KULDIP RAMESH BAAGWE,PUNE vs. ITO, WARD 6(3), PUNE, PUNE

The appeal filed by the assessee is directed against the order dated 24.05.2023 of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [“CIT(A)”] pertaining to the (“AY”) 2010-2011.

The appeal is time barred by 307 days before the Tribunal. The assessee has filed an application for condonation of appeal alongwith an affidavit explaining the reasons which led to the delay in filing the appeal. After hearing both the sides, we are of the view that the delay is attributable to the sufficient cause. We therefore, condone the delay and admit the appeal for adjudication.

Briefly stated, the facts of the case are that from the NMS-1/2 cycle it was found that during the relevant AY 2010-2011 the assessee had made cash deposits of Rs. 1,86,85,000/- in Bank of India, Pune and purchased a four wheeler for Rs. 7,24,000/-. Since the assessee had not filed Return of Income for the relevant AY, the Ld. Assessing Officer (“AO”) had reason to believe that the income of the assessee escaped assessment u/s 147 of the Income Tax Act, 1961 (“the Act”). Accordingly, notice u/s 148 of the Act was issued/served upon the assessee on 31.03.2017. The assessment proceedings culminated in framing of assessment for AY 2016-2017 on income of Rs. 1,01,57,457/- including therein addition of Rs. 94,00,000/- as unexplained cash credit under section 68 of the Act and addition of Rs. 7,24,000/- as unexplained investment u/s 69 of the Act. The assessment order for AY 2010-2011 was passed on 27.12.2017 u/s 144 r.w. section 147 of the Act.

The assessee filed appeal before the Ld. CIT(A)/NFAC challenging the aforesaid additions made by the Ld. A O. Due to non- compliance of notice(s) of hearing by the assessee, the Ld. CIT(A)/NFAC dismissed the appeal of the assessee for non prosecution and endorsed the finding of the Ld. A O by relying on the decision of the Hon'ble Supreme Court in the case of CIT Vs. BN Bhattacharya (1997) 118 ITR 461 (SC) and decision(s) of the Delhi Tribunal in the case of CIT Vs. Multiplan India Pvt. Ltd 381 ITD 320 (Delhi) and Vipul Logistic & Warehousing (P) Ltd. Vs. ITO.

The assessee is in appeal before the Tribunal against the ex-parte order of the Ld. CIT(A)/NFAC for non appearance of the assessee during the appellate proceedings and all the grounds of appeal relate thereto.

We have heard the Ld. representatives of the parties and perused the record. It is submitted by the Ld. AR that the non compliance before the Ld. CIT(A)/NFAC has occured due to the reason that the notice of hearing were issued on e-mail address swapnilgandhioffice@gmail.com which belonged to the assessee’s erstwhile Tax Consultant. The said e-mail address was different from the e-mail Id mentioned in Form 35 at the time of filling appeal before the Ld. CIT(A)/NFAC i.e. pune@cascg.in and neither the appellate order nor the notice of hearings were received on this email mentioned in Form 35. The erstwhile Tax Consultant did not intimate the assessee about receipt of notices of hearing or the receipt of appellate order on his email Id. We observe that the Ld. CIT(A)/NFAC has not adjudicated on the merits of the case and the issues raised by the assessee before him. The appellant order reveals that the Ld. CIT(A) has applied the decision in the case of BN Bhattacharya (supra) wherein the Hon'ble Apex Court while dealing with the issue of prosecution of appeal has observed that:-

No doubt the Ld. CIT(A)/NFAC may decide the appeal ex-parte where the assessee does not prosecute his appeal inspite of several opportunities. None-the- less, he has to adhere to the legislative mandate enshrined in sub-section (6) of section 250 of the Act which requires him to state the points for determination, the decision thereon and the reason for the decision. We observe that the Ld. CIT(A)/NFAC has passed the order in concurrence of the order of Ld. AO without himself going into the merits of the case. Thus, in our view, his order is in violation of the provisions of section 250(6) of the Act.

On the facts and in the circumstances of the case, we deem it fit, in the interest of justice and fair play, to set aside the order of the Ld. CIT(A)/NFAC and restore the matter back to his file for adjudication afresh and pass speaking order on merits after allowing reasonable opportunity of being heard to the assessee who shall provide the requisite support in terms of submitting the relevant documents / evidence as may be required/called upon. We order accordingly.

In the result, the appeal of the assessee is treated as allowed for statistical purposes.