M/S. GOLD PALACE JEWELLERS,BENGALURU vs. ACIT, CIRCLE-1(1)(1), BENGALURU

This appeal at the instance of the assessee is directed against the order of CIT(A)/NFAC dated 4.7.2024 vide DIN & Order No.ITBA/NFAC/S/250/2024-25/1066405027(1) for the assessment year 2017-18. The assessee has raised following grounds of appeal:

Brief facts of the case are that the assessee is a partnership firm and engaged in the business of dealing in gold and diamond jewellery, silver articles and other precious metals. It purchases gold bullion from wholesalers, gets it converted into gold jewellery and sells the same. Further, the assessee firm also purchases old gold ornaments from individuals and converts the same into jewellery. For the assessment year 2017-18, the assessee firm filed its return of income on 29.10.2017 declaring total income of Rs.24,89,750/-. The case was there after taken up for complete scrutiny under CASS. The only issue that arose during the course of assessment proceedings is the source of cash deposited during the period of demonetization. During the course of assessment proceedings, as M/s. Gold Palace Jewellers, Bangalore Page 3 of 5 the assessee failed to justify the source of cash deposited amounting to Rs.2,44,46,257/-, the AO treated the same as unexplained money u/s 69A of the Act and brought to tax in the assessee’s hand.

Before us, ld. A.R. of the assessee vehemently submitted that the appeal was instituted on 14.1.2020. Thereafter, the assessee has been served two notices for hearing on 7.3.2020 and 13.3.2020, M/s. Gold Palace Jewellers, Bangalore Page 4 of 5 which is at the verge of the Covid Pandemic. Thereafter, after a gap of 4 years the ld. CIT(A) passed the order without giving reasonable opportunity of being heard, which is a gross violation of principles of natural justice.

Ld. D.R. on the other hand, supported the order of the authorities below.

We have heard the rival submissions and perused the materials available on record. On going through the appellate order, we note that the appeal of the assessee filed electronically on 14.1.2020 against the order of ld. DCIT Circle-1(2)(1), Bangalore passed u/s 143(3) of the Act on 23.12.2019. Thereafter, hearing notices were sent on 7.3.2020 and 13.3.2020. The appeal filed by the assessee is disposed of after taking into consideration the material available on record on 4.7.2024 i.e. after gap of more than 4 years. We find force in the argument of the ld. A.R. of the assessee that ld. CIT(A) has passed an order after a gap of more than 4 ½ years that too without providing any reasonable opportunity of being heard to the assessee. Being so, considering the submission of ld. A.R. of the assessee and in the interest of justice and fair play, we remit the matter to the file of ld. CIT(A)/NFAC for fresh consideration and decision as per law after affording a reasonable opportunity of being heard to the assessee. The assessee is directed to produce all the necessary documents/records/information in support of his case and shall not seek unnecessary adjournments. It is ordered accordingly.