JAWAHAR NAZEEM MOHAMMED NAZEEM,TRIVANDUM vs. ITO WARD 1(4) , TRIVANDRUM

This is an appeal filed by the assessee challenging the orders of the NFAC, Delhi dated 23/12/2022 in respect of the assessment year 2013-14.

The brief facts of the case are that the assessee filed her return of income on 25/11/2014 and thereafter the return was selected for scrutiny through CASS and assessment proceedings were initiated for the reason that the cash deposits made during the relevant year exceeds the turnover reported by the assessee. The assessee also filed the reply and also provided the details in support of her argument and contended that the assessee is running a small scale readymade shop and the income returned was calculated on presumptive basis. The assessee also contended that she had effected sale of property and the said sale proceeds were deposited with the HDFC Bank, Thiruvananthapuram. The AO sought for more details in respect of the properties sold by the assessee and the proof in respect of the cost of construction of residential property and the details of investment in capital gain account scheme. The assessee also filed all the details required by the AO. But the AO disallowed the claim of exemption u/s. 54 and arrived the long term capital gains. As against the said order of the AO, the assessee filed an appeal before the Regular CIT(A) in time and also filed the copy of the appeal memorandum with the jurisdictional Assessing Officer. Thereafter, it seemed that the appeal was transferred to the NFAC, Delhi and the said transfer was not known to the assessee and he has also not received any notices issued by the NFAC and therefore not appeared before the NFAC and hence the NFAC had dismissed the appeal for want of records including the memorandum of appeal. As against the said order of the Ld.CIT(A), the assessee has filed this appeal before this Tribunal with the following grounds:

At the time of hearing, the Ld.AR submitted that the assessee is a homemaker and she has not received the notices issued by the Ld.CIT(A) and therefore she was not able to appear before the Ld.CIT(A). The Ld.AR further submitted that the appeal was originally filed before the jurisdictional CIT(A) and thereafter the same were transferred to the NFAC which facts were not in the knowledge of the assessee and therefore she was not able to furnish the appeal memorandum filed before the jurisdictional CIT(A). The Ld.AR therefore prayed an opportunity to appear before the Ld.CIT(A).

The Ld.DR relied on the orders passed by the lower authorities and prayed to dismiss the appeal.

We have heard the arguments of both the sides and perused the records.

In this appeal, the assessee filed her return of income and also participated in the assessment proceedings and also filed the appeal before the jurisdictional CIT(A) in time when the AO had levied tax under the head long term capital gains. The appeal field before the Ld.CIT(A) was later on transferred to the NFAC, Delhi and the NFAC had verified the case details in the ITBA portal and they found that no records are available in the ITBA portal including the appeal memorandum. Therefore the NFAC had issued notices to the assessee as well as to the jurisdictional AO through the portal and sought for the various documents in order to consider the appeal. Unfortunately, the notices sent through the portal was not known to the NFAC. We have seen that the NFAC also issued notices to the jurisdictional AO for furnishing the various documents. Unfortunately, the jurisdictional AO also failed to furnish the records and therefore the NFAC having no other way, had dismissed the appeal.

In our view, the assessee being a homemaker was not well versed in viewing the portal and therefore she has not responded to the notices issued by the NFAC. But the AO also not filed the records sought for by the NFAC. Therefore both the assessee as well as the assessing officer had failed to respond to the notices issued by the NFAC and therefore we are of the view that one more opportunity is to be granted to the assessee to appear before the NFAC, Delhi with the documents sought for by the NFAC in the notices in order to adjudicate the appeal on merits.

We therefore set aside the order of the CIT(A) and remit the issue to the file of the Ld.CIT(A) with the direction to decide the appeal on merits after hearing the assessee and also after considering the various records filed by the assessee in support of her claim.

In the result, the appeal filed by the assessee is partly allowed for statistical purposes. Order pronounced in the open court on 20th September, 2024.