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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM
Before: SHRI DUVVURU RL REDDY, HON’BLE
(धििाधरणिरध/ Assessment Year: 2013-14) Shyam Sunder Maheshwari v. Income Tax Officer – Ward – 2(1) Guntur - 522007 Subham Maheshwari 4-4-141, 7th Line Chandramouli Nagar Guntur – 522007, Andhra Pradesh [PAN : AVDPS7940P] (अपीलार्/ Appellant) (प्र्/ Respondent) करदाताकाप्त्ि्िध/ Assessee Represented by None : राजसकाप्त्ि्िध/ Department Represented by Dr. Aparna Villuri, Sr.AR : सुिवाईसमापहोिेक््त्ि/ Date of Conclusion of Hearing 03.09.2024 : घोषणाक्तार्ख/Date of Pronouncement 05.09.2024 : आदेश/O R D E R
PER SHRI DUVVURU RL REDDY, JUDICIAL MEMBER:
This appeal is filed by the assessee against the order of Learned Commissioner of Income Tax (Appeals), [hereinafter in short “Ld.CIT(A)”], National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No. ITBA/NFAC/S/250/2023-24/1061812956 (1) dated 01.03.2024 Shyam Sunder Maheshwari Subham Maheshwari arising out of order passed Under section 147 r.w.s. 144 of the Income Tax Act, 1961 (in short ‘Act’) dated 21.09.2021 for the A.Y. 2013-14.
Briefly stated facts of the case are that, assessee is an individual derives income from salary, business and other sources. Notice under section 148 of the Act was issued, further a notice under section 142 was also issued. However, the applicant could not file any reply for the notices issued by the Revenue Authorities due to Covid-19 Pandemic. Thereafter the assessment under section 144 / 147 was completed by the Assessing Officer and made an addition of Rs. 27,00,000/- on account of undisclosed income from the head “income from other sources”. During the year under consideration assessee had received loan amount of Rs.20,00,000/- from M/s. Emkay Consultant on 20.07.2012 and M/s. Karan Mercantile Pvt Ltd of Rs.7,00,000/- on the even date. This money was urgently needed by the assessee for matrimonial settlement with Aditi Sharma. As the amount was paid to Aditi Sharma as a part of appellant matrimonial settlement. Therefore, the assessee is not a beneficiary of the transaction in question. Hence the funds are not at all taxable in the hands of the assessee. Therefore, the Assessing Officer is not at all correct to made addition of Rs.27,00,000/-.
Page No. 2 Shyam Sunder Maheshwari Subham Maheshwari 3. On being aggrieved, assessee preferred an appeal before Ld. CIT(A) but the appellant even after receipt of the hearing notices on various dates but he did not file any supporting documents on his contentions as per the grounds of appeal raise by him. Therefore, the Ld. CIT(A) disposed off this appeal based on the merits available on record.
On being aggrieved, assessee preferred an appeal before me and raised following grounds of appeal: - “1. FOR THAT the order of the Authorities below is bad in Law and devoid of any merit and liable to be struck down in Appeal.
2. FOR THAT Ld. CIT(A) in any event, did not adjudicate the grounds of appeal and did not go through assessment records and the other materials available on record and he has capriciously and arbitrarily dismissed the appeal without applying his mind in appellant's case.
3. FOR THAT the CIT(A) erred in law in invoking provisions of Section 68 in your appellant’s case although the petitioner maintained no Books Of Accounts and accordingly, Section 68 has no application in this case
4. FOR THAT the Ld. Appellate Authority totally disregarded the material available on record and merely relied upon the investigation report that the assessee is a beneficiary of Rs. 27,00,000/-of accommodation loan.
5. FOR THAT the assessment was framed during the highest Covid-19 wave and when the entire country was under lock down and the assessee could not respond in the assessment stage before the Assessing officer due to pandemic condition prevailed at that time.
6. FOR THAT at the Appellate Stage the assessment was framed without giving the appellant an opportunity of being heard as the hearing notices was sent through e-mail which remain unnoticed as Page No. 3 Shyam Sunder Maheshwari Subham Maheshwari the appellant was not conversant about the new system of e- proceeding and the e-appeal, 7. FOR THAT the reopening of the case is bad in Law on the face of the order of assessment as no reasons for reopening was supplied to the appellant for rebuttal and the Authority completely relied upon the investigation win$ report without application of independent mind.
8. FOR THAT from the order framed by the Authority below it is clear that the assessee has received loan fund from different corporate entity who are assessed to tax regularly and additions if any is to be made in the hands of the entities provided loans i.e. Emkay Consultants.
9. FOR THAT the appellant is certainly not the beneficiary of the said fund as the fund was immediately transferred to his wife for matrimonial settlement.
10. FOR THAT in view of decisions of the Hon'ble ITAT Kolkata in the case of ITO Ward-12(2) vs. M/S. Happy Structure Pvt. Ltd, the appellant is not liable to be assessed for the disputed fund as M/S.Emkay Consultants are regularly assessed to tax and cash was not deposited in the A/c of the Loan provider. As the loan creditors has been assessed to tax u/s 143(3) of the I T Act there is no doubt about the source of the fund in question under the hands of the Appellant.”
Inspite of issue of notice none appeared on behalf of assessee nor any adjournment was sought. Therefore, I proceed to dispose of this appeal on hearing the Ld. DR.
At the outset, Ld. Departmental Representative [hereinafter in short “Ld. DR”] has brought to my notice that the assessee has not participated the proceedings before the Assessing Officer or before the Ld. CIT(A) and she pleaded to confirm the orders passed by the revenue Authorities.
Page No. 4 Shyam Sunder Maheshwari Subham Maheshwari 7. Heard Ld. DR and perused the material available on record. As per the record notices under section 142 and 148 of the Act were issued and due to Covid-19 pandemic assessee not able to participate the proceedings before the Revenue Authorities. Therefore, considering the facts and circumstances of the case and in order to meet the principles of natural justice, I am of the view that it is a fit case to remit the matter back to the file of the Ld. CIT(A) for fresh consideration and the assessee is directed to cooperate with the proceedings before the Ld. CIT(A) and in turn Ld. CIT(A) call for remand report, if necessary, and dispose off the case on merits. Therefore, the grounds raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 05th September, 2024.