LATE PRATAPSINGH KARTARSINGH WALIA REPRESENTED BY HIS LEGAR HEIR MRS. AMARJEETKAUR PRATAPSINGH WALIA ,PUNE vs. INCOME TAX OFFICER, WARD-8(4), PUNE, PUNE
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Income Tax Appellate Tribunal, “B” BENCH, PUNE
Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA
PER ASTHA CHANDRA, JM : Two appeals filed by the assessee are directed against the two separate order(s) both dated 29.07.2022 of the Ld. Commissioner of Income Tax (Appeals)-13, Pune [“CIT(A)”] pertaining to Assessment Years (“AYs”) 2013-14 and 2014-15. Since, the issue(s) involved are identical, these were heard together and are being disposed of by this common order.
Both the appeals are time barred. ITA No. 752/PUN/2024 is late by 568 days and ITA No. 751/PUN/2024 is late by 563 days. The assessee has moved an application for condonation of delay. Sworn affidavit has been filed along with the application stating therein the reasons which are as under :
“4. That aggrieved by the order of the learned AO, late Pratapsingh Kartarsingh Walia had filed an appeal before hon'ble CIT(A) on 28/01/2017. After filing of appeal, the he was died due to heart attack on 06/06/2017. Copy of death certificate is attached herewith in Annexure A.
That on his demise, my son. Mr. Harbane Singh Pratapsingh Watia had tied a legal heir affidavit with CIT(A). He had also submitted a request letter to CIT(A) for early hearing But hearing was not granted. My son. Mr. Harbans Singh Pratapsingh Walia was also died on 15/12/2018. Copy of death certificate is enclosed herewith in Annexure B. AY 2013-14 & 2014-15
That because of father son demise, the family was under trauma. Even nobody was aware about the proceedings with CIT(A) and therefore no one could appear on the dates of hearing.
That Hon'ble CIT(A) has passed the appeal order on 29/07/2022 ex-parte and upheld the order of learned AO.
That was not aware about the order passed by the hon'ble CIT(A), I came to know about the order only when my daughter suo motto checked the status of the late Pratapsingh Kartarsingh Walia on Income Tax portal. She came to know about the order passed by CIT(A) only in the month of February 2024. After finding the order of CIT(A), I consulted the tax consultant and decided to file an appeal with Hon'ble ITAT.
That The time period for filing the appeal with Hon'ble Income Tax Appellate Tribunal is passed but I being a senior citizen and widow of Pratapsingh Kartarsingh Walia humbly pray your honour to consider the case sympathetically and admit the appeal.
That delay in filing an appeal has sufficient cause and there is no any intension to jeopardize the interest of revenue by delaying the filing of an appeal.”
1 After hearing both the sides, we are of the view that the delay is attributable to the sufficient cause. We, therefore, condone the delay in both the appeals and proceed to decide the appeals.
ITA No. 752/PUN/2024 for AY 2013-14
The assessee has raised the following grounds of appeal :
“1. On the facts and circumstances of the case and in law the learned AO and the CIT(A) was not justified in making / upholding addition of Rs.1,01,31,000/- on account of undisclosed cash credits in various bank account of the appellant. The provisions of section 68 are not applicable to the facts of this case as no books of account have been maintained. The addition be deleted.
On the facts and circumstances of the case and in law the leaned AO and CIT(A) was not justified in allowing/upholding 7 days withdrawal preceding to cash deposit as a source of cash deposits. The addition be reconsidered accordingly.
On facts and circumstances of the case and in law and alternatively once deposits in the bank account are held to be from business carried on by the assessee, the normal net profit percentage as per section 44AD of the Income Tax Act, 1961 can be treated as income for assessment. It be held accordingly.
On facts and circumstances of the case and in law the learned AO and CIT(A) was not justified in making/upholding addition of Rs.5,50,032/- on account of fixed deposits. Addition needs to be deleted.
On facts and circumstances of the case and in law and in the alternative the addition of Rs.5,50,032/- is not sustainable as appellant has sufficient source for such deposits. The addition be deleted. AY 2013-14 & 2014-15
The appellant craves to leave, add, amend, alter or delete any or all of the above grounds of appeal.
