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Facts
The assessee filed an appeal against the order of the CIT(A) for assessment year 2012-13. The assessee claimed that the assessment order was passed ex-parte due to medical illness and lack of understanding of the faceless appeal process. The assessee also requested for condonation of delay in filing the appeal and to admit additional evidence.
Held
The Tribunal condoned the delay in filing the appeal, allowing the assessee's prayer due to sufficient cause. The Tribunal also admitted the additional evidence filed by the assessee. However, for the lethargic and negligent action of the assessee, a cost of Rs. 2,000/- was imposed.
Key Issues
Whether the ex-parte assessment order and the CIT(A)'s order confirming it are sustainable in law, and whether additional evidence should be admitted.
Sections Cited
234A, 234B, 234C, 147, 144, 148, 250, Rule 29 of ITAT Rules 1963, Section 5 of Limitation Act
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Income Tax Appellate Tribunal, JAIPUR BENCHES, ‘’SMC” JAIPUR
Before: Hon’ble SHRI SANDEEP GOSAINvk;dj vihy la-@ITA No. 802/JP/2024
ORDER PER: SANDEEP GOSAIN, JM This appeal filed by the assessee is directed against order of the ld. CIT(A) dated 29-11-2023, National Faceless Appeal Centre, Delhi [ hereinafter referred to as (NFAC) ] for the assessment year 2012-13 raising following grounds of appeal. ‘’1. That Ld AO has grossly erred in facts & in law and all the allegations as made out in the assessment order are not accepted to appellant and are denied outright and further Ld CIT(A) has further erred in confirming same without going into merits of the case and without ascertaining the factual position of the case.
1. SMT SONU VS ITO, WARD - DAUSA 2. That Ld AO has erred in passing of ex parte assessment u/s. 147 r.w.s.144 of I.T. despite of fact that appellant has submitted adjournment application to Ld AO stating about his medical illness and has also produced medical certificate, but despite of submission of same of before Ld AO, passing of ex-parte order is lacking opportunity of being heard and same may please be declared as illegal and be deleted.
3. That Ld AO has grossly erred by doing addition of Rs.14,02,559/- (1/3rd part) as unexplained income and added to the total income of appellant under the head ‘’Income from other sources’’ without stating any specific reference under which provision of I.T. Act,such addition is made. That the ld. AO has erred while doing such addition into total income whereas there is no such sum has ever been paid to Mr. Shivram Bairwa for getting registration of sale deed. The appellant for want of securing their invested fund has executed the sale deed from Shivram Bairwa. Thus despite of having such fact on record about non-receiving of any monetary consideration by appellant, treating same as sale consideration received by appellant is absolutely illegal approach of AO and ld CIT(A) which may please be set aside.
4. That Ld CIT(A) NFAC has stated that opportunities were provided but no such real opportunity of being heard has ever been provided. No notice from the local Jurisdictional assessing officer through post has ever been provided for appeal hearing. All communication might have been made through Income tax e portal and appellant being illiterate lady could not understand the intricacies therefore could not respond to these notices. Thus entire proceedings were undertaken ex- parte and without looking for merits of the case and same may please be held as illegal and unjustified and be set aside.
5. That the ld. AO has erred in levying of interest u/s 234A, 234B and 234C which being consequential in nature and may please be deleted.’’ 2.1 At the outset of hearing of the appeal, the Bench noticed that there is a delay of 122 days in filing the appeal for which the assessee has filed an application for condonation of delay with following prayer. ‘’2. That the appellant belongs to bare remote village area. That appellant is not much literate and is engaged in doing the agricultural work and other miscellaneous income activities in village. That do not have any access to the Income tax portal and do not check any regular messages as received on mobile phone.
