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Facts
The assessee deposited Rs. 20.70 lakhs cash in a J&K Bank account during the demonetization period. With no return of income filed and no response to notices u/s 142(1), the AO completed an ex-parte assessment u/s 144, making additions u/s 69A and estimating business profits. The CIT(A) dismissed the appeal without admitting it, citing non-payment of advance tax and non-submission of return as per section 249(4)(b) of the Act.
Held
The Tribunal condoned a 1-day delay in filing the appeal and remanded the matter back to the CIT(A). The CIT(A) is directed to provide the assessee a fair opportunity to explain with documentary evidence that no advance tax was payable u/s 210. Upon satisfactory explanation, the CIT(A) should dispose of the appeal on merits, waiving the provisions of section 249(4)(b).
Key Issues
1. Whether the CIT(A) was justified in dismissing the appeal under section 249(4)(b) for non-payment of advance tax and non-submission of return without providing an opportunity to the assessee. 2. Condonation of a 1-day delay in filing the appeal.
Sections Cited
250, 144, 249(4)(b), 142(1), 69A, 210, 282, Rule 34(4) of the Income Tax Appellate Tribunal Rules 1963
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Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.
Before: SH. MANOJ KUMAR AGGARWAL & SH. UDAYAN DASGUPTA
ORDER Per: Udayan Dasgupta, J.M.: This appeal is filed by the assessee against the order of ld. CIT (A), NFAC, Delhi, passed u/s 250 of the Act, 1961 vide order dated 29.02.2024 which has emanated from the order of AO, Ward-3, Srinagar, passed u/s 144 of the Act, vide order dated 20.12.2019. 2. Condonation of delay: It is pointed out by the Registry that this appeal is filed belatedly by 1 day.
2.1 In course of hearing the ld. AR of the assessee submitted that the appeal has been dispatched by post on 17th May, 2024 from Srinagar J & K which has reached the office of the tribunal on 20th May 2024 resulting in delay of 1 day and he asked for condonation of the same. Considering the negligible delay, we condone the same and admit the appeal to be heard on merits.
The assessee has taken six grounds of appeal in Form No. 36 and his grievance is mainly due to the fact that the ld. First appellate authority has rejected the appeal without adjudicating on the ground contained in the memorandum of appeal, by refusing to admit the appeal for non-payment of advance tax as per provisions of section 249(4)(b) of the Act.
4. Brief facts of the case are that the assessee has deposited cash amounting to Rs.20.70 lakhs in J & K Bank A/c during demonetisation period and in absence of any return on record, and in absence of any response to various notices issued u/s 142(1) of the Act, the assessment was completed ex parte on a total income of Rs.37.58 lakhs (which include addition u/s 69A amounting to Rs.20.70 lakhs being the SBN deposit in bank (plus) the estimation of business profits of Rs.16.88 lakhs being the 8% of the balance deposit in bank account).
5. The matter is carried in appeal before the ld. First appellate authority has been dismissed without admitting the said appeal on the issue of non-payment of advance tax coupled with non-submission of return thereby violating the provisions of section 249(4)(b) of the Act.
The ld. AR, in course of hearing submitted that the assessee is engaged in the trading business and the deposit of cash in the bank a/c are out of his sale proceeds from the said business. He further submitted that out of the total addition made by the AO on account of SBN deposits amounting to Rs.20.70 lakhs, only, an amount of 4.47 is lakhs deposit of old currency and the balance are all new currency notes as certified by the bank authorities. 6.1 He further submitted that before rejection of the appeal u/s 249(4)(b), the ld. CIT(A) has not allowed an opportunity to the assessee to explain his case and his contention is that if proper opportunity is allowed he will prove with evidence on record that no advance tax is payable by the assessee u/s 210 of the Act, in the instant case and as such, he prays for fair opportunity of hearing to prove his case.
The ld. DR relied on the order of the ld. CIT(A) but has no objection if the matter is remanded back to the file of the ld. First appellate authority for considering the issues on merits.
We have heard the rival submissions and considered the materials on record and we are of the opinion that in the interest of justice will be served if the matter is remanded back to the file of the first appellate authority where the assessee is to be allowed an opportunity to explain with documentary evidences that the assessee is not liable to pay advance tax u/s 210 of the Act 61 and the provisions of section 249(4)(b) can be waived.