PREM CHAND GUPTA,ALWAR vs. ITO, ALWAR

Shri Prem Chand Gupta, cuke Income Tax Officer, Vs. D-83, Hasan Kha Mewat Nagar, Ward 2(3), Alwar. Alwar. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No. AMFPG 6481 J vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : None jktLo dh vksj ls@ Revenue by : Smt. Monisha Choudhary, Addl. CIT lquokbZ dh rkjh[k@ Date of Hearing : 05/12/2023 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 19/12/2023 vkns'k@ ORDER PER: SANDEEP GOSAIN, J.M.

This appeal by the assessee is directed against the order dated 06.10.2023 of ld. CIT (A), National Faceless Appeal Centre (NFAC), Delhi passed under section 250 of the IT Act for the assessment year 2011-12. The assessee has raised the following grounds :-

“1. That the appellate order is bad in law on the particulars facts of the appellant case. That the appellate order passed by the Honorable CIT(A) is contrary to the facts written submission and provisions of law. 2. That Honorable CIT(A) has erred in both in law and on facts without applying his judiciary mind and taking only technical ground and dismissed the ground and confirmed the addition without satisfying the statutory 2 636 & 637/JP/2023 Mohit Polytech Pvt. Ltd., Jaipur. preconditions for initiation of the proceedings provided under the Income Tax Act, as such are void and without jurisdiction. That the Honorable CIT(A) has not correctly checked each fact and information that assesse has provided satisfactory documents for genuineness of the transaction and Aadhar Card and Identity proofs alongwith the stamp papers for affidavit cum confirmation letter from the persons to whom he has lent advances and received back.

3. That Honorable CIT(A) has erred in both in law and on facts without applying his judiciary mind and taking only technical ground and dismissed the ground and confirmed the addition of Rs.6,00,000 only relying upon that "In the affidavits almost same language incorporated has been i.e. advanced in the year 2009-10, cash transactions for last 10- 15 years and the advance amount was returned on 20-12-2020 by all the persons. It seems that the assesse purchased the 09 stamp papers and typed same language on 18-12- 2018 to manage the source of cash deposits after thought". This is totally wrong thought by Honorable CIT(A) only on seerns or estimation basis. Since this is the onus of assesse only to satisfy the Ld. AO that he has received the money from the persons to whom he has advanced money in earlier years. So assesse needs to borrow the stamp papers in his name and get it signed by all the persons from whom he has received back his advanced money of past years along with confirmation letter and their identity proofs.

4. That Honorable CIT(A) misinterpreted the AO findings regarding the advances provided by assesse during the past years to their villagers and farmers.

at the time of hearing and all the grounds are without prejudice to each other.

8. Under the circumstances it is prayed that the Assessment Order passed under Sec 144 read with Sec 147 is not fair and just. Hence the appeal has been preferred before your Honour. It is prayed that the additions made in the returned income of the appellant may be deleted and/or grant any other relief as your Honour may deem fit to meet the end of the justice.”

2. The brief facts of the case are that the assessee is an Individual. The case of the assessee was re-opened for assessment under section 147 of the IT Act, 1961 with the approval of the ld. Pr.CIT. Accordingly notice under section 148 was issued by the ITO on 29.03.2018 and served on the assessee on 31.03.2018. Thereafter, notices under section 142(1) along with query letter was issued on 28.09.2018, 11.10.2018 and 22.10.2018 but the assessee did not comply with the notices issued. Thereafter a show cause notice under section 144(1) of the IT Act was issued on 05.11.2018 for reply by 12.11.2018. In compliance to the said show cause notice, representative of the assessee attended and furnished documents which were taken on record and the case was discussed. The case of the assessee was selected for scrutiny assessment to verify the cash deposits of Rs. 32,24,500/- in saving bank account of IDBI Bank and commodity transactions of Rs. 5,46,300/- done during the period under consideration. As the assessee did not file its return of income, therefore, the above cash deposits and commodity transactions could not be verified. However, the assessee during the proceedings filed its Income Tax Return on 19.11.2018 declaring total income of Rs. 18,620/- with agriculture income of Rs. 10,03,256/-. The assessee vide his letter dated 20.12.2018 explained the cash 4 636 & 637/JP/2023 Mohit Polytech Pvt. Ltd., Jaipur. deposits and commodity transactions. The AO considered the reply of the assessee but could not found it acceptable. Thus the AO completed the assessment by assessing the total income of the assessee at Rs. 14,97,750/- vide his order dated 20.12.2018 under section 147 read with section 144 of the IT Act. Aggrieved by the order of assessment, the assessee preferred appeal before ld. CIT (A), who has decided the appeal of the assessee ex-parte vide his order dated 06.10.2023 by allowing part relief.

Now the assessee is in appeal before the Tribunal.

5 636 & 637/JP/2023 Mohit Polytech Pvt. Ltd., Jaipur. “ Ground No. 3: I have gone through the Assessment Order, Grounds of appeal

, statement of fact & appellant submission filed during the course of appellate proceedings. On careful consideration of the same it is seen that firstly the A.O. has not given credit for opening cash balance of Rs. 5,50,000/- claimed by the appellant in the absence of return of income filed or books of account of earlier years submitted before him. However, it is seen that the AO himself has accepted the agricultural income of the appellant for the current year at Rs. 8,38,692/- and has not disputed the fact that the assessee is an agriculturist and having only source of agriculture income. In view of the above facts there remains no reason for the AO to not to accept the opening cash balance of Rs. 5,50,000/-. Accordingly, the appellant’s gets relief of Rs. 5,50,000/- and the AO is directed to give credit for the opening cash balance of Rs. 5,50,000/-. Similarly, the AO has made addition of Rs. 1,64,564/- out of agriculture income on estimate basis without bringing any corroborative evidence on record to support his estimate. Since the addition has been made merely on estimate basis the AO is direct to delete the same. Further it is seen that the above sum of Rs. 1,64,564/- has also been added while computing the unexplained cash in bank account u/s 69. (as per para 4 of asst. order) amounting to Rs. 13,14,564/-. The AO is therefore, directed to delete the same i.e. Rs. 1,64,564/- from the addition made u/s 69 of the IT Act. However, the assessee could not establish the genuineness of the transaction and identity of persons who have taken advances from him and has returned the amount back. The AO has given specific findings in the Assessment Order that “In the affidavits almost same language has been incorporated, i.e. advanced in the year 2009-10, cash transactions for last 10-15 years and the advance amount was returned on 20/12/2020 by all the persons. It seems that the assessee purchased the 09 stamp papers and typed same language on 18/12/2018 to manage the source of cash deposits after thought.” In view of the above, this ground of appeal is dismissed and addition of Rs. 6,00,000/- is confirmed.”

6 636 & 637/JP/2023 Mohit Polytech Pvt. Ltd., Jaipur. The ld. CIT (A) considering the material available on record and also taking into consideration the order passed by the AO, partly allowed the appeal of the assessee. 3.1 Before me, the ld. A/R of the assessee submitted that although the assessee could not appear before the ld. CIT (A) as mentioned by him during the course of arguments but he has categorically submitted that he had filed the written submissions and documents before ld. CIT (A) through e-portal, but the said documents were not properly considered by the ld. CIT (A) while disposing off the present appeal. Since the impugned order of the ld. CIT (A) was passed ex parte for on the basis of material available on record, by partly upholding the assessment order under section 147 read with section 144 of the IT Act, whereby the AO made additions, therefore, in the totality of facts and circumstances of the case and in the interest of justice, I am of the view that it will be reasonable to provide one more opportunity to the assessee. I, thus, set aside the ex-parte order of the ld. CIT (A). Be that as it may, without going into merits, considering the interest of natural justice, one more opportunity is granted to the assessee, and the file is restored back to the ld. CIT (A) for consideration afresh after providing a reasonable opportunity of being heard to the assessee, subject to cost of Rs. 2,000/- for negligent attitude during income tax proceedings, to be deposited in the Prime Minister’s Care Fund and proof thereof should be produced. The assessee is further directed to furnish necessary documents/evidences as required by ld. CIT (A). In case the assessee fails to appear before the ld. CIT 7 ITA Nos. 635, 636 & 637/JP/2023 Mohit Polytech Pvt. Ltd., Jaipur. (A), the ld. CIT (A) may decide the appeal on the basis of the material available on record.