SMT SONU VS ITO, WARD - DAUSA 3. That once a while at time of check of Income tax portal on dt. 14.5.2024 and it has gathered for the first time that appeal order dt.21.12.2023 has been passed and then appellant took all the steps for filing of appeal against the appeal order dt.21.12.2023. To this effect, the assessee has submitted an affidavit deposing the above facts 2.2 On the other hand, the ld. DR objected such inordinate delay and submitted that the Court may decide the issue as deem fit and proper in the case. 2.3 After hearing both the parties and perusing the materials available on record and affidavit of the assessee, the Bench noted from the condonation of application of the assessee that there is a merit and sufficient cause in condoning the delay. Hence, the delay is condoned. 3.1 During the course of hearing the ld.AR of the assessee has filed an application under Rule 29 of ITAT Rules 1963 for allowing to submit additional evidences which the assessee has mentioned at assessee’s paper book pages 6 to 8 . The contents mentioned in the application are as under:- ‘’1. Most respectfully the humble appellant do hereby seeks leave of the Hon'ble Bench for allow to submit Additional Evidences in support of the case which are quiet essential and crucial for decide of the case. That additional evidences which are being submitted are consisting of below documents:- S.No Particulars/ Details of documents 1. Sale deed (impugned sale deed) dt.26.03.2012 wherein consideration is mentioned of Rs.37,50,000/- of converted commercial Land with construction (land Khasra no.: 852/658, Bilona Kalan, Mahua) 2. Purchase deed of agricultural Land Khasra no.: 852/658, Bilon Kalan, Mahua by Shiv Ram Bairwa 3. Joint business agreement dt. 13.10.2009 between (i) Mr. Shivram Bairwa SMT SONU VS ITO, WARD - DAUSA and (ii) Ms. Sonu, Ms. Shikha, Mr. Rajesh, Mr. Govind, Ms. Madhuri 4. Settlement deed dt. 26.03.2012 between all above parties 5. Bank statement and other evidences of Ghanetwal family with regard to evidence of getting construction on Land owned by Mr. Shivram Bairwa 6. Capital Account, Balance Sheet for f/year 2009-10, 2010-11, 2011-12 7. Bank statement of Ms. Madhuri/ Novin Jaiswal, Ahemdabad from which fund are transferred to Mr. Rajesh, Govind Ghanetwal for Midway Dhaba Construction.
Income tax return for AY 2012-13 of Ms. Madhuri and Income Statement of Mr.Novind Jaiswal of doing job our of India for respective years.
Income tax assessment order for AY 2012-13 of Ms. Madhuri by IT Department, Ahemdabad 10. Affidavit of Ms. Sonu stating all above facts of the case. That all above documents could not be submitted before the Ld AO during course of assessment proceedings due to medical illness for which medical certificate dt.26.11.2019 which is issued by Government Medical Doctor wherein she was advised to take rest for 21 days which comes to 15.12.2019 and assessment order is passed on dt.12.12.2019. Copy of Medical certificate dt.26.11.2019 issued by Medical Incharge is enclosed and marked as Annexure-
1. 1. Therefore assessee was deprived for submission of all above documents before Ld AO during course of assessment.
2. That against the impugned order the appellant has submitted before CIT (Appeals) and which was filed on dt.08.01.2020 within stipulated time and thereafter the mechanism for conduct of appeal was changed by Government from manual appeal to faceless appeal. And as per that mechanism all notices were about to send through mobile messages, the appellant being from rural background could not undersrtand the intricacies and could not check up mobile messages. Therefore, under genuine impression that appeal case is going on and all these documents will be submitted as soon as appeal will be fixed for hearing. That on one day (i.e. on dt.29.04.2024) suddenly the appellant came to know that one notice in case of another buyer/transferee (Smt. Shikha w/o. Rajesh) is sent by Income SMT SONU VS ITO, WARD - DAUSA tax department. This fact came into knowledge of Mr. Rajesh while checking his mobile message, then he immediately communicated to assessee and then assessee got checked IT Portal and only then it has come into knowledge for the first time on dt.06.05.2024 about passing of appeal order, then immediately appellant has deposited appeal fee of Rs. 10,000/- on dt. 15.05.2024 and then filed appeal on dt.29.05.2024 and thus it is delayed submitted by 122 days. That application for condonation of delay u/s.5 of Limitation Act is separately filed. The screen shot of mobile message as shared by Mr. Rajesh to appellant is enclosed and marked as Annexure-2. That looking to all these changed mechanism of faceless working and looking to appellant rural background, she was deprived for submission of all above documents before CIT (A), NFAC and which may please be considered and additional evidences may please be allowed to be submitted in the interest of equity and justice and oblige.
