CHANDRA PRAKASH GOPLANI,BENGALURU vs. ITO 2(1)(1), AGRA

This appeal in ITA No.166/Agr/2023filed by the assessee for the

assessment year 2012-13 has arisen from the appellate order dated

10.08.2022 [DIN & Order No. ITBA/NFAC/S/250/2022-

23/1044576936(1)], passed by learned Commissioner of Income-tax

(Appeals), NFAC, Delhi, which appeal in turn has arisen from the

reassessment order dated29.11.2019passed by Assessing Officer

u/s.144 r.w.s. 147 of the Income-tax Act, 1961.

ITA No.166/Agr/2023

filed with the Income Tax Appellate Tribunal, Agra Bench, Agra reads as

under :

“1- BECAUSE the proceedings initiated u/s 147 and the notice issued u/s 148 is invalid, wrong, illegal, arbitrary, against the law and facts of the case, without proper reason to believe and bad in law. 2- BECAUSE in any view, the proceedings initiated u/s 147 and the notice issued u/s 148 is without any jurisdiction and appellant denies his liability to be assessed in terms of so called Notice dated 30.03.2019 said to be issued u/s 148. 3- Because there was no valid reason assigned by the 'AO' in the purported 'reasons to believe' and the reasons recorded by the 'AO' are no Reasons in the eyes of law as the same do not show any application of mind on the part of the Assessing Officer and are based on conjectures, surmises and in bad faith as merely because money had been deposited in bank account could not be basis for initiating proceedings u/sec 148, as deposits in bank account need not necessarily be out of income. The proceedings so initiated were illegal, bad in law and without jurisdiction. 4- BECAUSE in any view the Assessing Officer has grossly erred in treating the cash deposited as undisclosed income of the appellant without considering the facts of the case and legal position the law.

5- BECAUSE in any view the Assessing Officer has grossly erred in presuming that no return of income was filed for the year under consideration without considering the facts of the case and legal position the law. 6- BECAUSE in any view the impugned addition and impugned assessment order passed u/s 144 is wrong, illegal, arbitrary, bad in law, unjustified. contrary to facts and further without allowing proper and adequate opportunity of hearing and without serving the notices as per law. 7- BECAUSE in any view the assessment order passed by A.O. ex- parte without issuing and serving any notice U/s 143(2) to the assessee is arbitrary, illegal and against the facts of the case. 8- BECAUSE in any view the addition of Rs. 31,31,360/- being the total cash deposited in Bank Account, considering it as unexplained income,

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ITA No.166/Agr/2023

is grossly arbitrary, wrong, unjust, illegal and against the law and facts of the case. 9- BECAUSE the appellant craves leave to add or alter, any or more ground or grounds of Appeal, at the time of hearing of Appeal.”

there is delay of 394 days in filing this appeal belatedly with ITAT, Agra

Bench, Agra beyond limitation period as prescribed u/s. 253(3) of the Act.

It is submitted that the assessee has filed application for condonation of

delay supported by affidavit of the assessee.The main bone of contention

of the assessee is that the assessee had shifted from Agra to Bangalore .

The assessee has duly stated the Bangalore address in Form No. 35

filed before the ld. CIT(Appeals), but the CIT(Appeals) did not send any

notice to the assessee’s Bangalore address during appellate

proceedings, and even in the appellate order passed by ld. CIT(Appeals),

the address of Agra is shown by ld CIT(A) in its appellate order. My

attention was drawn to the application for condonation of delay as well as

affidavit filed by the assessee, which are placed on record in file. It was

submitted that when the assessee was filing its return of income for the

assessment year 2023-24, the assessee came to know from the e-portal

of Income Tax Department that the appellate order had been passed by

ld. CIT(Appeals) dismissing the appeal of the assessee.Then immediate

steps were taken for filing the appeal before the Tribunal. It was 3 | P a g e

ITA No.166/Agr/2023

submitted that further delay has taken place keeping in view that the

assessee has shifted to Bangalore from Agra, and prayers were made to

condone the delay. It was further reiterated by learned counsel for the

assessee that notices issued by CIT(Appeals) were not received by the

assessee nor the appellate order passed by ld. CIT(A) was received by

the assessee.

3.2 Learned Sr. DR, on the other hand, submitted that the matter is left

to the discretion of the Bench so far as condonation of delay is

concerned.

record, I am of the considered view that the delay of 394 days in filing

this appeal belatedly by the assessee with ITAT beyond the time

prescribed u/s 253(3) needs to be condoned, as the assessee has

demonstrated reasonable and sufficient cause for delay in filing this

appeal belatedly with ITAT. The assessee has duly filed an application

praying for condonation of delay supported by an affidavit of the

appellant to bring on record the facts surrounding the delay in filing this

appeal belatedly beyond the time prescribed u/s 253(3) of the 1961 Act,

and the department could not controvert the same.The reasons 4 | P a g e

ITA No.166/Agr/2023

stipulated for aforesaid delay is shifting of the assessee from Agra to

Bangalore. I have observed that in Form No. 35 , the assessee has

mentioned Bangalore Address. The assessee has stated that he did not

received any notices from CIT(A) nor the appellate order passed by ld.

