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Facts
The assessee failed to file income tax returns for AY 2013-14 and subsequent years, and did not respond to statutory notices. The Assessing Officer reopened the case under section 147, added unexplained cash deposits and credit entries in the bank account, and passed best judgment assessments. The CIT(Appeals) dismissed the assessee's appeals ex parte.
Held
The Tribunal noted the assessee's negligent conduct but, in the interest of justice and fair play, decided to afford an opportunity for the assessee to make submissions. The impugned orders were set aside, and the matters were remitted back to the Assessing Officer for fresh adjudication.
Key Issues
Whether the assessee was afforded proper opportunity of hearing by the revenue authorities, and whether the ex parte orders passed violated principles of natural justice.
Sections Cited
147, 144, 144B, 69A, 271(1)(c)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AGRA BENCH, AGRA
Before: SHRI M. BALAGANESH & SHRI SUNIL KUMAR SINGH
ORDER PER : SUNIL KUMAR SINGH, JUDICIAL MEMBER: for A.Y. 2013-14 has been preferred against the impugned order dated 24.02.2025 passed by Ld. CIT(Appeals)/NFAC, Delhi in first appeal No. NFAC/2012-13/10299278, wherein Ld. CIT(Appeals) has dismissed assessee’s appeal ex parte and confirmed assessment order dated 21.04.2023 passed u/s. 147 r/w sec. 144/144B of the Act. for A.Y. 2014-15 has been filed against the order dated 24.02.2025 passed by CIT(Appeals)/NFAC, Delhi in first appeal No. NFAC/2013-14/10302964, wherein Ld. CIT(Appeals) has dismissed assessee’s first appeal ex parte and confirmed assessment order dated 25.03.2022 passed u/s. 15 has been filed against the order dated 28.03.2025 passed by Ld.
CIT(Appeals)/NFAC, Delhi in first appeal No. NFAC/2013-14/10302965, wherein Ld. CIT(Appeals) has dismissed assessee’s first appeal ex parte and confirmed the penalty order dated 22.09.2022 passed u/s. 271(1)(c) of the Act.
The facts in all the three appeals are almost either similar or consequential. Hence, for the sake of brevity and convenience, these appeals are being decided by the common order. The facts of for the assessment year 2013-14 are only being narrated as under :
The assessee did not file any return of income for the assessment year 2013-14 and the case was reopened u/s. 147 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) for the reason that assessee deposited cash of Rs.29,78,300/- and credit entries of Rs.33,63,854/- in his bank account No. 21651930000187, HDFC Bank Ltd. Kirawali, Agra. The assessee did not respond and comply with various statutory notices. Hence, the ld. Assessing Officer completed the assessment u/s. 147 read with section 144 r/w 144B of the Act and 2 | P a g e added Rs.63,42,154/- as unexplained cash deposits and credit entries in assessee’s bank account u/s. 69A of the Act.
Aggrieved assessee filed an appeal before the ld. CIT(Appeals), who, vide, ex parte order dated 24.02.2025, dismissed assessee’s first appeal.
Aggrieved, the assessee filed this second appeal on the ground, in addition to many others, that learned CIT(Appeals) has not afforded proper and adequate opportunity of hearing to the assessee.
Perused the records and heard learned representative for the assessee and learned DR for the revenue.
Learned representative for assessee has submitted that both the revenue authorities have passed ex parte orders against the assessee in violation of the principles of natural justice, praying to afford an opportunity to the assessee to make his submissions before the Assessing Officer so as to explain the cash deposits and cash credits in the bank account.
Learned DR has submitted that the assessee was afforded many opportunities by the first appellate authority, but he did neither respond nor make any submission. Supported the impugned ex parte order passed on merits.
We notice that the learned Assessing Officer made the best judgment assessment u/s. 144B of the Act for want of any submissions by the assessee. We further notice that the first appellate authority issued various notices on 06.06.2024, 14.06.2024, 02.07.2024, 18.07.2024, 05.08.2024, 16.08.2024 and 06.02.2025, but for no avail.
The negligent conduct of the reluctant assessee cannot be appreciated.
However, we deem it just and appropriate in the interest of justice and fair play to afford an opportunity to the assessee to make requisite submissions/explanations before the learned Assessing Officer.
Accordingly, the impugned order is set aside and the matter is remitted back to the file of the Assessing Officer. The assessee is directed to submit explanations/submissions before the Assessing Officer in respect of cash deposits of Rs.29,78,300/- and credit entries of Rs.33,63,854/- in his bank account, as required by the revenue. The Assessing Officer is directed to adjudicate the matter afresh in accordance with law after due consideration of assessee’s submission/explanation. Needless to say that the ld. Assessing Officer shall ensure the observance of the principles of natural justice during the course of proceedings.
Accordingly, the appeal is liable to be allowed for statistical purposes.
Since, the issue involved in for A.Y. 2014-15 is identical to one involved in ITA No. 200/Agr/2025(A.Y. 2013-14) and 4 | P a g e the penalty levied u/s. 271(1)(c) of the Act in consequence of assessment order passed in our finding in (A.Y. 2013-14) shall mutatis mutandis apply in these two appeals too. Accordingly, both these appeals are also liable to be allowed for statistical purposes.
201 & 198/Agr/2025 are allowed for statistical purposes.
Order pronounced in the open court on 29.08.2025.