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Facts
The assessee, an individual, failed to file an income tax return for AY 2017-18. Information about cash deposits during demonetization led the AO to issue notices under Section 142(1) and later 144, which were largely uncomplied with. The assessee's explanation for cash deposits and gold loan repayment was not accepted, leading to an addition of Rs. 9,36,830/-. A subsequent rectification application under Section 154 was rejected.
Held
The Tribunal observed that there was a bona fide reason for the delay in filing the appeal before the CIT(A) and that the assessee had filed a Section 154 application prior to the appeal. Considering the interest of justice, the Tribunal decided to give the assessee one more opportunity before the Assessing Officer.
Key Issues
Whether the appeal dismissed by the CIT(A) for delay should be restored to the Assessing Officer for fresh adjudication, considering the assessee's circumstances and the pendency of a Section 154 application.
Sections Cited
142(1), 144, 154, 271(1)(b)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, BENGALURU “B” BENCH, BENGALURU
Shobha K.N., The Income Tax Officer, No.76, Kanchuraranahalli, Bidadi Ramanagaram, Hobli Ramanagara TQ & Dist 562109, vs. Karnataka, India PAN – BPVPS0491A (Appellant) (Respondent) Assessee by: Sri. Raghavendra R. Chakravarthy, CA Revenue by: Sri. Ganesh R. Ghale, Standing Counsel Date of hearing: 27.08.2024 Date of pronouncement: 02.09.2024 O R D E R PER: PRAKASH CHAND YADAV,J.M. Present appeal of the assessee is arising from the order of ld. CIT(A) dated 3rd June, 2024 having DIN & Order No. ITBA/NFAC/S/250/2024- 25/1065352019(1) and relates to assessment year 2017-18.
Facts leading to the filing of this present appeal are that assessee is an individual could not file the return of income for the impugned assessment year. An information came to the department that the assessee has deposited certain cash during demonetization period. Accordingly, the AO issued notice under section 142(1) of the Income Tax Act and asked the assessee to file the return of income. This notice remains un-complied with by the assessee. Thereafter, the Assessing Officer issued another notice under section 142(1) and finally issued notice under section 144 to the assessee. In response to the Shobha K.N. notice issued under section 144, the assessee, vide her reply dated 17th June, 2019 submitted the details of source of the cash deposit in her bank account. However, the Assessing Officer could not find any force in the submissions of the assessee and added the cash deposit as well as amount utilized for re- payment of gold loan by the assessee. The Assessing Officer has made an addition of Rs. 9,36,830/- and completed the assessment. Aggrieved with the order of the Assessing Officer, the assessee filed one rectification application under section 154 of the Income Tax Act dated 15.10.2019 asking the Assessing Officer to delete the additions made under section 144 assessment. The said rectification application of the assessee stand rejected by the Assessing Officer vide order dated 18.10.2019. Thereafter, the assessee filed an appeal before the ld. CIT(A) on 19.11.2019.
The ld. CIT(A) observed that there was a delay of 39 days’ in filing the appeal before it. The ld.CIT(A) further observed that the assessee has not filed any application vis-a-vis, condonation of delay. Accordingly, the ld. CIT(A) dismissed the appeal of the assessee on account of delay.
Aggrieved with the order of ld. CIT(A), the assessee has come up in appeal before us and contended that assessee being a lady and belongs to a middle class family was not aware of the procedural aspects of the income tax proceedings and the assessee was of the firm belief that her contentions would be appreciated under section 154 of the Income Tax Act. However, when the assessee could not get any relief in 154 proceedings, then upon legal advice, she preferred appeal before the ld. CIT(A) and hence there is a delay of 39 days’. At the outset, ld. counsel for the assessee prayed that the matter may kindly be restored to the file of Assessing Officer for fresh adjudication.
Learned Standing Counsel appearing on behalf of Revenue strongly opposed the condonation plea of the assessee in relation to the delay before
After considering the rival submissions, we observed that the assessee has duly filed an application under section 154, copy of the same has been placed before us and it is also apparent that immediately after the decision of Assessing Officer on 154 application, the assessee filed the appeal before the ld. CIT(A). We are of the view that there was a bonafide reason behind the delay in filing the appeal. We further observed that the Assessing Officer has duly noted the fact of filing the replies by the assessee before him. However, the ld. Assessing Officer has framed the assessment under the provisions of section 144 of the Income Tax Act and that too without any penalty of 271(1)(b).Therefore, considering the totality of the facts, we are of the view that in the interest of justice one more opportunity to be given to the assessee before the AO to present her case. Needless to say that the Assessing Officer would grant meaningful opportunity to the assessee. The assessee is also directed to comply with the notices of the Assessing Officer in fresh proceedings.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 02.09.2024.
Sd/- Sd/- (LAXMI PRASAD SAHU) (PRAKASH CHAND YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER Bengaluru, Dated: 02.09. 2024 Sh