CIT(A) was received. The assessee has stated that emails received

were overlooked. The ld. CIT(A) has stated Agra Address of the

assessee in the appellate order passed by ld. CIT(A) and not the

Bangalore Address. The assessee has claimed that when he was filing

his return of income for assessment year 2023-24, he became aware of

the appellate order passed by ld. CIT(A). It is stated that no notice nor

appellate order passed by ld. CIT(A) was received by the assessee. For

Service of notices and orders etc. Section 282 and Rule 127 are relevant.

If the technicalities are pitted against advancement of substantial justice,

the courts will lean towards advancement of substantial justice unless

malafide on the part of the assessee is at writ large. I do not find any

malafide on the part of the assessee in filing this appeal belatedly as the

assessee is not likely to gain by filing this appeal belatedly. Reference is

drawn to the judgment and order of Hon’ble Punjab & Haryana High

Court in the case of Munjal BCU Centre of Innovation and

Enterpreneurship, Ludhiana v. CIT(E), Chandigarh (2024) LiveLaw

(PH)106(Case No. CWP-21028-2023(O&M),wherein it was held that 5 | P a g e

ITA No.166/Agr/2023

merely uploading of the communication (notice) in the Income Tax

department e-portal is not sufficient mode of communication keeping in

view principles of natural justice which are inherent in income tax

proceedings as also keeping in view provisions of Section 282 of the

1961 Act and Rule 127 of the 1962 Rules. Reference is also drawn to the

judgment and order of Hon’ble Supreme Court in the case of Collector of

Land Acquisition , Anantnag v. Mst. Katiji & Ors. 1987 AIR 1353.Under

thefacts and circumstances of the case, I condone the delay of 394 days

in filing this appeal belatedly by the assessee with ITAT beyond the time

prescribed u/s 253(3), and proceed to adjudicate the appeal on merits.

of AIR/NMS, reasons for reopening of the concluded assessment were

recorded by the AO and case of the assessee was reopened by invoking

provisions of Section 147. Notice u/s. 148 was issued by the Assessing

Officer to the assessee on 30.03.2019 after taking approval from the

competent authority, requiring the assessee to file return of income. In

response to notice issued by the AO u/s. 148, the assessee did not file

any return of income. Statutory notice u/s. 142(1) was issued on

25.07.2019, but the assessee did not make any compliance. Show cause

notice u/s. 144 was also issued by the Assessing Officer on 15.11.2019, 6 | P a g e

ITA No.166/Agr/2023

but no compliance was made by the assessee, which led to addition to

the tune of Rs.31,31,360/- to the income of the assessee on account of

cash deposits in the saving bank account maintained by assessee with

ICICI Bank, Sanjay Place, Agra, which was treated by the Assessing

Officer as an unexplained income of the assessee.The said

reassessment order was passed by the AO u/s 144 read with Section

147 of the 1961 Act. Thus , it was an ex-parte reassessment order

passed by the AO.

issued as many as four notices to the assessee, but there was no

compliance on the part of the assessee and the CIT(Appeals) dismissed

the appeal of the assessee ex-parte and the reassessment order passed

by the AO was confirmed. Thus, this was an ex-parte appellate order

passed by ld. CIT(A).

Counsel for the assessee has demonstrated that the orders passed by

both the authorities below were passed ex-parte in the absence of the

assessee. The assessee could not give response to the notices issued

by the authorities below as the same were not received by the assessee 7 | P a g e

ITA No.166/Agr/2023

as the assessee has shifted to Bangalore from Agra ,and even the

Bangalore address was duly given in Form-35, but no notice/appellate

order were received by the assessee at Bangalore address. It was further

submitted that email sent by ld. CIT(A) were overlooked by the assessee

due to technical reasons. Prayers were made to set aside the matter

back to the file of ld. CIT(A) as the ld. CIT(A) has dismissed the appeal of

the assessee ex-parte in limine without deciding the issues arising in the

appeal on merits. It was submitted that challenge to best judgment

reassessment order was made by the assessee before ld. CIT(A) both on

legal grounds as well on merits of the issues arising in the appeal, but the

same were not adjudicated by ld. CIT(A) and the appeal filed by the

assessee was dismissed ex-parte in limine without deciding on merits.

exparte order in limine without deciding the issues arising in appeal on

merits and the matter can be restored back to the file of CIT(Appeals) for

de novo adjudication.

record. I have observed that the case of the assessee was reopened by

the AO u/s. 147 of the Act based on AIR/NMS that there were cash 8 | P a g e

ITA No.166/Agr/2023

deposits to the tune of Rs. 31,31,360/- in the bank account maintained

by the assessee with ICICI Bank, Sanjay Place, Agra. The AO recorded

reasons for reopening of the concluded assessment,and after taking

approval of the competent authority , notice u/s. 148 was issued to the

assesseeby the AO asking the assessee to file return of income.

Assessee did not file any return of income in pursuance to notice u/s.

Act were issued by the Assessing Officer to the assessee, but no

response was received from the assessee, which led to addition to the

tune of Rs.31,31,360/- by the AO in the hands of the assessee as

income of the assessee being unexplained cash deposits in the saving

bank account of the assessee maintained with ICICI Bank, Sanjay Place,

Agra, by best judgment re-assessment order passed by the AO u/s 147

read with Section 144. Thus, the assessee did not participated in the re-

assessment proceedings.The ld. CIT(Appeals) also dismissed the appeal

of the assessee ex-parte in limine without deciding the issues arising in

the appeal on merits as there was no compliance by the assessee during

the appellate proceedings. Before me, it is demonstrated that the

assessee has shifted to Bangalore from Agra, and the assessee has not

received any notice from CIT(Appeals), which led to an ex-parte

appellate order passed by the CIT(Appeals). I have also observed that 9 | P a g e

ITA No.166/Agr/2023

the CIT(Appeals) has passed an ex-parte appellate order in limine

without deciding the issues arising in appeal on merits. I have observed

that the additions have been made during reassessment proceedings u/s

147 on account of unexplained cash deposits in the ICICI Bank, Sanjay

Place, Agra to the tune of Rs. 31,31,360/- which remained unexplained.

The assessee has stated in Form No. 35 filed before ld. CIT(A) in

statement of fact filed before ld. CIT(A) that the cash deposited in the

ICICI Bank were from the business receipts from the business of trading

of shoes and sandals. The assessee has also stated that the said

business receipts were duly added to the business receipts declared in

the return of income filed with the Revenue and has suffered taxation.

These plea and contentions of the assessee requires investigation of

facts and enquiry/verifications. Both the authorities below has passed an

ex-parte order in the absence of the assessee. Now, the assessee has

come forward and the ld. Counsel for the assessee submitted that all

details will be submitted to substantiate the contentions of the assessee.

The assessee has also raised both legal challenge to the invocation of

reassessment proceedings u/s 147 as well raising challenge to the

additions made on merits of the issue before ld. CIT(A), wherein as many

as 11 grounds of appeal were raised before ld. CIT(A). I have also

observed that the CIT(Appeals) has not made any enquiry during the 10 | P a g e

ITA No.166/Agr/2023

course of appellate proceedings and has dismissed the appeal on

account of non-compliance by the assessee to the notices issued by ld.

CIT(A). The ld. CIT(A) did not adjudicated the issues and grounds raised

before him on merits. The said appellate order is not in compliance with

the provisions of section 250(6) wherein the CIT(Appeals) is required to

state the points for determination, decision thereon and the reasons for

the same. I have observed that the ld. CIT(A) is required and obligated to

pass order in compliance with the provisions of section 250(6), as ld

CIT(A) is required to pass reasoned and speaking order on merits in

accordance with law. The appellate order passed by ld. CIT(A) is subject

to further appeal with ITAT u/s 253. The appellate order passed by ITAT

is subject to further appeal before Hon’ble High Court u/s 260A. The

judgment and order passed by Hon’ble High Court is also subject to

challenge before Hon’ble Supreme Court. Thus, the appellate order

passed by ld. CIT(A) is not a final order, as it is subject to challenge

before higher appellate authority. Thus, Reasons which weighed in the

minds of the adjudicating authority while adjudicating appeal on merits of

the issues are cardinal as the higher appellate authority can then

adjudicate appeal on the issues arising in appeal before them, based on

decision and reasoning of ld. CIT(A) in deciding the issues. If the ld.

CIT(A) simply dismiss the appeal merely because the assessee did not 11 | P a g e

ITA No.166/Agr/2023

comply with the notices issued by ld. CIT(A) in limine without adjudicating

issues arising in the appeal on merits, such order is not sustainable in

the eyes of law keeping in view provisions of Section 250(6), and also

higher appellate authorities will be deprived to see what weighed in the

mind of the ld. CIT(A) while adjudicating appeal as it will be an order

passed without reasoning on the issues on merits. The appellate order of

the CIT(A) is clearly in violation of section 250(6) of the Act and liable to

be set aside. Merely stating that the assessment order passed by AO is

upheld, and that the assessee has not submitted details/documents is

not sufficient. The ld. CIT(A) is not toothless as his powers are co-

terminus with the powers of the AO., which even includes power of

enhancement. It is equally true that the assessee also did not complied

with the notices issued by ld. CIT(A) and did not file the requisite

details/documents to support his contentions. Thus, the assessee is

equally responsible for its woes. Under these circumstances and fairness

to both the parties, in the interest of justice, the appellate order of CIT(A)

is set aside and the matter can go back to the file of ld. CIT(A) for fresh

adjudication of the appeal of the assessee on merit in accordance with

law after giving opportunities to both the parties. The assessee is also

directed to comply with directions of ld. CIT(A) , otherwise the ld. CIT(A)

shall be free to adjudicate on merits in accordance with law.I clarify that I 12 | P a g e

ITA No.166/Agr/2023

have not commented on the merits of the issues in the appeal. I order

accordingly.

purposes.

Order pronounced in the open court on 29.01.2025.

Sd/- (RAMIT KOCHAR) ACCOUNTANT MEMBER Dated: 29/01/2025 *aks/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra

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