Loading judgment…
Facts
The assessee, a public charitable trust, made substantial cash deposits in its bank accounts during the financial year 2014-2015. The Assessing Officer (AO) added the unexplained cash deposits to the assessee's income under Section 69A of the Act and also made an addition under Section 194A. The CIT(A) dismissed the assessee's appeal due to its belated filing.
Held
The Tribunal, while acknowledging the assessee's failure to represent before the CIT(A) and the validity of the revenue's arguments, set aside the impugned order. This was done to provide another opportunity for hearing in the interest of natural justice, with a cost imposed on the assessee.
Key Issues
Whether the assessee was denied an opportunity to present its case due to non-receipt of notices, and whether a denovo assessment should be granted on payment of costs.
Sections Cited
147, 144, 144B, 69A, 194A, 249(3), 250, 133(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘D’ BENCH, CHENNAI
Before: HON’BLE SHRI MANU KUMAR GIRI
(िनधा�रणवष� / Assessment Year: 2015-2016) Ceronet Educational Foundation Vs. The Assistant Commissioner of 1B1, Azad Street Near Kalpanan Income Tax, Theatre, Exemption2, Udumalpet 642 126. Trichy. [PAN: AABTC 2938E] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri. N.V. Narayanan, Advocate ��यथ� क� ओर से /Respondent by : Ms. V. Aswathy, IRS, JCIT सुनवाई क� तार�ख/Date of Hearing : 18.12.2024 घोषणा क� तार�ख /Date of Pronouncement : 20.12.2024 आदेश / O R D E R MANU KUMAR GIRI (Judicial Member) This appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax(Appeals)(NFAC) Delhi [CIT(A)] dated 28.08.2024 for Assessment Year 2015-16.
Brief facts of the case are that the order was framed u/s.147 r.w.144 of the Act. The assessee is a public charitable trust with a main object of imparting education irrespective caste, creed and religion which is the sole one and only object of the trust. As per the information available with the Income Tax Department the assessee has made financial transactions during the financial year 2014-2015 relevant to assessment year 2015-2016 and the same is as under:- ‘’Cash Deposit in IDBI Bank Limited Rs.1,26,94,628/-.’’ During the course of scrutiny proceedings, based on information available with the department, it is noticed that the assessee has maintained account with IDBI BANK bearing A/c No. 1244104000001571, Azad Street, Udumalpet, Tirupur Branch. Further, on verification of ITR, it was also noticed that the assessee has maintained HDFC Bank account bearing No. 18497620000037. Accordingly, necessary information was called for by issue of notices u/s 133(6) of the Act from the concerned Bank Authorities by the FAU as well as Verification Unit.. On perusal of copy of Bank account statements as provided by concerned bank authority as well DVU, it was noticed that during the year under consideration, the assessee had maintained current account with Azad Street, Udumalpet, Tirupur Branch. of IDBI BANK bearing A/c no 1244104000001571 and HDFC Bank account bearing No. 18497620000037. The assessee had made substantial cash deposits of Rs. 1.27,24,758/- and other credits of Rs.34,71,833/- into IDBI BANK and cash deposits of Rs.22,95,953/- and other credits of Rs.1,34,92,440/- into HDFC Bank. However, the assessee has not submitted any justification regarding source of above said cash deposits with IDBI BANK A/c and HDFC bank A/c of the assessee. Hence, the AO passed an assessment order u/s 147 r.w.s. 144 read with section 144B of the Act making an addition of Rs.3,19,54,854/- u/s 69A and Rs.68,505/- u/s 194A of the Act. Assessee further challenged the order of assessment u/s 147 r.w.s. 144 read with section 144B of the Act before the ld.CIT(A) who on account of the belated
Before us, the ld. Counsel for assessee submitted that the assessee has inadvertently not received the notices issued by the AO hence, asessee failed to avail opportunity to file evidence and documents to substantiate his explanation regarding deposits. The ld.DR stated that the assessee is habitual defaulter in appearing before the appellate authority hence no lenient view is to be taken in this case and prayed for dismissal of appeal.
Though we concur with the submissions of Ld. Sr. DR however, keeping in mind the principle of natural justice and grant another opportunity of hearing to the assessee. We also find that assessee has not represented before the ld.CIT(A) despite notices. Accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. AO for denovo assessment subject to cost of Rs.5000/- which shall be deposited by the assessee within 30 days from the date of receipt of this order to ‘Tamil Nadu State Legal Services Authority’ at Hon’ble High Court of Madras. The proof of the same will be furnished by the Assessee before Ld.AO whose shall proceed for denovo assessment after affording proper opportunity of hearing to the assessee. The assessee is directed to substantiate its case with all evidence, confirmations and documents, if any, forthwith without any fail, failing which Ld. AO shall be at liberty to proceed with the assessment proceedings on merits as per law.
In the result, appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 20th day of December, 2024 at Chennai.