RAVUTHU MEERA RAVUTHAR ABDUL RAZACK,PUDUKKOTTAI vs. ITO,WARD 1, PUDUKKOTTAI, PUDUKKOATTAI

आदेश / O R D E R

PER ABY T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the

Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter ‘the

Ld.CIT(A)’), Delhi, dated 25.10.2023 for the Assessment Year (hereinafter

‘AY’) 2017-18.

parte action of Ld.CIT(A) confirming the action of the AO by taking note

that though notices had been issued to assessee on four occasions, the

ITA No.1550/Chny/2023 (AY 2017-18) Ravuthu Meera Ravuthar Abdul Razack :: 2 ::

assessee has not bother to respond. So, he dismissed the appeal of the

assessee. Further, the Ld.AR of the assessee also pointed out that in

their case even the AO has also passed an ex parte order u/s.144 of the

Income Tax Act, 1961 (hereinafter "the Act"). Therefore, in the interest

of justice, he prays that the appeal of the assessee may be restored back

to the file of the AO for de novo assessment. The Ld.AR brought to our

notice that assessee is a super senior citizen and is suffering from many

ailments [loss of memory, hard of hearing and other ailments]. Therefore,

he was handicapped from properly running the business which caused

loss from his proprietorship concern and therefore, did not file return of

income in the relevant AY. But, it was pointed out that he was regularly

filing the VAT return. And since, in the relevant year under consideration,

assessee had deposited Rs.50,91,600/- as cash during demonetization

period, the AO took up the case for scrutiny and passed an ex parte

order adding, inter alia, the entire sum (Rs.50,91,600/-) u/s.69 of the

Act, as unexplained investment; and treated balance amount in bank

account of Rs.2,93,51,283/- as the turnover of the assessee and

estimated 5% as income of the assessee from undisclosed business

income. According to the assessee, the credit in the bank account was

regular trading receipts which is evident from perusal of the VAT returns.

According to the Ld.AR, due to the ailments, etc., the assessee could not

properly place on record relevant documents to prove the trading receipts

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including the cash deposits (nature and source of cash deposits); and

failure to consider the relevant documents by the AO during assessment

proceedings has resulted in failure of justice; therefore, he pleads that

one more opportunity be granted before AO, since assessee did not get

proper opportunity during assessment proceedings.

that the assessee should not be granted one more innings before the AO.

on record. We are not repeating the aforesaid facts again for the sake of

brevity; and we find that the assessee is a super senior citizen (above

age of 80 years) undergoing treatment for several ailments and has

frequent memory loss and hard to hear. During the year under

consideration, assessee who is a proprietor of M/s.KRA Distributor’s

claims to have suffered net loss of Rs.47,783/- from the business of

distribution of edible oil. According to the assessee, he was regularly

filing VAT returns, but did not file the return of income due to bona fide

belief that since he had incurred loss, he need not file the return of

income u/s.139(1) of the Act. However, the AO issued notice u/s.143(2)

taking note of the cash deposits made during the demonetization period

to the tune of Rs.50,91,600/-; and taking note of other credit entries in

his bank account, and being not satisfied with the reply of the assessee

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that the credits/cash deposits are trading receipts, had made an addition

of Rs.50,91,600/- u/s.69 of the Act, [as unexplained investment]; and the

balance credit entries in the bank account to the tune of Rs.2,93,51,283/-

was treated as the turnover of the assessee from undisclosed business

and estimated 5% as income from such business i.e. Rs.14,67,564/-. On

appeal, the Ld.CIT(A) dismissed the appeal finding no response from the

assessee. According to the assessee, the assessee was not provided

proper opportunity before the AO which prompted the AO to pass order

u/s.144 of the Act (best judgment assessment). The AO noted that

despite several notices issued to the assessee he responded only in

November & December, 2019 and furnished some documents online.

However, AO was of the opinion that assessee didn’t succeed in

explaining the source of deposit of cash of Rs.50,91,600/- which was

deposited during the demonetization period; and therefore, he passed

assessment order on 29.12.2019 u/s.144 of the Act. The assessee’s only

plea is that he didn’t get proper opportunity before AO, so he couldn’t

place relevant documents before the AO to substantiate the nature and

source of the deposit in the bank account i.e. from the trading receipts of

the assessee’s business. We note that assessee is a super senior citizen

with the several ailments and could not place on record relevant

documents before AO. Therefore, taking into consideration the peculiar

facts and circumstances of the case, we are inclined to set aside the

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impugned order of the Ld.CIT(A) and restore the assessment back to the file of the AO with a direction to frame de novo assessment after hearing

the assessee. The Ld.AR undertakes to file all relevant documents/written

submissions before the AO. The AO to give proper opportunity to the

assessee and frame the assessment in accordance to law as held by the

Hon’ble Supreme Court in the case of TIN Box Company v. CIT reported

in [2001] 249 ITR 216 (SC).

Order pronounced on the 29th day of May, 2024, in Chennai. Sd/- Sd/- (मनोज कुमार अ�वाल) (एबी टी. वक�) (MANOJ KUMAR AGGARWAL) (ABY T. VARKEY) लेखा सद�य/ACCOUNTANT MEMBER �याियक सद�य/JUDICIAL MEMBER

चे�ई/Chennai, �दनांक/Dated: 29th May, 2024. TLN, Sr.PS आदेश क� �ितिलिप अ�ेिषत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु� (अपील)/CIT(A) 4. आयकरआयु�/CIT 5. िवभागीय�ितिनिध/DR 6. गाड�फाईल/GF