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Facts
The assessee deposited Rs. 29.14 lakhs in bank accounts, which was treated as unexplained investment by the AO and assessed ex parte due to non-response to notices under sections 133(6) and 148 of the Income Tax Act. The CIT(A) subsequently dismissed the appeal ex parte as the assessee failed to file submissions or material. The assessee claims the cash deposit originated from the regular sale proceeds of their Kiryana business.
Held
The Tribunal found that the CIT(A)'s order was passed ex parte without proper service of notice to the assessee's email ID. Consequently, the matter was remanded back to the file of the CIT(A) for fresh adjudication on merits, allowing the assessee a proper opportunity to be heard and to submit all necessary documentary evidence.
Key Issues
Validity of ex parte assessment and appellate orders due to improper notice service; Source and explanation of cash deposits in bank accounts treated as unexplained investment.
Sections Cited
Section 250, Section 144, Section 147, Section 133(6), Section 148, Rule 34(4) of 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 assessee against order of Ld. CIT (A), NFAC, Delhi, passed u/s 250 of the Act 1961, dated 21.09.2023 which has emanated from the order of the AO, Ward-3(2), dated 01/12/2019, passed u/s 144/147 of the Act.
There are six grounds taken by the assessee but all of them pertaining to one single issue of cash deposit in bank amounting to Rs.29.14 lakhs and the main 2 Assessment Year: 2012-13 contention of the assessee is in relation to non-availability of proper opportunity to explain the source of cash deposit.
The brief facts emerging from record are that the assessee has deposited cash amounting to Rs.29.14 lakhs (twenty nine lakh fourteen thousand) in his bank accounts maintained with J & K Bank, Srinagar, and in absence of any explanation or any response to notice u/s 133(6) of the Act, re-assessment proceedings has been initiated by issue of notice u/s 148 dated 11.07.2019. In response to such notice neither any return of income nor any explanation has been filed by the assessee, regarding the source of cash deposited in bank account. As such the same has been treated as unexplained investment made by the assessee and the assessment was completed ex parte on a total income of Rs.29.39 lakhs.
The matter was carried in appeal before the first appellate authority and in absence of any submissions or reply filed by the assessee to notice issued on various dates through ITBA portal, the ld. CIT(A) has dismissed the appeal without adjudicating on merits of case in absence of explanation or material before him.
Now the matter is before the tribunal on the ground contained in form 36.
In course of appeal proceedings before the tribunal the ld. AR of the assessee prayed for adjournment, but we find that no notice of hearing has been received by the assessee from the office of the ld. CIT(A) and it is also evident from para 5.1 of 3 Assessment Year: 2012-13 the appellate order that all notices has been issued through ITBA portal, and no notice has been issued in the e-mail ID contained in form 35. As such, we dispose of the appeal on the basis of SOF contained in the memo of appeal. 6.1 It is also observed that the assessee is engaged in the business of trading of Kiryana goods (groceries) and maintains his bank a/c at J & K bank through which business transactions of Kiryana goods are carried out. As per SOF it is the claim of the assessee that the entire cash deposited in the said bank account is out of regular sale proceeds of his Kiryana business which are also claimed to be supported by documentary evidences.
The ld. DR relied on the order of the ld. CIT(A), but has no objection if the matter is remanded back.
We have perused the materials and we find that the order has been passed ex parte by the ld. CIT(A), without proper service of notice in the e-mail id as provided. As such, we are of the opinion that it will meet the ends of justice, if the matter is remanded back to the file of the ld. CIT(A) for adjudication on the grounds of appeal contained in form 35 on merits, after allowing proper opportunity of being heard. The assessee is also directed to submit all documentary evidences and to fully cooperate with the first appellate authority. 8.1 The assessee will be allowed reasonable opportunity of being heard.
4 Assessment Year: 2012-13 8.2 We have not expressed any opinion on merits and all issues are kept open. 9. In the result, the appeal of the assessee is allowed for statistical purposes.