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Facts
The original assessee, Shri Jetha Verva Chavada, died on 20.05.2018 during re-assessment proceedings for AY 2017-18, which resulted in an addition of Rs. 12.58 lakhs under section 69A. His wife, Mrs. Dayaki Jetha Chavada, filed the subsequent appeal to the CIT(A)/NFAC as his legal representative, but the appeal was dismissed for non-prosecution, confirming the Assessing Officer's action.
Held
The Tribunal observed that the CIT(A)/NFAC dismissed the appeal for non-prosecution without formally determining the legal representative status of the appellant, Mrs. Dayaki Jetha Chavada. Consequently, the Tribunal restored the appeal to the CIT(A) to first ascertain her status as a legal representative and then decide the appeal on its merits according to law.
Key Issues
The key legal issues include the CIT(A)'s dismissal of an appeal for non-prosecution, the validity of reopening assessment proceedings and the addition under section 69A, and the determination of the legal representative status of the appellant.
Sections Cited
147, 144, 250, 148, 69A, 151, 2(29)
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Income Tax Appellate Tribunal, MUMBAI BENCH “H (SMC
Before: SHRI SATBEER SINGH GODARA & SHRI OMKARESHWAR CHIDARA
O R D E R Per : Satbeer Singh Godara, Judicial Member: This appellant’s/assessee’s alleged legal representative “LR’s” appeal for assessment year 2017-18, arises against the National Faceless Appeal Centre(NFAC) Delhi’s DIN & order No.ITBA/NFAC/S/250/2023-24/1060872915(1) dated 13.02.2024, in proceedings u/s.147 r.w.s. 144 of the Income Tax Act, 1961 (in short ‘the Act’).
The appellant pleads the following substantive grounds in the instant appeal:
“1. On facts and circumstances of the case and in law Ld. CIT(A) erred in dismissing the appeal.
On facts and circumstances of the case and in law Ld CIT(A) erred in dismissing appeal as the order passed by Ld CIT(A) is not in accordance with the mandate of section 250 of the IT Act as Ld CIT(A) cannot dismiss appeal on account of non- prosecution of appeal by assessee. Reliance is placed on decision of CIT vs Premkumar Arjundas Luthra (HUF) 69 taxmann.com 407 (Bom).
3. On facts and circumstances of the case and in law Ld CIT(A) erred in passing ex-parte without giving adequate opportunity of being heard to appellant.
Without prejudice to other grounds of appeal, on facts and circumstances of the case and in law Ld CIT(A) erred in dismissing appeal without considering merits of addition of Rs 12,58,000/-.
5. On facts and circumstances of the case and in law Ld CIT(A) erred in passing ex parte order without considering merits of reopening of case us 147 and issue of notice us
6. The assessee has not been provided by AO copy of reasons recorded us 147 and approval us 151 of higher authority though request is made before AO. Assessee may be given opportunity of filing additional grounds of appeal, if any, on receipt of said documents.
7. On facts and circumstances of the case and in law Ld. AO erred in reopening the case us 147 of the IT Act without appreciating the fact that assessee is in business of Kirana and geheral store and cash deposits of Rs 12,58,000/- were out of cash sell which were properly reflected in cash book and such deposits were made out of cash on hand as on 8-10-2016 as per cash book.
The appellant craves leave to consider each of the above ground of appeal as independent and without prejudice to each other and craves leave to add, alter, modify or delete any or all grounds of appeal.”
4. It emerges during the course of hearing at the outset with the able assistance coming from both the parties that the CIT(A)/NFAC herein has dismissed the assessee’s lower appeal for non prosecution thereby confirming the Assessing Officer’s action initiating section 148 proceedings culminating in the Assessing Officer had framed his impugned re-assessment on 15.02.2022. The assessee instituted the corresponding lower appeal on 23.09.2022 which has resulted in the CIT(A)/NFAC’s impugned ex-parte order rejecting it for non prosecution.
5. We sought to know the reason of assessee’s non appearance. Learned counsel submits that the assessee herein Shri Jetha Verva Chavada left for his heavenly abode on 20.05.2018 i.e. during the course of re-assessment itself. And that it was in fact his wife (present appellant) Mrs. Dayaki Jetha Chavada who had signed form 35 in the lower appeal and she has been prosecuting the same all along since the assessee’s demise on 20.05.2018. Faced with this situation and in the light of the fact that the appellant herein Mrs. Dayaki Jetha Chavada who claims herself to be the deceased assessee’s legal representative, has nowhere been impleaded as such in tune with section 2(29) of the Act r.w.s. 2(11) of the Code of Civil Procedure, 1908, we deem it appropriate to restore the present appeal back to the CIT(A) to first determine decide the corresponding lower appeal on merits as per law.
Ordered accordingly. We make it clear while parting with we have not expressed any opinion on either the appellant’s status as the legal representative of the deceased assessee or qua merits of the issue(s), as the case may be.
This appellant’s appeal is allowed for statistical purposes in above terms.
Order pronounced in the open court on 24.07.2024.