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Facts
The assessee deposited cash during demonetization but did not file a return of income. The AO issued a notice under Section 142(1) for filing the return, to which the assessee did not comply. Consequently, the AO passed an order under Section 144 assessing total income at Rs. 27,02,681/-. The assessee appealed before the CIT(A), who issued multiple notices that were not responded to, leading to an ex-parte dismissal of the appeal.
Held
The Tribunal noted that both the AO and CIT(A) passed ex-parte orders due to the assessee's non-compliance. The authorized representative argued that the assessee is an elderly lady not conversant with tax proceedings and requested another opportunity. The Tribunal, considering principles of natural justice, decided to provide one more opportunity to the assessee.
Key Issues
Whether the assessee should be granted another opportunity to present her case before the AO, despite previous non-compliance, in the interest of natural justice.
Sections Cited
144, 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI
Before: SHRI GEORGE GEORGE K & SHRI JAGADISH
आदेश / O R D E R
PER JAGADISH, A.M : Aforesaid appeal filed by the assessee for Assessment Year (AY) 2017-18 arises out of the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] dated 22.08.2024 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s. 144 of the Income-tax Act, 1961 (hereinafter “the Act”) dated 06.12.2019.
The assessee has deposited cash during demonetization period, and has not filed return of income. The A.O has issued notice u/s. 142(1) of the Act for filing return, but the assessee has not complied for the same. The A.O therefore proceeded to pass order u/s. 144 assessing total income of Rs. 27,02,681/-. Aggrieved, the assessee preferred an appeal before Ld. CIT(A). The Ld. CIT(A) has issued five notices to the assessee from 01.11.2023 to 08.08.2024, but the assessee did not respond to the notices. Therefore, the Ld. CIT(A) has dismissed the appeal ex-parte.
The Ld. Authorized Representative (A.R) of the assessee before us has argued that the assessee is an old lady and not conversant with the income tax proceedings and the AR whose email was given has not informed about the notices. The Ld AR has prayed that one more opportunity may be given to substantiate her case in the interests of justice.
We have heard the rival submissions, and perused the materials available on record.
We have heard the rival submissions, and perused the materials available on record. On perusal of the orders of A.O as well as Ld.
CIT(A), we find that both the orders have been passed ex-parte for the non-compliance by the assessee. The Ld. A.R has submitted that the Ld. CIT(A) has not decided the issue on merits, therefore the case may be remanded back to the A.O for adjudication on merits. We are of the opinion that keeping in view the principles of natural justice, the assessee be provided with one more opportunity to substantiate her case before the A.O subject to payment of costs of Rs.10,000/-. The same shall be paid by the assessee to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras within a period of one month from the date of receipt of this order and produce the receipt before the A.O. Accordingly, we set aside the orders passed by the lower authorities and remit the matter back to the file of the A.O to adjudicate this appeal afresh in accordance with law, after giving reasonable opportunity to the assessee. We also direct the assessee to appear before the A.O on the date of hearing without fail and furnish complete details for her fresh consideration. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on 20th December, 2024.