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Facts
The assessee's appeal before the CIT(A) was decided ex-parte due to non-response to notices. The assessee's representative sought adjournments, which were reportedly not heeded, leading to an ex-parte order. The tribunal noted the assessee's failure to file written submissions.
Held
The Tribunal deprecated the assessee's nonchalant attitude but, in the interest of justice, granted another opportunity to present their case. The issues were restored to the CIT(A) for fresh adjudication, with specific instructions regarding cash deposits during demonetization.
Key Issues
Whether the CIT(A) erred in deciding the appeal ex-parte without providing adequate opportunity? Whether the additions made under section 69A are justified and whether the cash deposits were correctly treated?
Sections Cited
250, 69A, 234A, 234B, 234C
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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: CHANDRA POOJARI & SHRI NARENDRA KUMAR CHODHRY
This appeal at the instance of the assessee is directed against NFAC’s order dated 30.11.2023, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2017-18.
Assessee has raised the following grounds:
1. The order of the authorities below in so far as it is against the appellant is opposed to law, equity and weight of evidence, probabilities, facts and circumstances of the case.
2. The appellant denies herself liable to be assessed to a total income of Rs.29,79,580/- as against the income returned at 3,17,750/- for the impugned assessment year 2017-18 on the facts and circumstances of the case.
3. Grounds on principles of natural justice: The learned CIT(A) ought to have provided another opportunity of a. hearing in the interest of natural justice on the facts and circumstances of the case. The learned CIT(A) ought to have called for documents filed during b. the assessment proceedings and should have disposed the appeal on the merits of the matter on the facts and circumstances of the case. The learned assessing officer has passed the order of assessment c. without providing opportunity of hearing though it was specifically requested thereby vitiating the principles of natural justice on the facts and circumstances of the case. The learned assessing officer has passed the impugned order d. without issuing a show cause notice thereby the mandatory checks and balances to pass an order of assessment has not been complied with on the facts and circumstances of the appellant's case.
4. Grounds on Merits of the Matter: a. The learned assessing officer is not justified in making additions of Rs.26,61,830/- under section 69A of the Act on the facts and circumstances of the case. b. The teamed assessing officer has failed to appreciate that the cash deposits made during the relevant assessment year represents the sale proceeds of the appellant's business and that the provisions of section 69A finds no applicability as the nature and source of deposits stands explained under the facts and circumstances of the case. The learned assessing officer has failed to appreciate that during the c. relevant assessment year certain purchases and sales invoices were not recorded due to oversight by the tax practitioner as a result of which the financial statement did not depict the correct financial position and that the learned assessing officer ought to have considered the revised purchases, revised sales and the revised trading account before passing the impugned order of assessment. d. Without prejudice, the learned assessing officer has failed to telescope the income declared at the time of original assessment on the facts and circumstances of the case. 5. That it is a settled proposition of law that 'consent cannot confer jurisdiction'.
6. The appellant denies the liability to pay interest under section 234A, 2346 and 234C of the Act in view of the fact that there is no liability to additional tax as determined by the learned assessing officer. Without prejudice the rate, period and on what quantum the interest, has been levied are not in accordance with law and further are not discernable from the order and hente deserves to be cancelled on the facts and circumstances of the case.
7. The appellant craves leave to add, alter, delete or substitute any of the grounds urged above. 8. In view of the above and other grounds that may be urged at the time of the hearing of the appeal, the appellant prays that the appeal may be allowed and appropriate relief be granted in the interest of justice and equity.
Facts of the case are that appeal of the assessee before the CIT(A) has been decided ex-parte. The reason for deciding the appeal ex-parte was that assessee did not respond to the several notices issued from the Office of the CIT(A). The learned AR submitted that assessee had sought for adjournment for the notices issued from the Office of the CIT(A). However, the CIT(A) did not heed to the request of the assessee and passed ex-parte order. It was submitted that in the interest of justice and equity, one more opportunity may be provided to the assessee to represent his case before the CIT(A).
The learned Standing Counsel supported the orders of the AO and the CIT(A).
We have heard the rival submissions and perused the material on record. The Office of the CIT(A) had issued several notices directing the assessee to file written submissions. Since there was no written submission filed on the part of the assessee, the CIT(A) passed ex-parte order. We strongly deprecate the nonchalant attitude of the assessee in not filing the written submissions on time.
However, in the interest of justice and equity, we are of the view that assessee ought to be provided with one more opportunity to present his case and accordingly the issues are restored to the files of the CIT(A). The CIT(A) shall follow the necessary instruction in case of cash deposits of specified bank notes during the demonetization period. The assessee is directed to co-operate with the Revenue and shall not seek unnecessary adjournment.
In the result, appeal filed by the assessee is partly allowed for statistical purposes.