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Facts
The assessee, an NRI, did not file his return of income for AY 2016-17. The AO reopened the case based on an agreement for flat purchase and housing loan availed by the assessee, leading to an addition of Rs.28,11,036/- as undisclosed interest income. The CIT(A) upheld the AO's order, citing non-compliance by the assessee.
Held
The Tribunal observed that while the assessee challenged the additions, they failed to substantiate their claim before the first appellate authority. However, considering the principles of natural justice, the assessee was granted one more opportunity.
Key Issues
Whether the ex parte order of the CIT(A) violated principles of natural justice and whether the addition of Rs.28,11,036/- as undisclosed interest income was justified.
Sections Cited
250, 148, 144C(1), 147, 144C(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
O R D E R Per Kavitha Rajagopal, J M:
This appeal has been filed by the assessee, challenging the ex parte order of the learned Commissioner of Income Tax (Appeals) (‘ld.CIT(A) for short), National Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2016-17.
The assessee’s appeal has challenged the ex parte order of the ld. CIT(A) on the 2. violation of principles of natural justice and has also challenged the addition of Rs.28,11,036/- towards undisclosed interest income along with other grounds.
The brief facts are that the assessee is an NRI and had not filed his return of income for the year under consideration. The ld. Assessing Officer ('A.O.' for short) reopened the assessee’s case for the reason that the assessee along with his wife had (A.Y.2016-17) Robinson Anthony Dsilva vs. ITO (IT) entered into an agreement for purchase of flat at Kandivali at Mumbai for a sale consideration of Rs.1,73,00,500/- in installments with M/s. Hiranandani Constructions Pvt. Ltd. The assessee has also availed housing loan from ICICI Bank Ltd. and had made advance payment of installments to the Builder. The assessee has also incurred interest expenditure on the said amount. The assessee is also said to have not filed return of income in response to the notice u/s. 148 of the Act and thereby the ld. A.O. passed the draft assessment order dated 21.03.2022 u/s.144C(1) of the Act and the final assessment order dated 13.05.2022 u/s. 147 r.w.s. 144C(3) of the Act, thereby determining the total income at Rs.28,11,036/- by making an addition under ‘income from other sources’ on the undisclosed interest income.
Aggrieved, the assessee was in appeal before the first appellate authority, where the ld. CIT(A) upheld the order of the ld.A.O. for the reason that the assessee has been non compliant before the first appellate authority.
The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A).
We have heard the rival submissions and perused the materials available on record. It is observed that the assessee has challenged the additions made by the ld. A.O. but has made only written submission as to the statement of facts before the first appellate authority but has beyond that failed to substantiate his claim.
The learned Authorised Representative ('ld. AR' for short) for the assessee contended that the assessee has got a good case on the merits and prayed that the assessee may be given one more opportunity to present his case before the ld. CIT(A).
(A.Y.2016-17) Robinson Anthony Dsilva vs. ITO (IT) 9. The learned Departmental Representative ('ld.DR' for short) vehemently opposed to setting aside the issue to the file of the ld. CIT(A) for the reason that the assessee was given several opportunity by the ld. CIT(A) which was not availed by the assessee.
On the above factual matrix of the case, we are of the considered view that the assessee may be given one more opportunity to present his case before the first appellate authority by adhering to the principles of natural justice. We, therefore, remand all these issues back to the file of the ld. CIT(A) for de novo adjudication on the merits of the case.
The assessee is directed to comply with the proceedings without any undue delay on his side.
In the result, the appeal filed by the assessee is allowed for statistical purpose.
Order pronounced in the open court on 31.07.2024