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Facts
The assessee, an educational trust, did not file returns for AY 2015-16 and 2016-17, claiming no taxable income. The AO reopened the cases under section 147/148 to explain cash deposits, treating them as unexplained money u/s 69A and making additions for interest income u/s 69C.
Held
The Tribunal held that the CIT(A)'s decision that sufficient opportunities were granted was incorrect, given that assessment proceedings occurred during the COVID-19 period. Therefore, the matters were restored to the AO for fresh decision.
Key Issues
Whether the assessee was granted sufficient opportunities during assessment proceedings conducted during the COVID-19 period, and if additional evidence should be considered on remand.
Sections Cited
147, 148, 69A, 69C
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Income Tax Appellate Tribunal, “C’’ BENCH: BANGALORE
Before: SHRI PRASHANT MAHARISHI & SHRI PRAKASH CHAND YADAV
PER PRAKASH CHAND YADAV, JUDICIAL MEMBER:
Both these appeals of the assessee are arising from the order of ld. CIT(A) dated 11.9.2024 & 24.7.2024 for AY 2015-16 & 2016-17 respectively.
It is relevant to mention here that there is a delay of 10 days in respect of the appeal for AY 2015-16 and 59 days in respect of AY 2016-17. Explaining the cause of delay, ld. Counsel for the assessee has drawn the attention of the bench towards the condonation application duly supported with affidavit and contended that Mrs. Priti S. Gowda, who was handling the taxation matters, was unwell due to health issues and hence, there is a delay of 10 days and 59 days.
Ld. D.R. could not seriously object to the condonation of delay.
Considering the facts and circumstances of the case, we are of the view that it is a case of ordinate delay, therefore, we hereby condone the delay & 2212/Bang/2024 Blessing Educational Trust, Kolar Page 2 of 3 happened in filing appeal before the ITAT and proceed to decide the matter on merits.
The assessee is an educational trust and running educational institutes at different level. For both the years, the assessee has not filed any return of income on the ground that there was no taxable income of the assessee for the impugned years. Thereafter, both cases of the assessee are reopened u/s 147 r.w.s. 148 of the Act, for explaining the source of cash deposited in the bank account of the assessee. At the time of assessment proceedings, no one appeared on behalf of the assessee, since the proceedings were happened during Covid-19 period. The AO finally framed the assessment by treating the cash deposits as unexplained money u/s 69A of the Act. Ld. AO has also made additions u/s 69C of the Act in respect of the interest income received by the assessee.
Aggrieved with the order of AO, the assessee preferred appeals before the ld. CIT(A) and in order to explain the source of cash, the assessee has filed certain documents as additional evidences. The ld. CIT(A) after calling a remand report from the AO dismissed the appeal of the assessee on the ground that since sufficient opportunities were granted by the AO at the time of assessment and hence the additional evidences filed by the assessee are not admissible. The ld. CIT(A) confirmed the additions made by the AO.
Aggrieved with the order of ld. CIT(A), the assessee has come up in appeal before us and has raised number of grounds which are argumentative in nature. However, the ld. Counsel for the assessee at the outset submitted that purpose of justice would be served if one more opportunity before the AO would be granted to the assessee for explaining the source of cash deposit with the bank.
Ld. D.R. appearing on behalf of the revenue pointed out that the assessment proceedings were concluded in Covid period and therefore, in the interest of justice, matter may be restored to the file of AO for examining afresh.
We have heard the rival submissions and perused the materials available on record. After perusing the dates and events happened at the end of AO, we & 2212/Bang/2024 Blessing Educational Trust, Kolar Page 3 of 3 are of the view that the decision of ld. CIT(A) holding that sufficient opportunities were granted to the assessee is not correct, as the proceedings of assessment were happened during Covid 19 period. Therefore, considering the facts and circumstances of the case, we hereby restore these matters to the file of AO for deciding afresh in accordance with law. The assessee is also directed to place on record all the relevant evidences before the assessing officer. It is also directed that assessee will not take unnecessary adjournments before the AO and cooperate in the assessment proceedings.
In the result, both these appeals of the assessee are allowed for statistical purposes.
Order pronounced in the open court on 24th Dec, 2024