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Facts
The Assessing Officer (AO) made an addition of Rs. 41,18,000 under section 69 of the Income Tax Act on account of unexplained term deposits. The assessee challenged this before the Commissioner, who affirmed the addition of Rs. 42,78,000 after the assessee failed to provide any documents or replies.
Held
The Tribunal noted the assessee's non-compliance but observed that the Commissioner also failed to decide the appeal properly due to lack of relevant documents. Therefore, the case is remanded to the Commissioner for a fresh decision on merits, with an opportunity for the assessee to substantiate their claim.
Key Issues
Whether the addition made by the AO and affirmed by the Commissioner is justified, and whether the appeal should be remanded for a proper adjudication.
Sections Cited
250, 144, 147, 69
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Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SMT. RENU JAUHARI
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the assessee against the order dated 25.10.2023, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) under section 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2011-12.
In the instant case, the Assessing Officer (AO) vide assessment order dated 10.12.2018 under section 144 read with section 147 of the Act made the addition of Rs.41,18,000/- under section 69 of the Act on account of term deposits in bank account by treating the same as unexplained investment.
The assessee, being aggrieved, challenged the said addition before the Ld. Commissioner, who though afforded 4 opportunities to the assessee by issuing notices and fixing the case for hearing, however, the assessee made no compliance with the notices issued and therefore in the absence of any reply/document which the assessee failed to file, the Ld. Commissioner affirmed the assessment order passed by the AO under section 144 read with section 147 of the Act resulting into making of addition of Rs.42,78,000/- as proper and quite in order.
The assessee, being aggrieved, is in appeal before us.
By considering the conduct of the assessee, though, we are inclined not to entertain the appeal of the assessee, however, considering the peculiar facts and circumstances, as the Ld. Commissioner in the absence of relevant reply/documents failed to decide the appeal of the assessee in its right perspective and in proper manner, hence, for the just decision of the case and ends of substantial justice, we are inclined to remand the instant case to the file of the Ld. Commissioner for decision afresh on merits, suffice to say by affording reasonable opportunity to the assessee to substantiate its claim before the Ld. Commissioner.
We also direct the assessee to cooperate with the appellate proceedings and to file the relevant submissions/documents which would be essential and required by the Ld. Commissioner for proper adjudication of the case. We clarify that in case of further default the assessee shall not be entitled for any leniency.
Thus, the case is remanded accordingly.
In the result, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 29.05.2024.