That the Hon'ble Tribunal has discretionary powers to entertain the additional evidence and for which it is humbly requested to kindly consider and allow additional evidence on record. That in support of our contention below judgements are being submitted. (i) That Hon'ble ITAT, Jaipur Bench in the case of Rajendra Pathak Vs. Asstt. DIT (2015-124-DTR-337) has held that "Whatever evidences filed along with the prayer go to the root of the cause, we consider that these documents are required to be filed and to be considered for disposal of this appeal" and thus additional evidences as filed by the appellant are allowed. (ii) That Hon'ble Delhi High Court in the case of CIT Vs. Text Hundred India Pvt. Ltd. (2013-351-ITR-page 57 - Delhi High Court). The Hon'ble Delhi High Court in para no. 10 has observed as under:-"We may in this connection referred to the scope of the powers of Tribunal under rule 29 of the Tribunal Rules. In R.S.S. Shanmugam Pilai and Sons Vs. CIT (1974-95 ITR-109). This Court had occasion to go into the question of SMT SONU VS ITO, WARD - DAUSA the powers of the Tribunal to entertain or reject of evidence, while accepting that the Tribunal has got a wide discretion to admit or reject documents at the stage of appeal, it was pointed out that such a discretion can not be exercised in an arbitrary manner, that if the Tribunal found that the document filed are quiet relevant for the purpose of deciding this issue arising before, it would be well within its powers to admit the evidence, consider the same or remit the matter to the lower authorities for such consideration." The Hon'ble Delhi High Court has referred and relied upon the various decisions of the difference High Courts and have also relied upon the decision of the Hon'ble decision of Supreme Court reported in K. Venkatramaiah Vs. A. Seetharam Reedy, AIR-1963- S.C.-1526. This judgment of the Hon'ble Supreme Court is placed by the Hon'ble Delhi High Court in their judgment in para 12. (iii) National Thermal Power Co. Ltd. Vs. Commrr. Of Income tax (1998-229-ITR-page 383) - Supreme Court That in the case it has been held by Hon'ble Supreme Court that "Undoubtedly, the Tribunal will have the discretion to allow or not a new ground to be raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee." (copy of above judgments are enclosed herewith) The humble appellant request to kindly allow the additional evidences in the interest of equity and justice & oblige.’’ 3.2 However, the ld. DR objected to such additional evidence raised by the ld.AR of the assessee.
SMT SONU VS ITO, WARD - DAUSA 3.3 The Bench has heard both the parties and perused the materials available on record. The additional evidence as raised by the ld. AR of the assessee has merit and it is in the safeguard of the interest of the assessee. Thus the additional evidences are admitted and allowed. 4.1 As regards the grounds of appeal of the assessee, the facts as emerges from the order of the ld. CIT(A) wherein the ld.CIT(A) has passed an ex-parte order by dismissing the appeal of the assessee. The narration as made in his order is reproduced as under:- ‘’6 In response to the notice u/s 250 of the I.T. Act, 1961, the appellant did not submit any replies. However, appeal is decided on merit.
7. During the course of appellate proceedings, the appellant assessee has taken as many as three grounds of appeal, however, the main grievance of the assessee is against the addition of Rs. 14,02,559/- made in the assessment order which are adjudicated hereunder:- 7.1 As per the facts emanated from the order of the AO that the this case was reopened u/s 148 after recording reason and obtaining necessary approval from the competent authority. During the course of assessment proceedings, the assessee was required to furnish the substantiating documentary evidence with regard to the source of investment made in the property. However, after availing considerable time and opportunities, the appellant assessee could not substantiate the source of investment and accordingly, the AO made the addition of Rs. 14,02,559/- under the head income from other sources. During the course of appellate proceedings, the appellant was provided sufficient opportunities to submit the details and documents in respect of grounds raised at appellate stage. However, the appellant did not bother to submit any details on the given date. Thus, it is amply clear that adequate opportunity was provided to the appellant to substantiate its source of investment. Considering the entirety of facts, circumstances and material on record, I am of the opinion that the appellant assessee has not furnished any documentary evidences to SMT SONU VS ITO, WARD - DAUSA controvert the findings made by the AO in the assessment order and accordingly, the addition made by the AO is upheld and grounds of appeal taken by the appellant are dismissed being devoid of any merits.
8. In the result the appeal is dismissed.’’ 4.2 After hearing both the parties and perusing the materials available on record, it is noted that the assessee has not filed any submissions and evidences relating to the case before the ld. CIT(A) and thus the ld.CIT(A) has no other alternative except to confirm the action of the AO being the assessee remained ex-parte before the AO. It is also noted that the ld. AR of the assessee prayed for one more chance to contest the case before the AO while as the ld. DR relied on the order of the ld. CIT(A). The Bench feels that one more chance may be given to the Assessee to contest the case before the AO for afresh adjudication and the assessee will submit the necessary documents / evidences / additional evidences concerning the above mentioned appeal. However, for lethargic and negligent action on the part of the assessee, a cost of Rs.2,000/- is imposed on the assessee and the same may be deposited in the Prime Minister Relief Fund and copy of the same shall be submitted to the AO for proof and thus the appeal of the assessee is restored to the file of the AO to decide it afresh by providing one more opportunity of hearing. Thus, the assessee will not seek any adjournment on frivolous ground and remain cooperative during the course of proceedings and the appeal of the assessee is allowed for statistical purposes.