a proper opportunity to present their case and documentary evidence, the orders of the lower authorities were set aside. The matter was restored to the file of the Assessing Officer for fresh adjudication.
Key Issues
Whether the CIT(A) erred in passing an order without giving the assessee adequate opportunity of being heard, thereby violating principles of natural justice.
Sections Cited
147, 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI
Before: SHRI KUL BHARAT
This appeal, by the assessee, is directed against the order of the learned CIT (Appeals)-2, Jaipur, dated 03.01.2024, pertaining to the assessment year 2012-13.
The assessee has raised following grounds of appeal:
“1. On the facts and circumstances of the case, order passed by CIT(A) AddI/JCIT-2, Jaipur is bad both in the eye of law and on facts.
2.(1) On the facts and circumstances of the case, CIT(A) AddI/JCIT-2 has erred, both of facts and in law, in passing the order without giving assessee an appropriate and adequate opportunity of being heard in violation of the principle of natural justice. (ii) That the reason for non appearance before the CIT(A) AddI/JCIT-2 was beyond the control of the assessee.
3. On the facts and circumstances of the case, CIT(A) AddI/JCIT-2 has erred both on facts and in law in passing the order without giving any findings on the merits of the case 4. (i) On the facts and circumstances of the case, CIT(A) AddI/JCIT-2 has erred, both of facts and in law, in confirming the addition of an amount of Rs. 14,59,200/-, made by the Assessing Officer on account of income from short term capital-gain. (ii) The addition has been made by taking the Sale consideration as the capital Gain against the capital gain actually accrued.
5. The applicant craves leave to add, amend or alter any of the grounds of appeal.”
Facts, in brief, are that as per NMS information received, the AO noticed that during F.Y. 2011-12, relevant to A.Y. 2012-13, the assessee had deposited cash amounting to Rs. 23,55,000/- in his savings bank account with Oriental Bank of Commerce, Israna, Panipat. The assessee had not disclosed the source of deposit. After recording reasons and obtaining prior approval, the case was reopened u/s 147/148. The assessee’s explanation before the AO was that had sold a residential house for sale consideration of Rs. 17,00,000/- out of which cash amounting to Rs. 16,50,000/- was deposited during the relevant period and balance Rs. 7,00,000/- was reverse entries. The AO worked out the capital gain at Rs. 14,59,000/- on sale of residential property as against Rs. 1,94,200/- and added the same to the returned income. Thus, the AO completed the assessment at Rs. 16,41,453/-. Against this the assessee preferred appeal before the learned CIT(A), who dismissed the appeal by affirming the order of AO. Aggrieved, the assessee is in appeal before this Tribunal.
Learned counsel for the assessee submitted that there was no adequate representation on behalf of assessee before the authorities below. She prayed that in the interest of natural justice, orders of authorities below may be set aside and matter restored to the file of AO for decision afresh, after affording adequate opportunity to the assessee to furnish documentary evidence, if any, in support of its case.
Learned DR opposed the submissions made on behalf of the assessee.
I have heard rival submissions and perused the material available on record.
Considering the fact that there was no effective representation on behalf of the assessee before the authorities below, in order to subserve the interests of natural justice and to provide an opportunity to the assessee to effectively represent his case, the orders of authorities below are set aside and the matter is restored to the file of AO for decision afresh, after affording adequate opportunity of being heard to the assessee. Grounds are allowed for statistical purposes.
Appeal of the assessee is allowed for statistical purposes.
Order pronounced in open court on 21.05.2024.