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Facts
The assessee's return of income was selected for scrutiny. The Assessing Officer added Rs. 5,98,83,865/- as unexplained credits. The CIT(A) affirmed the addition, inter alia, observing that the assessee failed to provide evidence.
Held
The Tribunal held that both the Assessing Officer and the CIT(A) had passed ex parte orders without affording a reasonable opportunity to the assessee. Therefore, the matter was restored for de novo assessment.
Key Issues
Whether the assessment and appellate orders were passed without affording reasonable opportunity to the assessee. Whether the addition made under Section 68 was justified without proper consideration of evidence.
Sections Cited
143(3), 68, 250(6)
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Income Tax Appellate Tribunal, DELHI BENCH “E”: NEW DELHI
Before: Ms. MADHUMITA ROY
O R D E R
PER Ms. MADHUMITA ROY, JM:
The instant appeal, preferred by the assessee, is directed against the order dated 22.02.2019 passed by the Ld. CIT(A), Delhi-6 in Appeal No. CIT(A), Delhi- 6/10194/2016-17, arising out of the order dated 30.03.2016 passed by the Income Tax Officer- Ward 18(1), New Delhi, under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2013-14.
The only effective ground raised by the assessee herein relates to the sustenance of addition of Rs. 5,98,83,865/- made by the Assessing Officer on account of unexplained credits under Section 68 of the Act. was filed on 14.07.2014 declaring Nil income. The case was selected for security through CASS and notice under section 143(2) was issued on 23.12.2015 by speed post. The assessee company is engaged in the business of purchasing or otherwise acquiring lands, houses, building, sheds and other fixtures on land and buildings and letting them out on rent, contract or any other agreement as may be deemed fit by the company. In its financial statements the assessee had claimed 'Short Term Borrowings-Unsecured' as under:
Particulars As on 31.03.2013 As on 31.03.2012 Southend Infrastructure Rs.4,60,00,000 - (P) Ltd. DMRC Rs.3,08,06,356 Rs.1,69,22.491
According to the Learned Assessing Officer the assessee failed to discharge the onus of proving identity, genuineness and creditworthiness of the creditors. He, therefore, added Rs. 5,98,93,865/- as unexplained cash credit under Section 68 of the Act. In appeal the Learned First Appellate Authority affirmed the addition, inter alia, observing as under:
“6. This appeal has been filed by the appellant claiming that the action of the AC is not supported by facts and laws and that it is unjust. In such a situation, it is for the appellant to furnish submissions with relevant evidence(s), case laws, if any, to support the claim. The burden of proof is always on the person who makes the claim. In this case, it is the appellant who has made the claim by filing the appeal. Thus, in cases where a particular receipt is sought to be taxed as income, the trutial onus is on the AO to prove that it is taxable. Where, however, the assessee claims exemption, the burden is on the assessee to prove it to be exempt. Same is the position in case of all allowances, deductions, claims or loss, etc. Since an appeal is nothing but the claim of the appellant that he has been unduly unjustifiably taxed, it is for the appellant to prove its case. The appellant has not availed any opportunity to do so. 7 Since the appellant has not availed of the opportunity to submit documents in its support, it is presumed that the appellant has nothing to submit with regard to the addition made. Hence, the addition made is upheld. All the grounds of appeal are dismissed.” Aggrieved against the order of Learned CIT(Appeals) the assessee is in appeal before us.
5. Ld. Counsel for the assessee at the outset submitted that in the instant case the Assessing Officer has framed the assessment without affording reasonable opportunity to the assessee. Further, in appeal the Learned First Appellate Authority has also not dealt with the matter in terms of the provisions of Section 250(6) of the Act and has dismissed the assessee’s appeal, ex parte, without considering the merits on the issue raised before him. He prayed that the matter may be restored to the file of the Assessing Officer for de novo assessment after affording reasonable opportunity of being heard to the assessee.
5. Ld. DR relied upon the order of ld. CIT(A).
We have heard the rival submissions and perused the materials available on record. Having regard to the ex parte assessment framed by the Learned Assessing Officer and as also affirmed by the Learned First Appellate Authority, that too by an ex parte order, we deem it fit and proper, in order of fair play to both the parties and to sub serve the principle of natural justice, to restore the mater back to the file of the Assessing Officer for de novo assessment after affording an opportunity of being heard to the assessee and upon considering the evidence on record or any other evidence which the assessee may choose to file in afresh proceedings. We also make it clear that in the event the assessee does not cooperate with the Learned Assessing Officer, the said authority would be at liberty to proceed with the matter and finalize the same strictly in accordance with law. Ordered accordingly.
In the result, assessee’s appeal is allowed for statistical purposes. Order pronounced in open court on 23.10.2025.