RAMEEZ RAJA BHAT,BUGAM BATAPORA CHADOORA BUDGAM vs. INCOME TAX OFFICER WARD-2 SRINAGAR, SILK FACTORY ROAD RAJBAGH SRINAGAR

The Ld. DR raised his objection, considering the length of the delay but considering the medical issues of the counsel he left it the discretion of the bench. though the delay is long, we are of the opinion that the assessee is a livestock trader engaged in the purchase and sale of jersy cows and is not conversant with computer systems and tax matters and is fully dependent on his lawyer, who was medically indisposed. The appeal has been filed within one month of the receipt of the penalty notices, where the assessee learnt about the existence of the appeal order in quantum proceedings, and we conclude that there was no intentional or willful neglect on the part of the assessee in filing this appeal. As such we condone the delay and admit the appeal to be decided on merits.

The assessee has taken eight grounds of appeal and all the grounds are related to the addition sustained by the Ld. first appellate authority, on account of SBN deposits of Rs. 13.31 lakhs treated as unexplained u/s 69A plus an addition of Rs. 10.49 lakhs as business profits calculated @ 8% of balance cash deposited in bank throughout the year.

In absence of any return on record and in absence of any response to notices issued u/s 142(1) and subsequent notices issued by the AO in course of assessment proceedings, the assessment has been completed ex-parte on the basis of information gathered from banks u/s 133(6) of the Act 61. authority in absence of any response to notices issued on various dates of hearing and in absence of any explanation to source of cash deposited in banks during demo period.

Before the tribunal the Ld. AR of the assessee submitted a short paper book ( fresh evidence ) containing copies of bank statements, profit and loss A/c, print out of cash book for the relevant period, bank certificates giving break up of SBN deposits and other particulars, and submitted that the assessee is engaged in livestock trading ( purchase and sale of jersy cows ) and the cash deposit in banks are his business sale proceeds , and the total of SBN deposits as certified by bankers is only Rs. 6.12 lakhs (and not Rs. 13.31 lakhs as wrongly observed by the AO), because the rest of the bank deposits as certified by the bank , are all new currency, and he further added that the deposits of SBN are out of availability of cash as on the date of demonetization , as recorded in cash book ( now filed for examination ) , and he prayed for a proper hearing , because notice of hearing from the first appeal authority has never been received by the assessee.

The Ld. DR relied on the order of the Ld. CIT(A) but has no objection if the matter is remanded back.

We have considered the materials on record and we find that neither the bankers certificate nor the cash book, has been filed before lower authorities, and the Ld. evidences before him and it is also not ascertainable as to which mail id the notice of hearing has been served on the assessee.

As such we are of the opinion that interest of justice would be served if the matter is remanded to the Ld. first appellate authority to adjudicate on all the grounds contained in form 35 on merits and the assessee is directed to file all supporting documents including cash book and to fully cooperate in appellate proceedings for proper disposal of the appeal.

The assessee will be allowed reasonable opportunity of hearing and notice to be issued as per provisions of section u/s 282 of the Act and also in email id as stated in Form 35.

We have not expressed any opinion on merits and all issues are left open

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