Briefly stated, the facts of the case are that the assessee (Late Pratapsingh Kartarsingh Walia, legal heir Mrs. Amarjeetkaur Pratapsingh Walia) was proprietor of Walia Roadlines and engaged in transportation business. The business activity was carried out through the vehicles on hire. Based on the information received on AIMS modules/ITD system that the assessee has made cash deposits of Rs.1,54,84,535/- in various banks and earned interest from credit societies of Rs.5,67,077/- during the FY 2012-13 relevant to AY 2013-14, the case of the assessee was reopened u/s 147 of the Income Tax Act, 1961 (the “Act”) and notice u/s 148 of the Act was issued on 21.01.2016 which was duly served on the assessee. In response to the notice u/s 148 of the Act, the assessee filed his return of income for AY 2013-14 on 22.12.2016 declaring total income of Rs.9,58,680/-. Statutory notice(s) u/s 142(1) and 143(2) of the Act were issued from time to time seeking the explanation regarding the sources of cash deposits with the banks during the FY 2012-13, in response to which the assessee submitted bank statements. The Ld. Assessing Officer (“AO”) observed that during the course of assessment proceedings the assessee has only furnished copies of bank statements and did not furnish details regarding the sources of cash deposits and term fixed deposits. He, therefore, completed the assessment u/s 143(3) r.w.s. 147 of the Act on 28.12.2016 by computing the income of the assessee as under : Return of Income Rs.9,58,680/- Add :- (i) Unexplained cash deposits Rs.1,01,31,000/- (ii) Interest income Rs.3,40,334/- (iii) Unexplained term deposits Rs.5,50,032/- Assessed income Rs.1,19,80,046/-
Aggrieved, the assessee carried the matter before the Ld. CIT(A). Before the Ld. CIT(A) there was non-compliance of notice(s) of hearing and the Ld. CIT(A) dismissed the appeal of the assessee for non-prosecution and endorsed the findings of the Ld. AO. The relevant findings of the Ld. CIT(A) reads as under : “3.3 I find that the Appellant has chosen not to attend or the any written submission in pursuance to his own appeal therefore I am of the view that the government cannot waste its own resources in time and money by providing endless opportunities to pursue taxpayers their own appeals, especially when numbers of pending appeals are high. The more AY 2013-14 & 2014-15
opportunities to a particular taxpayer are always at the cost of opportunity to other taxpayer of getting his appeal heard early. Accordingly, I presume that the Appellant is not interested in pursuing his own appeal. In the case of Anil Goel Vs CIF (2008) 305 ITR 212 (Punjab & Haryana), the Hon'ble High Court held as under : It is thus obvious on the plain language of section 250 of the Act that date and place of hearing was duly fixed. The assessee was also given notice along with notice to the Assessing Officer, The assessee had ample opportunity to make his submission by appearing in person or through authorized representative. Despite fixing the case for seventeen hearings, no one had put in appearance nor any justifiable reason for adjournment was given."
4 By not choosing to prosecute his own appeal, the appellant has done more harm than good. I find that the appellant has been given 12 opportunities to attend or file submission, however, the appellant has not furnished any explanation or corroborative evidence for the additions made by the AO. The appellant has taken the plea that he does not maintain any books of accounts for running his transportation business. This is not acceptable as appellant has filed the return on 22.12.2016 based on some accounting for his income. This is a case of not furnishing books of accounts deliberately to avoid proper taxation. When the appellant does not produce any books of accounts and does not furnish acceptable explanation for huge cash deposits in the bank accounts, the AO has all the right to adopt judicious method to determine the taxable income. The AO has analysed various cash deposits in para 4.1 of his order and allowed telescoping of cash withdrawal with deposits. Following case laws support this view: (i) Kavita Chandra Vs CIT P&H High Court 2017[2017] 81 taxmann.com 317 (Punjab & Haryana) / [2017] 248 Taxman 358 (Punjab & Haryana)/ [2017] 398 ITR 641 (Punjab & Haryana): Cash withdrawals were made for purpose of business and same was not available for redeposit and, assessee was unable to link cash withdrawn from bank to cash deposit, same would be held to be assessee's unexplained income. (ii) Shri Arunkumar J Muchhala Vs CIT Bombay High Court 2017 [2017] 85 taxmann.com 306 (Bombay)/ (2017] 250 Taxman 362 (Bombay)/[2017] 399 ITR 256 (Bombay), 2017-TIOL-1666-HC-MUM-IT Even after giving adequate opportunities if an assessee fails to maintain and produce books with respect to NRI gift received, such receipt is to be treated as unexplained cash credit u/s 68. It was vehemently argued on behalf of appellant that Books of accounts have not been maintained by the Petitioner and therefore Sec. 68 of 1. T. T Act will not be applicable. Therefore, I find no infirmity in the order passed by the A.O. by making additions of Rs.1,01,31,000/- on account of unexplained cash deposits and Rs.5,50,032/-on account of unexplained deposits.”
