SUSHIL KUMAR,MUZAFFARNAGAR vs. ITO, MUZAFFARNAGAR

1. “That the Ld. CIT (A) has erred in law and on facts in holding that notice u/s 148 was properly served upon the appellant and consequently the assessment made u/s 144/147 was valid in law & also action u/s 148 was rightly initiated by the AO.

That the Ld. CIT (A) has erred in law in upholding the addition of Rs. 11,00,500/- made by the AO & adding towards appellant’s income from business offered under the presumptive provisions of Section 44AD & 44AF of the Income Tax Act. 3. That the Ld. CIT (A) has filed to appreciate the material on record as also before the AO, not justifying any additions towards the appellant’s income. 4. That the appellant reserves his rights to add, amend or modify any ground of appeal

It is the argument of the Ld. AR that though it was explained to the authorities below that his father of the assessee got heart attack and was under treatment, as such, the assessee was in village Kaschri looking after his father in the year 2009 and that subsequently the assessee had to shift his residence to Rookee for employment, as such, he did not receive the notice there was no proper appreciation of this fact by the authorities. As a matter of fact, ld. AR submits that the assessee was regularly assessed to tax since AY 1992-93 and was declaring the income at 8% of the contractual receipts and other income from retail trading of medicines. However, AO was not convinced with the submissions of the assessee in respect of non compliance with the notices. Ld. AR submits that the assessee was prevented by sufficient reason from complying with the alleged notices said to have been issued by the AO. In the circumstances, it is prayed on behalf of the assessee that if an opportunity is granted to him he would cooperate with the assessee for assessment of his just tax liability by producing all the relevant documents. Ld. DR vehemently relied upon the orders of the authorities below and submitted that the assessee is guilty of willful non cooperation with the proceedings, as such, the AO is justified in completing the reassessment u/s 144 of the Act.

We have carefully gone through the record and the history of the proceedings as recorded by the AO and the CIT in their orders. However, it is evident from the record that though the notices were said to have been issued, there is no evidence to show that those notices were served on the assessee. Explanation offered by the assessee is that due to the ill health of his father and for employment the assessee was away from his address that was available with the authorities. Since the reassessment had to be completed within the period of limitation, proceedings are concluded u/s 144 of the Act drawing a presumption that the assessee must be aware of the pending proceedings. Now that the assessee prays for an opportunity to cooperate with the authorities for determination of the tax liability. Having a careful regard to the facts and circumstances of the case, we are of the considered opinion that no prejudice would be caused to either of the parties if an opportunity is granted to the assessee for producing the documents if any before the AO for determination of his just tax liability. With this view of the matter, we find it just and proper to set aside the issue to the file of the AO for reassessment afresh after giving an opportunity to the assessee to cooperate with the disposal of the matter. It is made clear that it is the last opportunity for the assessee to get the matter disposal on merits. We, accordingly, restore the matter to the file of the AO.

In the result, the appeal of the assessee is allowed for statistical purposes.