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Income Tax Appellate Tribunal, “A”, BENCH MUMBAI
Before: SHRI R.C.SHARMA, AM & SHRI RAM LAL NEGI, JM
आदेश / O R D E R PER R.C.SHARMA (A.M): S.A.No.421/Mum/2016 This stay application is filed by the assessee in respect of Tribunal on 14th December 2016 for the assessment year 2007-08.
This is an appeal filed by the assessee against the order of CIT(A) for the assessment year 2007-08 in the matter of ex-parte order passed u/s.144 of the IT Act. 2. The following grounds have been taken by the assessee.
Mrs.Anjna Rajeev Sahi Ground No.1: Condonation of Delay 1. On the facts and in the circumstances of the case and in law, the ClT(A) erred in not condoning delay of 1400 days in filing appeal before him.
2. The CIT(A) failed to appreciate and ought to have held that: (a) The Appellant was unaware of any such notices issued by the AO and best judgement order passed by the AO u/s. 144 of the Act. (b) Following the Principle of natural justice, the said delay in filing the appeal should be condoned.
3. The Appellant therefore, prays that the CIT(A) be directed to condone the delay in filing the appeal before him. Without prejudice to Ground No.1 Ground No.2: Addition of Rs.42,36,000/- u/s. 69 of the Act on account of unexplained investment.
On the facts and in the circumstances of the case and in law, the ClT (A) erred in confirming the action of the AO of the addition of Rs. 42,36,000/- u/s. 69 of the Act on account of unexplained investment.
The ClT(A) failed to appreciate and ought to have held that: (a) The Appellant should be given sufficient opportunity for explaining the source of the said investment. (b) The Appellant had specifically taken housing loan from HSBC Bank for the purpose of purchasing the flat in the joint ownership with her husband, Mr. Rajeev Sahi.
The Appellant therefore, prays that the addition amounting to Rs. 42,36,000/- u/s. 69 of the Act on account of unexplained investment be deleted. Without prejudice to Ground No.1 Ground No.3: Levy of Interest u/s. 234B of the Act:
1. 1. On the facts and circumstance of the case and in law, CIT(A) erred in confirming the action of the AO in charging interest u/s. 234B of the Act.
2. The Appellant prays that the levy of interest u/s. 234B of the Act be deleted.
Ground No. 4: General The Appellant craves leaves to add to, alter, amend and I or delete the above grounds of appeal.
3. In this appeal, assessee is aggrieved for the ex-parte order passed by AO u/s.144 as well as by the action of CIT(A) for not condoning the delay in filing the appeal and not deciding the issue on merits.
4. Rival contentions have been heard and record perused. 5. Facts in brief are that the assessee is serving as a Teacher with a private School Villa Theresa High School, 66. Dr.G. Deshmukh Marg, Murnbai 400 026) and her yearly Gross Salary was Rs.1,30,364/-. She filed her IT Return on 13-08-2007, which is well in time. Her Husband is also serving in private industry (Reliance Industries Ltd.) at a good post with a yearly Gross Salary of Rs.68,90,795/- as per the I.T. Return filed on Dt. 31-07-2007. The case of the assessee was selected for scrutiny and notice u/s.142(1) was issued and sent by speed post. However, the ITO-15(1)(1) has served the Notice at old Address but since they left the said residence, the assessee did not get any notices. Subsequently the said ITO passed the order u/s 144 of the IT Act. 1960 on Dt. 11-12-2009, alongwith Penalty and Demand Notice. The same also was not received by the assessee since all the notice and Ex- parte order was posted at Old Residence Address. The assessee has not received any notices and the Ex-parte Assessment Order u/s 144 for A.Y. 2007-2008. Dt: 11/12/2009 with an estimated income of Rs. 42,36,000/- as unexplained investment.
Mrs.Anjna Rajeev Sahi 6. As the assessee was not in respect of any assessment order passed by the AO u/s.144, appeal could not be filed with the CIT(A) within the stipulated time. However, a petition for condonation of delay was also filed before the CIT(A), which was dismissed by the CIT(A) on the plea that there was no reasonable cause for delay. Accordingly, assessee is in further appeal before us.
We have considered rival contentions and found that during the year under consideration, assessee was staying with her husband at 41, Monalisa, 10, Bombajee petit Road. Mumbai 400 026. This house was allotted to her Husband from his company as a part of his employment. As required by the employment of her Husband, they have to move their Residence as per instruction of her husband’s company from time to time. Subsequently in next year, her Husband changed the job, hence they have to vacate the said flat and shifted to their Navi Mumbai place. But the said flat was far away from the work place, they planned earlier to purchase a flat with the help of Bank Ioan in Central Mumbai i.e. Parel having a Address, at Flat No. 2806, 28th Floor, Ashok Tower, D-Wing, Dr. Babasaheb Arnbedkar Road, Parel, Mumbai 400 012. As notice for hearing was not served on assessee, AO passed order u/s.144.
In the Ex-parte assessment order u/s.144, the AO has added 50% of the cost of the flat as assessee’s contribution and the same was added as unexplained. We found that assessee has availed a housing loan for purchase of this house from HSBC Bank which has sanctioned housing loan of Rs.75,70,000/-. We also found that initial payment, including Rs.8,98,000/- Mrs.Anjna Rajeev Sahi was paid by them from her husband’s salary. They jointly paid the Bank Instalment out of their salary.
There is no dispute to the fact that notice issued by the AO u/s.143(2) dated 06/08/2008 at her old residence addressed at 41, Monalisa, 10, Bombajee petit Road. Mumbai 400 026 remain undelivered. Subsequent to notice u/s.143(2) of the Act, notices u/s.142(1) of the Act dated October 26,2009 and October 30,2009 were issued to the Assessee but remained undelivered. The non-delivery of notice was due to change of address. Since, the assessee was unaware of any such notices issued by the AO and best judgement order was passed by the Ld. AO. However, the assessee has come to know about the fact for the first time that the assessment proceedings had been concluded in her case when the assessee received notice dated October 15, 2013 for recovery of outstanding arrears issued by the Tax recovery officer 15(1), Mumbai ("the Ld. TRO") at her new residence address. We found that the assessee had filed an appeal before the Ld. CIT(A) contesting the order passed by the Ld. AO on December 12,2013 i.e. within 30 days from the date on which the assessee obtained the assessment order on November 9, 2013 after the assessee received notice dated October 15,2013 issued by the Ld. TRO. Since appeal could not be filed within 30 days of date of Assessment order, the CIT(A) vide order dated 29/09/2016 has taken a view that there was a delay in filing appeal. He did not consider the reasons for delay and dismissed the appeal without considering the same on merits. As per provisions of Section 250 Sub- Section 6, the order of the CIT(A) should be in writing and should state the points for determination, the decision thereon and the reasons for the