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Facts
The assessee's case for A.Y. 2013-14 was reopened due to the purchase of an immovable property, with the source of investment initially unexplained. The Assessing Officer (AO) made an addition of Rs. 24,97,500 under section 69 of the Income Tax Act, 1961, as the assessee allegedly did not file a return or provide investment details. The assessee contended that she had filed a return in response to a notice u/s 148 and that the investment originated from the sale of a jointly held shop.
Held
The Tribunal noted that the AO passed an ex-parte order without considering the assessee's explanation and the filed return of income. The delay in filing the appeal was condoned, and the documents, though kept in Calcutta and delayed due to the Covid pandemic, were crucial for a merit-based decision. The Tribunal found it imperative to examine and verify these documents.
Key Issues
Whether the addition of Rs. 24,97,500 under section 69 was justified without properly considering the assessee's filed return and investment source, especially when documents were delayed due to the Covid pandemic.
Sections Cited
69, 147, 148, 139(1), 144, 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER (A.Y. 2013-14) Vibha Subhash Singh Vs. Income Tax Officer- 1601 Viswahans, Sector NFAC, Ward 2(2) 35D, Near Bank of India, Mohan Plaza, 2nd Floor, Kharghar – 410210 Wayale Nagar, Khadakpada, Kalyan (W), Kalyan - 421301 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No:APSPS5258R Appellant .. Respondent Appellant by : Rajeev Waglay Respondent by : S. Arunkumar Date of Hearing 28.02.2024 Date of Pronouncement 29.02.2024 आदेश / O R D E R Per Amarjit Singh (AM): This appeal filed by the assessee is directed against the order passed by the ld. CIT(A) NFAC, dated 07.08.2023 for A.Y. 2013-14. The assessee has raised the following grounds before us: “i. Confirming the addition of Rs. 24,97,500 u/s. 69 of Income Tax Act, 1961 on the ground that the Appellant had neither tendered the Income tax return nor the details of investment as stated by the Assessing Officer without appreciating the fact that the Appellant had filed the return of income in response to notice u/s. 148 on 21.9.2021 under acknowledgment no. 550248700210921 and that this return was very much available on income tax portal. ii. confirming the above addition without appreciating the fact that when the Appellant had invested of Rs. 14,00,000 only in the property, higher value could not have been attributed to the Appellant without any basis.
P a g e | Vibha Subhash Singh Vs. ITO, NFAC, Ward 2(2) Iii confirming the above addition without granting any further opportunity to file the details to prove the source of investment. And hence, the addition of Rs. 24,97,500 confirmed u/s. 69 deserves to be deleted in toto. Your Appellant craves leave to add, alter, modify or delete all or any of the grounds of appeal
.”
2. There was a delay of 12 days in filing this appeal for which the assessee has filed affidavit dated 05.10.2023 for condonation of delay in filing the appeal. In this regard, the assessee has submitted in the affidavit that assessee has not received physical copy of the appeal order but only received message on the mobile on 10.08.2023 communicating that order u/s 250 has been passed in her case. Since, the assessee was not well versed and her chartered accountant was not immediately available, therefore, she could download the order on 30.09.2023 only, therefore, there was marginal delay of 12 days in filing the appeal.
3. Heard both the sides and we find that there is reasonable cause for marginal delay of 12 days in filing the appeal on account of delay in downloading the order of the first appellate authority as discussed supra therefore the delay of 12 days in filing this appeal is condoned.
4. Fact in brief is that assessee has not filed return of income for A.Y. 2013-14. The case of the assessee was reopened on the basis of information available in AIMS Modal ITBA that assessee has purchased immovable property for a consideration of Rs.74,92,500/- in Panvel, Mumbai, and the source of amount invested in the purchase of the property was remained unexplained. Therefore, the case of the assessee was reopened within the provisions of Section 147 of the Act by issuing of notice u/s 148 of the Act dated 12.02.2020 asking the assessee to furnish return of income. In response the assessee submitted that the source of fund invested in the purchased property was out of sale proceeds of the jointly held shop with Savitri Angad Singh for P a g e | Vibha Subhash Singh Vs. ITO, NFAC, Ward 2(2) Rs.46,46,000/- (and share of the assessee was Rs.23,23,000/-). The assessee further submitted that she has filed return of income in response to notice u/s 148 for assessment year 2013-14. However, the AO stated that as per the record no return has been found to be filed by the assessee in the ITBA/E-filing system of the department till the date of passing of the order. Therefore, the AO stated that since assessee has failed to furnish her return of income u/s 139(1) of the Act in response to notice issued u/s 148 of the Act, therefore, assessment was completed u/s 144 of the Act holding that the assessee has not offered any explanation about the nature and source of investment made in the immovable property as per the information available in AIMS modal of ITBA, therefore, 1/3 of the investment to the amount of Rs.24,97,500/- as share of the assessee was remained unexplained and same was added u/s 69 of the Act to the total income of the assessee.
The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee holding that assessee has only provided a copy of return filed for assessment year 2013-14 and computation of receipt, however, source of investment in the said property was not established.
During the course of appellate proceedings before us the ld. Counsel submitted that assessee could not furnish the relevant documents during the course of hearing since all the documents were kept at Calcutta, therefore, requested to provide opportunity for deciding the case on merit after verification of the documents as placed in the paper book. On the other hand, the ld. D.R submitted that there is no objection for sending back the case to the AO for verification and examination of the documents to be furnished by the assessee at the time of set aside assessment proceedings.
P a g e | Vibha Subhash Singh Vs. ITO, NFAC, Ward 2(2) 7. Heard both the sides and perused the material on record. Without reiterating the fact as elaborated above the assessing officer has passed ex-parte order u/s 144 of the Act and treated the share of investment of Rs.24,97,500/- of the assessee in the impugned property as unexplained and added u/s 69 of the Act because of non-availability of return of Income filed by the assessee. The AO further stated that assessee has also failed to comply with the terms of the notice u/s 142(1) of the Act. The assessee has explained that the source of investment was out of the sale of jointly held property and there was delay in collecting the related details and documentary evidences due to prevailing of Covid Pandemic since the documents were placed at Calcutta and the assessing officer had made the impugned addition without considering the reply of the assessee and return of income filed by the assessee. It is demonstrated from acknowledgment of return of and computation of income placed in the paper book that assessee in fact has filed the return of Income and there are other documentary evidences i.e sale deed, purchase deed copies of bank statements etc, as per copies placed in the paper book. The assessee explained that such details and copies of documents were kept at Calcutta and same could not be produced before the AO due to prevailing of the Covid Pandemic at that time. However, the return of income was already filed which was not considered by the AO. After taking into consideration the above facts and material placed in the paper book, it is imperative to examine and verify these details and documents for deciding the issue on merit. Therefore, we restore this matter to the file of the assessing officer for deciding de novo on merit after examination and verification of the detail and relevant document to be submitted by the assessee. Nevertheless, due opportunity may be provided to the assessee. Therefore, the appeal of the assessee is allowed for statistical purposes.