JAINULLABDEEN HAJA NAJUMUDEEN,TRICHY vs. DCIT CIRCLE 1(1), TRICHY

Assessee is an individual and filed his return of income for AY 2017-18 on 20.12.2017 declaring the total income of Rs.7,25,320/-. The case was selected for limited scrutiny due to large cash deposits during the demonetization period. The appellant deposited cash of rs.66,50,000/- during the demonetization period which was treated as unexplained money u/s 69 of the Income Tax Act, 1961 (‘Act’ in short) while framing assessment u/s 143(3) dated 30.12.2019. Being aggrieved assessee challenged the said order u/s 143(3) of the Income Tax Act, 1961 before the ld.CIT(A) wherein the assessee has not given proper chance to substantiate and prosecute the appeal hence, the ld.CIT(A) dismissed the appeal ex-parte on merits.

At the outset, Ld.AR for the appellant submitted that Ld. CIT(A) had not properly followed the principles of natural justice. Ld. Counsel for the appellant further prayed that if an adequate opportunity of hearing is given before ld.CIT(A), assessee will substantiate and prosecute the appeal properly. Ld.JCIT-DR relied upon order of ld.CIT(A) and prayed for dismissal of appeal.

We have gone through the orders of lower authorities and submissions addressed by the parties before us. We find that ld.CIT(A) has not given effective opportunity of hearing to appellant to substantiate and prosecute the appeal. We also observe that only two hearings were provided to the assessee on 29.12.2020 i.e; during Covid-19 period and on 27.03.2024 i.e; just 2 days before passing the impugned order. We are of the considered view that in this case ld.CIT(A) has not observed the principles of natural justice. Accordingly, in the light of aforesaid factual position and in the interest of justice, we deem it fit to set aside the impugned order to the file of Ld. CIT(A) for denovo adjudication of appeal on merits. The ld.CIT(A) will provide proper opportunity of hearing to the assessee during the hearing of the appeal afresh. The assessee is directed to substantiate its case forthwith without any fail, failing which Ld. CIT(A) shall be at liberty to proceed with the disposal of the appeal as per law.

In the result, appeal filed by the assessee is allowed for statistical purpose.