Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, JAIPUR BENCHES,”SMC” JAIPUR
Before: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA No. 613/JPR/2023
vkns'k@ORDER PER: DR. S. SEETHALAKSHMI, J.M. This appeal is filed by the assessee against the order of the ld. CIT(A) dated 10.08.2023, National Faceless Appeal Centre, Delhi [herein after referred to as"NFAC"] for the assessment year 2017-18.
The assessee has raised the following grounds of appeal:-
"1. On the facts and in the circumstances of the case, the ld. CIT(A) NFAC dismissed the appeal filed by the assessee without providing the reasonable opportunity to the assessee to submit its submission.
2 Om Raj Rajeshwari Jewellers vs. ITO 2.On the facts and in the circumstances of the case, the order CIT (A) NFAC erred in dismissing the appeal of the appellant in summary manner just for the sole reason that the appellant could not file its written submission before CIT (A) and conforming the action of ld. AO. The appeal was dismissed by ld. CIT (A) without deciding the issues on merits and without considering submission made before AO in judicial perception and decided the appeal of the assessee blindly relying on the finding of ld. AO.
3. On the facts and circumstances of the case the Id. CIT(A) NFAC erred in confirming the action/additions made by ld. AO erred in: - 3.1 rejecting the books of accounts of the assessee by applying the provisions of section 145(3) of Income Tax Act, 1961. 3.2 not treating the purchases made from M/s Paras Gems &Jewellers and M/s Vinay Gems &Jewellers as genuine without having any cogent reasons and only on the basis of presumptions and assumption. The Id. AO further erred in not giving the opportunity in this regard to the assessee to prove the genuineness of purchases so made from these parties. 3.3. treating the part amount of Rs. 44,24,207/-deposited in bank account in the demonetized currency, as undisclosed income of assessee and by applying the provisions of section 68 of the Act and the same was added as income of the assessee and taxed as per the provisions of section 115BBE of the Act. The entire addition is based only on presumption, assumption basis and having no material or irrelevant material. The addition was made without considering the submission and documents of the assessee in the judicial perspective. 4.The appellant prays for leave to Add, to amend, to delete, or modify the all or any grounds of appeal on or before the hearing of appeal.”
Brief facts of the case are that the assessee is a partnership firm engaged in the business of trading of gems & Jewellery. The case of the assessee was taken up for complete scrutiny u/s 143(3) of the Income Tax Act, 1961 on the basis of manually selection for scrutiny. The assessment of the assessee was completed by the ld. AO vide his order dated 27.12.2019 at total income of Rs. 44,24,210/- against the return loss of Rs. 74,824/-. The ld. AO made an addition of Rs.
3 Om Raj Rajeshwari Jewellers vs. ITO 44,24,207/- by applying the provisions of section 68 of the Act treating the part amount deposited in the bank in demonetized currency as undisclosed income of assessee and accordingly, the same was taxed as per the provisions of Section 115BBE of the Act.
Being aggrieved by the order of the AO, the assessee filed an appeal before the ld. CIT(A). The ld. CIT(A) observed that notices were issued on 06.01.2021, 06.07.2023, 20.07.2023 & 28.07.2023 requiring the assessee to file the details in support of grounds taken by the assessee. Since the assessee has not complied with the notices issued by the ld. CIT(A) but he has dismissed the appeal of the ex-parte order. The extract of the order of the ld. CIT(A) is reproduced as under:-
“9. Inview of the reasons mentioned above and settled position of the law by Hon'ble Supreme Court in the aforementioned cases, the genuineness of the sale bills could not be verified. Most of the sale bills look manoeuvred and self made, before the depositing undisclosed cash of the assessee of Rs. 69,94,000/- on various dates tills 16.12.2016, were issued without third party evidence/ involvement and the explanation offered by the assessee in this regard is not satisfactory with the proper documentary evidence.
However, considering the fact, which cannot be ruled out, that the assessee was engaged in the regular business of jewellery and hence, the cash deposited during the demonetization period, being a peculiar period, must be inclusive of his genuine sale proceeds as well and the best way to ascertain the cash earned on account of genuine cash sale is to take into account the cash sale shown during October and till 8th November, 2015 as this period of Year 2015 and 2016 covered most of big festivals/ auspicious occasions like deepawali, 4 Om Raj Rajeshwari Jewellers vs. ITO marriages, etc and such festivals/ occasions fell in these two FYs also during October and November and further allowing thereon weightage on account of overall inflation, changes in price of diamond/ gold etc. @ 30.72%. The sale in shown during October, 2015 was Rs.4 41 741/- and from 1st November to 8th November, 2016 was Rs. 2,10,604/- totalling to Rs. 6,52,345/-, Hence, this way the cash earned by the assessee out of genuine cash sale is worked out at Rs. 8,52,745/- after allowing weightage of 30.72% over last year turnover shown during this period. Accordingly unexplained cash deposited during demonetization period is calculated in the following manner: A. Cash deposited from 1.10.2015 to 16.12.2016 ] (net off cash withdrawn) Rs. 84,44,000/- B. Less: Cash in hand as on 01.10.2016 as per CB Rs. 24,71,615/- C. Add: Cash in hand after depositing Rs. 69,94,000/- Rs. 3,69,067/- D. Net Cash deposited Rs. 63,41,452/- E. Less: Sale amount worked out for the period From 01.10.201 to 08.11.2016 Rs. 8,52,745/- F. Unexplained cash deposited during demonetization period (D-E) Rs. 54,88,707/- G. Income surrendered under PMGKY Rs. 10,84,5000/- H. Net unexplained cash deposited during Demonetization period Rs. 44,24,207/- Hence, as worked out above Rs. 44,24,207/- is held to be undisclosed income available with the assesses in the form of cash prior to demonetization period and the same is added to his total income u/s 68 of the Income tax act to be taxed in terms of section 115BBE of the Act.
Decision: In view of the factual matrix considering failure on part of the appellant to explain and substantiate the source of cash deposits inspite of various opportunities granted for making submission in support of the appeal filed and non-compliance by the appellant as on date, the appeal is treated as DISMISSED.”
5 Om Raj Rajeshwari Jewellers vs. ITO 5. During the course of hearing, the ld. AR for the assessee prayed that the Id. CIT(A) has passed the ex-parte order and the assessee was not provided adequate opportunity of being heard. Thus, the assessee may be provided one more opportunity to advance his arguments/submissions before the ld. CIT(A) in the interest of equity and justice.
6. Per contra, the ld. DR supported the orders of the lower authorities praying that the assessee was provided various opportunities by the lower authorities to argue the case but the assessee was lethargic and unserious to pursue her case and thus the order passed by the ld. CIT(A) should be sustained.
We have heard both the parties and perused the materials available on record. The assessee did not appear or filed any reply to the notices which were issued by the ld. CIT(A), finally the ld. CIT(A) completed ex-parte order before the ld. CIT(A). Further, we observed that the assessee or his legal representative did not appear before appellate proceedings in spite of several notices, it is evident in the ld. CIT(A) order. Thus, the bench feels that the assessee because of any reasons could not advanced his arguments/submissions to contest the case before the Ld. CIT(A) and the ld. AR for the assessee also prayed to give one more opportunity to submit the evidences concerning the issue in question, with grounds so raised by the assessee, to decide
6 Om Raj Rajeshwari Jewellers vs. ITO it afresh by providing one more opportunity of hearing. Therefore, we set aside the issue before the ld. CIT(A). However, the assessee will not seek any adjournment on frivolous ground and remain cooperative during the course of proceedings before the ld. CIT(A).
Before parting, we may make it clear that our decision to restore the matter back to the file of the ld. CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the ld. CIT(A) independently in accordance with law.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 20/12/2023.
Sd/- Sd/- ¼jkBkSM deys'k t;UrHkkbZ ½ ¼MkWa-,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 20/12/2023 *Santosh आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू The Appellant- Om Raj Rajeshwari jewelers, Jaipur. 1. 2. izR;FkhZ@ The Respondent- ITO, Ward-2(1),Jaipur. 3. vk;djvk;qDr@ The ld CIT 4. विभागीय प्रतिनिधि] आयकरअपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZQkbZy@ Guard File vkns'kkuqlkj@ By order,
सहायकपंजीकार@Aेेजज. त्महपेजतंत