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Facts
The assessee filed a return for AY 2017-18 declaring income and foreign investments. The AO made additions for unexplained investments, which were confirmed by the NFAC after the assessee failed to provide details. The assessee claims the investments were from ESOPs and salary, and the lack of documentation was due to a mistake and unfamiliarity with the assessment process.
Held
The Tribunal noted that both the assessment order and the NFAC order were ex-parte due to the assessee's non-cooperation. Consequently, the entire issue in dispute was remitted to the file of the AO for fresh consideration, with a direction for the assessee to provide necessary details to support the investment claims.
Key Issues
Whether the addition of Rs. 89,21,446 as unexplained investment was justified, and if the assessee should be given an opportunity to furnish details of the investment source.
Sections Cited
69 of the Income Tax Act, 1961, 144 of the Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A’’ BENCH: BANGALORE
Before: SHRI GEORGE GEORGE K. & SHRI CHANDRA POOJARI
Assessment Year: 2017-18 Pramod Rao Flat 414, Daisy Block Vijayasri Exixir Borewell Road, Whitefield ACIT Vs. Bangalore 560 066 Circle-5(3)(1) Karnataka Bangalore PAN NO.AOQPR0414P ASSESSEE RESPONDENT Assessee by : N O N E Revenue by : Dr. Nischal, D.R. Date of Hearing : 20.02.2024 Date of Pronouncement : 20.02.2024 O R D E R
PER CHANDRA POOJARI, ACCOUNTANT MEMBER:
This appeal by assessee is directed against order of NFAC for the assessment year 2017-18 dated 6.10.2023. The assessee has raised following grounds of appeal:
a) The appellant was an employee of Qualcomm India Private Limited and he had accumulated investment in foreign assets by way of ESOP shares issued by Qualcomm for various years which he had declared wrongly in AY 2016-17 while filing the return of Income for the AY 2016-17. The mistake of AY 2016-17 which he had rectified by declaring the correct investment in foreign assets during the AY 2017-18 while filing the return of Income for the AY 2017-18. b) The appellant has filed income tax returns vide Acknowledgment number 160686990080817 dated 08/08/2017 declaring income of Rs.88,32,031 and declaring investments in foreign investments of Rs. 1,11,04,692. The source of investment is from the salary and Employee stock option plan (on ESOPs company has deducted TDS and Appellant has also offered the income). The assessment in case of the Pramod Rao, Bangalore Page 2 of 4 appellant was completed by the Income Tax Officer ward 5(3)(1) Bangalore. Where in the assessment of the appellant was completed considering investment of Rs.89,21,446 /- (increase in investment) made additions as unexplained investments. Aggrieved by the order of A.O. the appellant preferred an Appeal with CIT (A), Cricle 5(3)(1) Bangalore. Due to non-submission of details for appeals, CIT(Appeals) dismissed the Appeal. c) The appellant is in possession of all the details of ESOP allotment in various years which he had declared in AY 2017-18 and attaching the details for the investment and its reconciliation. d) Further, Details of the investment in AY 2017-18 is as below. e) The appellant pleads to the Honourable Tribunal that and he is having all the details and source for the investment which he has declared and it is his lack of knowledge and non awareness of the new procedures of faceless assessment which he could not present the details and it is not an unexplained income factually. f) Hence, the appellant pleads and accepts that due to his mistake as stated above, could not provide the details of investment during the assessment and appeals with Commissioners Appeals. However, The appellant pleads for one more opportunity of being heard based on the merits of the case and details which he is providing now for the source of investments and hearing will save the appellant from injustice of paying the taxes for already declared Income by way of part of Salary Income. g) The appellant pleads for one more opportunity of being heard on the merit of the case and set aside the Order of Commissioner Appeals and Assessment Order for V the AY 2017-18. h) The Appellant crave leave to add to, amend, alter or modify any of the grounds of this Appeal. i) The Appellant request that they may be granted the opportunity of a personal hearing before any decision or order is passed in this Appeal. j) The Appellant also reserve their right to adduce further evidence, write-ups, etc, at the time of the personal hearing.
Pramod Rao, Bangalore Page 3 of 4
None appeared for the assessee inspite of giving notice of hearing fixing the case on 20.2.2024 vide notice dated 20.1.2024. Hence, we proceed to dispose of the appeal after hearing ld. D.R.
Facts of the issue are that the assessee has filed return of income for the AY 2017-18 declaring income of Rs.88,32,031/-. The case was subject matter of scrutiny. There was no cooperation by assessee before ld. AO. Hence, the ld. AO has passed the ex-parte order u/s 144 of the Act determining the income at Rs.1,77,53,477/- after making an addition of Rs.89,21,446/- as unexplained investment u/s 69 of the Income Tax Act, 1961 (in short “The Act”). Against this assessee went in appeal before NFAC. NFAC has given various dates to file submission before it. However, there was no response from the assessee. Hence, the NFAC has confirmed the order of the ld. AO. Against this assessee is in appeal before us. Before us also, no representation from the assessee’s side. Since both the orders of the lower authorities are ex-parte, we remit the entire issue in dispute to the file of ld. AO with a direction to assessee to cooperate with the department by furnishing necessary details in support of it’s claim explaining the source of investment of Rs.89,21,446/-. Accordingly, the issue in dispute is remitted to the file of ld. AO for de-novo consideration. 3. In the result, appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the open court on 20th Feb, 2024
Sd/- Sd/- (George George K.) (Chandra Poojari) Vice President Accountant Member Bangalore, Dated 20th Feb, 2024. VG/SPS
Pramod Rao, Bangalore Page 4 of 4