LAXMAIAH ENUGURI,GADWAL vs. ITO., WARD-1, MAHBUBNAGAR

The brief facts of the case are that the assessee is an individual and is into the wholesale business of coconut trading in the name & style of M/s. Tirumala Coconut Traders. The assessee e-filed his return of income for the A.Y 2016-17 on Page 1 of 4 31.12.2016 declaring total income of Rs.5,63,230/-. As per the information available with the Department, the assessee made payments to the suppliers to the tune of rs.2.40 crores whereas the purchases were shown at Rs.1.96 crores only though no creditors are shown by the assessee. Thus, the Assessing Officer noticed that there is a difference of Rs.44.00 lakhs (Rs.2.40 crore – Rs.1.96 crores) which required to be verified and brought to tax. Further, the Assessing Officer noted that the total cash deposits in the bank accounts stands at Rs.3.30 crores, whereas the assessee admitted turnover at Rs.2.11 crore only. Thus, there is a difference of Rs.1.19 crore(approx.) sources of which needs to be verified and brought to tax. Since the assessee failed to upload return in response to the notices within 30 days of the receipt of notice, show cause notice u/s 144B of the I.T. Act, 1961 was issued on 3.2.2022. The assessee remained non-responsive. The Assessing Officer completed the assessment under “best judgment assessment” and assessed the total income of the assessee at Rs.1,67,88,930/-.

In appeal, the learned CIT (A) dismissed the appeal filed by the assessee on the ground of “barred by limitation”.

Aggrieved by the order of the learned CIT (A), the assessee is in appeal before the Tribunal.

The learned Counsel for the assessee submitted that the assessee could not appear or file any written submission with documentary evidences before the Assessing Officer. Therefore, it was the submission of the learned Counsel for the assessee that given an opportunity, the assessee would be in a position to file all the requisite details with documentary evidence/bank statements, etc., before the Assessing Officer.

The learned DR, on the other hand, supporting the orders of the authorities below submitted that despite serving statutory notices, the assessee failed to comply with the notices issued by the Assessing Officer and the appeal filed before the learned CIT (A) was time also time barred. Hence, the orders of the Assessing Officer and learned CIT (A) should be upheld and the appeal filed by the assessee should be dismissed.

We have heard both the parties, perused the material available on record and gone through the orders of the authorities below. We find that the assessee failed to comply with the statutory notices issued by the Assessing Officer and the appeal filed by the assessee before the learned CIT (A) was time barred. Considering the totality of the facts and circumstances of the case, we deem it proper to restore the issue back to the file of the Assessing Officer with a direction to grant another opportunity to the assessee to substantiate his case by filing the requisite details/evidences before the Assessing Officer. The assessee is Page 3 of 4 also hereby directed to appear before the Assessing Officer on the appointed date and time with all the requisite details without seeking any adjournment. Since the assessee failed to comply with the statutory notices issued by the Assessing Officer, we levy a charge of Rs.2,000/- on the assessee. The assessee is directed to pay a sum of Rs.2,000/- at the Telangana State Legal Aid Authorities at the Hon'ble Telangana High Court within a period of one month from the date of this order and submit necessary payment slip with the Registry. We hold and direct accordingly.

In the result, appeal filed by the assessee is allowed for statistical purposes.