DEVINENI MADHU PAVANI,NALLAJERLA MANDAL vs. THE INCOME TAX OFFICER, WARD-1(4), VISAKHAPATNAM

1. This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No. ITBA/NFAC/S/250/2023-24/1059335746(1) dated 03.01.2024, arising out of order passed u/s 144 of the Income Tax Act, 1961 (in short ‘Act’) dated 26.09.2019 for the Assessment Year (A.Y.) 2017-18. Devineni Madhu Pavani, Nallajerla Mandal

Aggrieved by the order of the Ld.CIT(A), the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal :

The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case.

The learned Commissioner of Income Tax (Appeals) is not justified in dismissing the appeal in-limine by invoking s.249(4) of the Act.

Any other grounds may be urged at the time of hearing. 4. At the outset, the Ld.AR submitted that the assessee married in August, 2013, received 8 acres of agricultural land at Nallajerla Mandal as Stree Dhan and leased out the land to Shri G.Gopala Rao, lessee along with 3 acres owned by her mother and received advance payment @ Rs.8,00,000/- from the lessee and Rs.3,00,000/- as gift from her mother out of the advance payment received from the leased out land. The Ld.AR further submitted that the assessee had also received cash gift of Rs.1,00,000/- from her father on 07.11.2016, who derives agricultural income from 11 acres of land at Nallajerla Mandal. The assessee derives agricultural income, but did not file return of income as the assessee never had any taxable income. During demonetisation, the assessee deposited the total amount of Rs.12,00,000/- in SBNs . The Ld.AR further submitted that the assessee could not comply with the notices before the Ld.AO due to ill health, related to spine problem, which led to partial paralyzing of her right leg and was advised bed rest and physiotherapy. The Ld.AR further submitted that the assessee has sources for making cash deposits. The Ld.AR further submitted that the Ld.AO is not justified in treating the Devineni Madhu Pavani, Nallajerla Mandal cash deposit of Rs.12,00,000/- as unexplained investment u/s 69 of the Act, which was erroneously upheld by the Ld.CIT(A). He, therefore, pleaded to afford an opportunity of being heard before the Ld.AO for substantiating her case with the available material evidences, otherwise, the assessee would suffer a great financial loss.

Per contra, the Ld.DR argued that the assessee was given sufficient opportunities, but the assessee did not comply with the notices issued, hence, the Ld.CIT(A) is justified in dismissing the appeal of the assessee. The Ld.DR, therefore, pleaded to uphold the order passed by the Ld.CIT(A) and dismiss the appeal of the assessee.

I have heard both the parties and perused the material available on record. It is evident that the assessee had deposited cash of Rs.11,00,000/- received from the lessee and Rs.1,00,000/- from her father, during demonetization period in SBNs. As submitted by the Ld.AR, the assessee firm could not comply with the notices issued by the department due to ill health. He, pleaded for an opportunity of being heard before the Ld.AO to substantiate her case in support of her claim, in the interest of justice. In view of the forgoing facts and circumstances of the case and in order to meet the principles of natural justice, I am Devineni Madhu Pavani, Nallajerla Mandal inclined to remit the matter back to the file of the Ld.AO with a direction to verify the sources for the cash deposits made and pass order accordingly. The assessee is also directed to adhere to the notices issued and cooperate with the department during the proceedings. Accordingly, the grounds raised by the assessee are allowed for statistical purpose.

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