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Income Tax Appellate Tribunal, Hyderabad ‘ B ‘ Bench, Hyderabad
Before: Shri Vijay Pal Rao, Vice-Shri Madhusudan Sawdia
Per Vijay Pal Rao, Vice President
1. This appeal filed by the assessee is directed against the order, dated 24/11/2023 of the learned CIT (A)-NFAC Delhi, relating to A.Y.2013-14.
The assessee has raised the following grounds of appeal: “1. The order of the learned Commissioner of Income Tax (Appeals) is against the law, weight of evidence and probabilities of case.
2. The learned Commissioner erred in confirming the order of the Assessing Officer wherein, an addition of Rs.53,51,650/- is made u/s 69 of the IT Act and further an amount of Rs.5,35,008/- was Page 1 of 6 added as income from other sources, which was already included in the computation of income and further disallowed Rs.3,15,500/- claims made under Chapter VIA to determine the total income at Rs.82,21,820/- as against the income returned Rs.20,19,660/-.
The learned Commissioner ought to have appreciated that the ACIT, 15(1), is not having the jurisdiction over the assessee, as the assessee is having income from salary, capital gains and other sources and filed the return of income before the ITO 11(2), Hyderabad which is a salary ward 4. The learned Commissioner ought to have appreciated that the ACIT 15(1), has not issued notice u/s 143(2), therefore, his order u/s 143(3) dt: 18.03.2016, is an invalid order.
The learned Commissioner ought to have accorded one more opportunity to the assessee by issuing a letter stating that there is no representation to the earlier notices as the assessee was depending upon the Counsels for representation and the assessee is not aware that the case is not being represented. Therefore, the order of the learned Commissioner is in violation of Principles of Natural Justice.
6. The learned Commissioner erred in confirming the order of the Assessing Officer as the assessee having sufficient cash balance as he has sold his agricultural lands.
The appellant craves leave to add to, amend or modify the above grounds of appeal either before or at the time of hearing of the appeal, if it is considered necessary “.
3. This is the 2nd round of litigation, as in the first round, the Tribunal, vide order dated 15/09/2021, remanded the matter to the record of the learned CIT (A) for fresh adjudication, after giving an opportunity of hearing to the assessee with the direction to the assessee to appear and file all the relevant evidences before the learned CIT (A). In the remand proceedings, the assessee again did not appear before the learned CIT (A) and consequently, the learned CIT (A) has upheld the order of the Assessing Officer, which is now challenged by the assessee in the present appeal.
The learned AR of the assessee has submitted that due to unavoidable circumstances, the assessee could not appear in the proceedings before the learned CIT (A) and therefore, the impugned order was again passed ex-parte by the learned CIT (A). He has further contended that, now the assessee has raised an additional issue in Ground Nos.3 & 4 of the grounds of appeal and challenged the jurisdiction of the Assessing Officer to issue the notice u/s 143(2) and the consequential order. Thus, the learned AR has contended that the assessment order passed by the Assessing Officer is invalid and liable to be quashed as notice u/s 143(2) was issued by the ITO Range-15(2), whereas the assessment order passed by the ACIT Circle 15(1) Hyderabad.
5. On the other hand, the learned DR has objected to the raising of the additional ground and submitted that, the assessee participated in the assessement proceedings and did not raise any objection regarding the jurisdiction of the Assessing Officer. Even no such objection was raised by the assessee before the learned CIT (A) as well as before the Tribunal in the first round of litigation, but this objection has been raised for the first time before the Tribunal in the 2nd round of litigation, without complying with the directions of this Tribunal, passed vide order dated 15/09/2021 while remanding the matter back to the record of the CIT (A). Thus, the learned DR has submitted that the present appeal of the assessee is not maintainable and devoid of any merit, liable to be dismissed.
We have considered the rival submissions as well as the material available on record. In the first round of appeal, this Tribunal vide order dated 15/09/2021 remanded the matter back to the record of the learned CIT (A) with the observation as under:
This appeal filed by the assessee is directed against CIT(A) - 7, Hyderabad's order dated 05/03/2019 for AY 2013-14 involving proceedings u/s 143(3) of the Income Tax Act, 1961 ; in short 'The Act
In the course of hearing, it was pointed out by the learned counsel of the assessee that the learned CIT(A) had decided the matters ex-parte. Therefore, it would be in the interest of justice, the matter may be restored to his file for deciding various grounds of appeal on merits. The Id. AR undertook to produce all the relevant documents to substantiate his case before the CIT[A]. The learned DR agreed with the aforesaid statement of the learned AR.
2. We have considered the facts of the case and the request made by the learned AR. We are of the view that interest of justice will be served if the matter is restored to the file of first appellate authority for deciding various grounds of appeal of the assessee on merits. Accordingly, the CIT[A] is directed to afford reasonable opportunity of being heard to the assessee and thereafter decide the appeals on merits. We direct the assessee to appear before CIT(A) with all the relevant evidences; at his own risk and responsibility to be followed by three effective opportunities of hearing.”
7. Thus, only to take a lenient view and in the interest of justice, the Tribunal restored the matter to the file of the learned CIT (A) for deciding the appeal on merits, after affording a reasonable opportunity of hearing to the assessee. The assessee was also directed to appear before the learned CIT (A) with all the relevant evidences at its own risk and responsibility, to be followed by 3 effective opportunity of hearings. The learned CIT (A) issued 4 notices to the assessee, the details of which are as under:
S.No Date of hearing Date fixed Remarks notice (set aside) submission/hearing 1 18/09/2023 03/10/2023 No compliance 2 11/10/2023 18/10/2023 No compliance 3 19/10/2023 26/10/2023 No compliance 4 26/10/2023 06/11/2023 No compliance
It is pertinent to note that, the assessee was directed to appear before the learned CIT (A) and furnish all the relevant evidences at his own cost and responsibility, while remanding the matter to the record of the learned CIT (A) for fresh adjudication on merits. However, despite 4 opportunities given by the learned CIT (A), the assessee did not appear nor filed any submission or documentary evidences, in support of the sources of deposits in the bank account. The assessee has not explained a cogent reason for non-compliance of the notices issued by the learned CIT (A) as well as the direction of this Tribunal while remanding the matter before the learned CIT (A). The only explanation by the assessee is that he was busy with the Insurance Companies in pursuing the claim of insurance, in pursuant to the fire incidents in the factory taken place on 22nd April, 2023. We find that there is no co-relation between this fire incident and the notices issued by the learned CIT (A) and further the learned CIT (A) has given as many as 4 opportunities to the assessee, but there was no response on behalf of the assessee. If the assessee was busy in pursuing the claim with the insurance company, he could have sought further time to comply with the notices to file relevant evidence before the learned CIT (A). Citing this reason without even giving the details about any meeting with the personnels of the insurance company during the relevant period, this Page 5 of 6 explanation of the assessee is very vague and cannot be considered a reasonable cause for non-compliance before the learned CIT (A). Further, the assessee has now raised the issue of validity of the assessment order for the first time in the 2nd round of appeal, that too, when there was no compliance either before the Assessing Officer or before the learned CIT (A) despite availing enough opportunity in two rounds of litigation. Hence we do not find any reason to interfere with the impugned order of the learned CIT (A).
In the result, appeal filed by the assessee is dismissed.