BALASAHEB PUNDIKRAO GHORMODE,AKOLA vs. INCOME TA OFFICER WARD-1, AKOLA

In its appeal, the assessee has raised following grounds:–

Facts in Brief:– The assessee qualified as matriculation, poor agriculturalist resides in a Mofussil area at Unakhed, Wai Mana, at Taluka Murtizapur, District Akola. The assessee owns a few acres of agricultural land and runs his livelihood on the income generated out of agriculture produce and agriculture income is the sole source of income over the years. It is stated that the assessee is not aware of the income tax provisions and procedures, as he never filed his income tax return, since he is not required to file the return of income. As per the information available with the Department, it was noticed that during the year under consideration, the assessee has invested ` 5,88,900, as his 1/4th share in the property purchased along with three others for the consideration of ` 22,65,000 plus ` 90,600, incurred for stamp duty charges, totalling to ` 23,55,600. The case was reopened by issuing notice dated 27/03/2021, under section 148 of the Income Tax Act, 1961 ("the Act"). On receipt of the first notice under section 148 of the Act, yet the assessee did not file his return of income and the assessee contacted to local person who used to write the books of accounts and assured the Assessee that he would hire the services of some Chartered Accountant or Advocate to deal with the notice and get the issue resolved. The issue was being handled by a qualified professional, but subsequently failed to comply with the notices issued by the Income Tax Department which 3 Balasaheb Pundlikrao Ghormode ITA no.409/Nag./2023 resulted in passing final assessment order under section 147 r/w section 144 of the Act by the Assessing Officer. The scrutiny assessment was completed under section under section 147 r/w section 144 of the Act by the concerned ITO, Ward-1, Akola, vide order dated 14/03/2022, assessing total income at ` 5,88,900, made under section 69A of the Act treating as unexplained investment. The assessee being aggrieved filed the appeal before the first appellate authority i.e., National Faceless Appeal Centre, Delhi.

However, even before the first appellate authority also, the appeal remained unattended by the said professional counsel which also resulted in passing of the ex–parte order by the first appellate authority. The observations of the learned CIT(A) dismissing the appeal of the assessee are reproduced below:–

I have heard the rival arguments, perused the material available on record and gone through the orders of the authorities below. During the course of hearing, the learned Authorised Representative appearing for the assessee has produced receipts showing agricultural income which proves that the assessee is carrying on agricultural activities and deriving income therefrom. I also find that the assessee has made small investment which can be ascribed to be a part of savings from the income derived from agricultural activities during preceding years. Keeping the above in view, I am of the considered opinion that the addition made by the Assessing Officer and confirmed by the learned CIT(A) has no merit hence the addition made under section 69A of the Act treating the investment made by the assessee as unexplained is hereby directed to be deleted. The grounds raised by the assessee are allowed.

In the result, appeal filed by the assessee is allowed. Order pronounced in the open Court on 18/09/2024