Dissatisfied, the assessee in appeal before the Tribunal and all the grounds of appeal relate thereto.
The Ld. AR submitted that non-appearance before the Ld. CIT(A) was not intentional. He submitted that after filing of appeal before the Ld. CIT(A) the assessee died due to heart attack on 06.06.2017. A copy of his death certificate was placed on record. After his demise his son Mr. AY 2013-14 & 2014-15
Harbans Singh Pratapsingh Walia, legal heir filed an affidavit with the Ld. CIT(A). Mr. Harbans Singh Pratapsingh Walia also died on 15.12.2018 and his death certificate is also on record. Despite, these facts being on record, all the notice(s) were issued by the Ld. CIT(A) on the deceased person. The Ld. CIT(A) proceeded to pass the impugned order on 29.07.2022 ex-parte dismissing the appeal of the assessee for want of prosecution. He, therefore, urged that the matter may be sent back to the file of Ld. CIT(A) to decide the appeal of the assessee afresh on merits.
The Ld. DR supported the order of Ld. CIT(A) and argued that the Ld. CIT(A) was fully justified in upholding the order of Ld. AO and dismissing the appeal of the assessee.
We have heard the Ld. Representatives of the parties and perused the records. The appellate order reveals that the Ld. CIT(A) has applied the decision of the Hon’ble High Court of Punjab & Haryana in the case of Anil Goel Vs. CIT (2008) 306 ITR 212 (P & H). No doubt, the Ld. CIT(A) may decide the appeal ex-parte where the assessee does not prosecute his appeal in spite 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 thereof and the reasons for the decision. It is an admitted fact that the assessee and his legal heir both had died before the notice(s) of hearing were issued during the appellate proceedings by the Ld. CIT(A). We observe that the Ld. CIT(A) has passed the impugned 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 Ld. CIT(A) and restore the matter back to his file for adjudication afresh and pass speaking order on merit after allowing reasonable opportunity of being heard to the assessee who shall provide the requisite support in terms of submitting the relevant documents/information/evidence as may be required, called upon. We order accordingly. AY 2013-14 & 2014-15
In the result, the appeal of assessee in ITA No. 752/PUN/2024 for AY 2013-14 is allowed for statistical purpose.
ITA No. 751/PUN/2024 for AY 2014-15
Both the sides are unanimous in stating that the facts and the grounds of appeal in ITA No. 751/PUN/2024 are identical to the grounds raised in ITA No. 752/PUN/2024 except the variance in amounts. Thus, in view of the fact that the issue raised in the appeal are identical and are arising from same set of facts, the findings given by us while adjudicating the appeal in ITA No. 752/PUN/2024 would mutatis mutandis apply to the appeal in ITA No. 751/PUN/2024, as well. Accordingly, the appeal of the assessee is allowed for statistical purpose in the same terms.
To sum up, both the appeals of the assessee for AYs 2013-14 (ITA No. 752/PUN/2024) and 2014-15 (ITA No. 751/PUN/2024) are allowed for statistical purposes.
Order pronounced in the open court on 27th September, 2024. (R.K. Panda) VICE PRESIDENT पुणे / Pune; दिन ांक / Dated : 27th September, 2024. रदि
आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : अपील र्थी / The Appellant. 1. प्रत्यर्थी / The Respondent.
The Pr. CIT concerned. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “बी” बेंच, 4. पुणे / DR, ITAT, “B” Bench, Pune. ग र्ड फ़ इल / Guard File. 5. //सत्य दपि प्रदि//// आिेश नुस र / BY ORDER,
िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune
