ELUMALAI RAJENDRAN,CHENNAI vs. NATIONAL FACELESS ASSESSMENT CENTRE, NEW DELHI
Facts
The assessee failed to file an Income Tax return for AY 2013-14, leading to a reassessment under Section 147 r.w.s. 144. Despite notices, the assessee did not file the return. Subsequently, the Assessing Officer made additions based on various financial transactions. The CIT(A) upheld the AO's order after the assessee failed to appear.
Held
The Tribunal noted the Covid-19 pandemic and the possibility that the assessee could not effectively present their case. The Tribunal set aside the impugned order and restored the assessment to the AO for de novo adjudication, providing a proper opportunity for hearing.
Key Issues
Whether the assessment order passed ex-parte without affording sufficient opportunity to the assessee is sustainable, especially considering the pandemic period.
Sections Cited
147, 144, 144B, 148
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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM & HON’BLE SHRI MANU KUMAR GIRI, JM
आयकर अपीलीय अिधकरण ‘ए’’ �ायपीठ चे�ई म�। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI माननीय �ी मनोज कुमार अ�वाल ,लेखा सद� एवं माननीय �ी मनु कुमार िग�र, �ाियक सद� के सम�। BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI MANU KUMAR GIRI, JM आयकरअपील सं./ ITA No.1587/Chny/2024 (िनधा�रणवष� / Assessment Year: 2013-2014) Elumalai Rajendran, Vs. The Deputy Commissioner of 1/183, Sri Selva Vinayagar Nagar, Income Tax, Payasampakkam Village, Corporate Circle 1(1) Near Jeeva Jyothi Illam, Chennai. Red Hills, Chennai 600 052. [PAN: AACPR 5915K] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri. V. Veerabathram Prasanth, Advocate ��यथ� क� ओर से /Respondent by : Shri Nilay Baram Som, IRS. CIT. सुनवाई क� तार�ख/Date of Hearing : 29.08.2024 घोषणा क� तार�ख /Date of Pronouncement : 29.08.2024 आदेश / O R D E R PER MANU KUMAR GIRI (Judicial Member) This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in order No.ITBA/NFAC/S/250/2023-24/1063441302 (1) dated 27.03.2024. The assessment was framed by the Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income-tax Officer, National Faceless Assessment Centre (NFAC), Delhi, u/s.147
2 ITA No.1587/Chny/2024 r.w.s. 144 of the Income Tax Act, 1961 (hereinafter the ‘Act’) for the assessment year 2013-14 vide order dated 25.03.2022.
Brief facts of the case are as under:- The assessee has not filed the return of Income for AY 2013-14. Subsequently, on the basis of ITS data and MNS data, the case was reopened. Notice u/s 148 of the Income Tax Act, 1961 (‘ACT’ in short) was issued on 30.03.2021 for the year under appeal. The assessee has not filed the return of income despite notice served. Although during assessment proceedings in response to notices dated 11.01.2022 and 18.01.2022 has furnished the copy of computation of total income, copy of audit report, copy of personal accounts, copy of challans for advance tax and self assessment tax. The AO passed assessment order dated 25.03.2022 ex-parte u/s 147 r.w.s.144 read with section 144B of the Act and made following additions: Cash deposit ………………………Rs.5,01,95,500/- Payment for credit card………….. Rs.20,74,290/- Purchase of Mutual fund ………….Rs.1,20,37,525/- Long Term Capital Gain ……………Rs.14,92,96,000/- Aggrieved with the assessment order dated 25.03.2022, appeal has been filed before the ld.CIT(A). The ld.CIT(A) has given several notices of hearing to assessee but assessee failed to appear before him. Hence, the Ld.CIT(A) upheld the order of the ld.AO on merits of addition. Now the assesse is in further appeal before us.
3 ITA No.1587/Chny/2024 3. Before us, the ld.Counsel submitted as under:- The ld.Counsel Mr. M. Veerabhatharan Prasanth, Advocate for the assessee filed affidavit of the assessee wherein assessee has given before us following undertaking:- ‘2. I submit that, due to my age I was unable to produce the documents to substantiate my case in the assessment proceedings before the Assessing Officer as well as in the appellate proceedings. I hereby submit that I undertake to file the following documents to substantiate my case before the Authority:- a. Bank Statements for the purpose of the cash deposits b. Payment of credit card made by the Companies in which I am director. c. Mutual fund Statements d. Encumbrance Certificate to the effect that I have not sold the property during that assessment year. 3. I, hereby undertake to provide & extent full cooperation with the Income tax department to complete the Assessment at the earliest adhering to the time schedule, if the file/ records are revert back to the Jurisdictional Assessing officer/NFAC. Further I undertake to pay the cost of Rs. 15,000/- as directed by this Hon'ble Tribunal’’. Ld. Counsel for the appellant further prayed that if an adequate opportunity of hearing is given before ld.AO from grass root, assessee will prosecute the case properly.
Per contra, the ld.DR-JCIT relied upon the orders of the lower authorities and prayed for the dismissal of the appeals filed by the assessee.
We have heard the rival submissions and perused the records of the appeal file, undertaking in the form of affidavit filed by the ld.Counsel for the assessee, orders of the lower authorities. We find that during assessment proceedings there was Covid-19 pandemic and there is every possibility that assessee might not was
4 ITA No.1587/Chny/2024 able to substantiate his case effectively. Even the assessee was not aware of the notices of the appellate proceedings. Accordingly, in the interest of justice the impugned order is set aside and the assessment is restored back to the file of Ld. A.O. for de novo adjudication after affording proper opportunity of hearing to the assessee subject to cost of Rs.15000/- 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. A.O. whose shall proceed for de novo assessment. The assessee is directed to file cogent evidence, if any, to substantiate his case forthwith without any fail, failing which Ld. A.O. shall be at liberty to proceed with the de novo assessment on merits. 5. In the result, appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 29th day of August, 2024 at Chennai. Sd/- Sd/- (मनोज कुमार अ�वाल) (मनु कुमार िग�र) (MANOJ KUMAR AGGARWAL) (MANU KUMAR GIRI) लेखा सद� / ACCOUNTANT MEMBER �ाियक सद� / JUDICIAL MEMBER चे�ई Chennai: िदनांक Dated : 28-08-2024 KV आदेश क� ��त�ल�प अ�े�षत /Copy to : 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT, Chennai/Coimbatore/Madurai/Salem. 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF
