SH. DEVENDRA SONI,ALWAR vs. ITO, WARD-2(1), ALWAR, ALWAR
Facts
The assessee's appeals were filed against the orders of the CIT(A). The AO passed ex-parte assessment orders u/s 144/147, making additions for unexplained cash deposits. The assessee contended that notices were not served properly and hence the assessment was made ex-parte without addressing the merits.
Held
The Tribunal noted that the AO and CIT(A) did not address the merits of the case and the assessee was not given adequate opportunity to be heard. Citing principles of natural justice and a Supreme Court judgment, the Tribunal decided to restore the matter.
Key Issues
Whether the ex-parte assessment order and CIT(A) order are sustainable when the assessee was not afforded proper opportunity of hearing and the merits were not addressed.
Sections Cited
144, 147, 69, 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES, “SMC” JAIPUR
Before: SH. SANDEP GOSAIN & DR. M. L. MEENA
Per Dr. M. L. Meena, AM:
These appeals have been filed by the assessee against the orders of the ld. CIT(A) National Faceless Appeal Centre (NFAC), Delhi dated 01.12.2023 & 27.12.2023 in respect of Assessment Years: 2011-12 & 2012-13.
2 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO 2. At the outset, the Ld. Counsel for the appellant submitted that the AO
has passed the assessment order exparte qua the assessee u/s. 144/147
of the act against the law in the facts circumstances of the case and notice
issued u/s. 148 is illegal by making addition of Rs.24,46,400.00 u/s.69 of
the Act as unexplained cash deposit in bank against the law and facts of
the case in two quantum matters and one consequential penalty. He further
submitted that the Ld. CIT (A) confirmed the addition even during the
course of appellate proceedings by observing that the assessee failed to
file any explanation to its unexplained income or any documentary
evidence in support of his claim and also failed to rebut the findings of the
AO regarding addition of 24,46,400/- under the head 'Income from Other
Sources' as unexplained income u/s 69 of the I.T. Act which leads to pass
the assessment order u/s. 144 of the I.T. Act. Under such circumstances, in
the absence of any explanations, details or documentary evidence
forthcoming from the appellant, I am of the considered opinion that the AO
rightly made the impugned addition of Rs.24,46,400/- to the Total Income
under the head 'Income from Other Sources as unexplained investment
and hence no interference of the appellate authority is warranted in this
case. The action of the AO is upheld and the ground is dismissed.
3 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO 3. The Ld. AR contended that the notices were sent by the AO at the old
address of Govind colony, Braham Puri, Jaipur and therefore, these notices
could not be served upon the assessee to his knowledge. The AO seized
the bank account for recovery of Tax demand, so the assesse came to know about the assessment order from the bank and filed its appeal
belatedly before the CIT appeal. The AR further submitted that the CIT(A)
issued notices at email address dvndrsn303@gmail.com and not at the
communicable address provided in serial no 17 of Form 35 where email
address and phone number of the Assesse are provided. Therefore, the
appellant failed to attend before the learned CIT appeal in compliance to the said notices. The learned council requested that in view of principles of
natural justice, the matter may be sent back to the assessing officer to pass
De Novo assessment as the assasse undertake to present his case before
the assessing officer with detailed submissions to explain it's source of
cash deposit in it's bank account.
Per Contra, the learned additional CIT (DR) has no objection to the
request of the council of the assesse.
Heard rival contentions, perused the material on record, impugned
order, written submission and case law cited before us. Admittedly, the
4 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO revenue authorities have passed orders ex parte qua the assesse. The Ld.
AR argued that the worthy CIT(A) decided the case exparte without valid
service of notice the address human in column 17 of form no. 35 against
the ex parte assessment order passed under section 144/147 of the act and that while deciding the case ex-parte, the Ld. CIT(A) has not
appreciated the facts of the case and arbitrary confirmed the assessment
order passed u/s 144 r.w.s. 147 of the I.T. Act. It is seen that neither the
AO nor the Ld. CIT(A) has addressed the relevant issue on merits of the
case. It is seen that neither the AO nor the Ld. CIT(A) has addressed the
relevant matter regarding appellants’ claim of source of cash deposit in its bank account. He requested that in view of principles of natural justice, the
matter may be sent back to the assessing officer to pass De Novo
assessment as the assasse undertake to present his case before the
assessing officer with detailed submissions to explain it's source of cash
deposit in it's bank account for that the learned additional CIT (DR) has no
objection.
The Hon’ble Supreme Court of India in the case of Tin Box Company
vs. CIT reported in 249 ITR 216 has observed as under:
“Assessment - Opportunity of being heard - Setting aside of assessment - Assessment order must be made after the assessee
5 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO has been given reasonable opportunity of setting out his case - Same not done - Fact that the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is assessment order that counts — Assessment order set aside and matter remanded to assessing authority for fresh consideration.”
In the present case, the assessee could have placed evidences either
before the AO or the first appellate authority, if he has been provided
adequate opportunity of being heard. In view of the principles of natural
justice, we consider it deem fit to restore back the matter to the file of the
Ld. AO to pass de novo assessment after considering the written
submission and evidences filed on record and may be filed during the fresh
Assessment Proceedings. The AO is directed to grantg sufficient
opportunity of being heard to the assesse and that the AO shall issue a
Show Cause Notice, and thereafter pass a reasoned order in accordance
with law.
Accordingly, Assessment order set aside and matter remanded to
assessing authority to pass de novo assessment as per law.
6 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO 10. In the result, the appeal filed by the assessee in I.T.A. Nos. 79 to
81/JPR/2024 are allowed for statistical purposes.
Order pronounced in open court as on 10.04.2024
Sd/- Sd/- (Sandeep Gosain) (Dr. M. L. Meena) Judicial Member Accountant Member *DOC* Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The ld. CIT (4) The ld. CIT(A) (5) The DR, I.T.A.T., Jaipur (6) Guard File By Order, Asstt. Registrar
7 ITA Nos. 79 to 81/JPR/2024 Devendra Soni v. ITO
Date Initial 1. Draft dictated on DOC 2. Draft placed before author 3. Draft proposed & placed before the 08.04.24 JM/AM Second Member 4. Draft discussed/approved by JM/AM Second Member 5. Approved Draft comes to the Sr. Sr.PS/PS P.S./P.S. 6. Kept for pronouncement on Sr.PS/PS 7. File sent to the Bench Clerk Sr.PS/PS 8. Date on which file goes to the Head Clerk 9. Date on which file goes to the AR 10. Date of dispatch of Order
