HARESH ARJANDAS BHATIA,ULHASNAGAR vs. ITO WARD 2(2), KALYAN, KALYAN

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ITA 3632/MUM/2024Status: DisposedITAT Mumbai01 October 2024AY 2017-184 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay of 107 days in filing the appeal in the interest of justice. It noted that the assessee did not respond to various notices issued by the first appellate authority, which led to the ex-parte order. However, the Tribunal also observed that the impugned order lacked reasons. In the interest of justice and fair play, the Tribunal decided to grant a last opportunity to the assessee and remitted the matter back to the file of the learned CIT(A) for adjudication afresh on merits. The assessee was directed to be diligent and cooperative in attending hearings and making submissions, refraining from seeking adjournments except for compelling and unavoidable reasons. The learned CIT(A) was directed to ensure observance of the principles of natural justice. The Tribunal explicitly stated that no observations were made regarding the merits of the case. The impugned order was set aside, and the case was restored to the file of the learned CIT(A) for statistical purposes.

What were the facts?

The assessee, Haresh Arjandas Bhatia, filed his return of income for Assessment Year 2017-18 on August 3, 2017, declaring a total income of Rs. 3,03,520. His case was selected for scrutiny. Notices under Section 143(2) read with Section 142(1) of the Income-tax Act, 1961, were issued and served. The Assessing Officer added Rs. 13,54,500 under Section 69A, attributing it to old currency deposits during demonetization. The assessee appealed to the CIT(A), who dismissed the appeal ex-parte. The assessee then filed this appeal before the ITAT, challenging the ex-parte order of the CIT(A). The appeal was filed with a delay of 107 days, which was condoned.

What were the issues?

1. Whether the learned CIT(A) erred in dismissing the assessee's appeal ex-parte, thereby violating the principles of natural justice, in relation to the addition made under Section 69A of the Income-tax Act, 1961. Assessee's contention: The learned CIT(A) passed the impugned order ex-parte in violation of the principles of natural justice and prayed for the order to be set aside. Revenue's contention: The assessee was provided sufficient opportunity of hearing by the learned CIT(A), and the learned DR supported the impugned order.

Which sections of the Income-tax Act were involved?

Section 69A,Section 143(2),Section 142(1),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘SMC’ BENCH

Before: SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT & SHRI SUNIL KUMAR SINGH

For Respondent: Smt R. M Brindha, Addl

(Assessment Year : 2017–18) Haresh Arjandas Vs. ITO Ward2(2), Bhatia 2nd Floor, Rani Mansion, B K No. 487/A, Murbad Road, Room No. 12 Nehru Kalyan, Thane. Chowk, Ulhasnagar, 421002. PAN/GIR No. AEPPB6748H (Appellant) .. (Respondent) Assessee by Shri. Sanket Joshi (Virtual Mode) Revenue by Smt R. M Brindha, Addl. JCIT (Virtual Mode) Date of Hearing 26/09/2024 Date of Pronouncement 01/10/2024 आदेश / O R D E R PER SUNIL KUMAR SINGH (J.M): 1. This appeal has been preferred against the impugned order dated 31.01.2024 passed in Appeal no. CIT(A), Thane-3/10273/2019-20 by the Ld. Commissioner of Income–tax(Appeals)/ National Faceless Appeal Centre (NFAC) [hereinafter referred to as the “CIT(A)”] u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as "Act"] for the Assessment year [A.Y.] 2017-18, wherein learned CIT(A) has dismissed assessee’s appeal ex-parte.

Haresh Arjandas Bhatia 2. The brief facts of the appeal states that assessee filed his return of income for the A.Y. 2017-18 on 03.08.2017, declaring total income of Rs. 3,03,520/-. The case was selected for scrutiny under CASS. Statutory notices u/s. 143(2) r/w 142(1) of the Act were issued and served upon the assessee. Assessee submitted required details through e-proceedings. After considering assessee’s submissions, learned assessing officer added Rs. 13,54,500/- u/s. 69A of the Act, as the same was deposited in old currency during demonetization period.

3.

Aggrieved by the assessment order dated 19.12.2019, assessee preferred first appeal before learned CIT(A), who dismissed assessee’s appeal ex-parte.

4.

Assessee has filed this second appeal on the ground that learned CIT(A) has erred in confirming the aforesaid addition ex-parte.

5.

In response to the notice issued by the tribunal, learned DR appeared and participated in the hearing.

6.

We have perused the records and heard learned representatives for both the parties.

7.

Learned representative for the assessee has, at the very outset informed that impugned order has been passed by learned CIT(A), ex-parte in violation of the principles of natural justice. Prayed to set aside the impugned order.

8.

Learned DR has submitted that assessee was provided sufficient opportunity of hearing by learned CIT(A). Learned DR has supported impugned order.

9.

At the very outset, this appeal seems to have been filed by a delay of 107 days. In the interest of justice, the delay is condoned.

Haresh Arjandas Bhatia 10. We notice that the assessee did not respond to the various notices issued for hearing for 20.01.2021, 14.07.2023, 26.07.2023 and 17.08.2023 by the first appellate authority. The irresponsive conduct of the appellant assessee compelled learned CIT(A) to pass ex-parte impugned order. On the other hand the impugned order lacks reasons. However, in the interest of justice and fair play, we deem it just and appropriate to afford last opportunity to the assessee and remit the matter back to the file of learned CIT(A) for adjudication afresh on merits. We further direct the assessee to be diligent and cooperative in attending the hearings and making submissions before the learned CIT(A) for the expeditious and effective disposal. Assessee should refrain from seeking any adjournment but for compelling and unavoidable reasons to the satisfaction of the first appellate authority. Needless to say that learned CIT(A) shall ensure the observance of the principles of natural justice. It is made clear that we have not made any observation in respect of the merits of the case.

11.

In the result, the appeal is allowed to the extent as noted hereinabove. Impugned order dated 31.01.2024 is thus set aside. The case is restored back to the file of the learned CIT(A) for statistical purposes. Order pronounced on 01.10.2024.

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