RAM KISHOR MANDAL,BIHAR vs. ITO WARD 3(2), BIHAR

It was submitted by the ld. AR that the original assessment order is an ex parte order. It was also submitted that before the ld. PCIT, the assessee was not represented. It was the submission that the Chartered Accountant of the assessee who was looking after the assessee’s accounts had given his email and phone number on the assessee’s income-tax portal and all communications and notices from the departments were going to him and the assessee was not made aware of the same. It was the submission that only when demand notices came to the assessee, the assessee came to know of the department’s proceedings. It was the submission that this has led to a delay of 1004 days in filing the appeals. It was the submission that the delay may be condoned and the assessee’s appeals be heard on merits.

We have heard the submission of the ld. AR. Considering the fact that the assessee’s C.A has been made responsible for the failure on behalf of the assessee, at this point, a question was specially asked to the ld. AR if any proceedings against the said C.A has been done by filing a complaint before the ICAI, the ld. AR submitted that as a professional courtesy, he has advised not to file any compliant. It was also asked to & 98/Pat/2025 him whether there is any affidavit of the said C.A, to which he replied that the C.A is not cooperating and there is no affidavit. Admittedly, the assessee should not be deprived of right to be heard just because there is delay and it is an admitted fact that when substantial justice and technicalities are pitted against each other, then substantial justice deserves to prevail. Considering this view, the delay in filing the appeal of the assessee is condoned.

Coming to the merits, it was submitted by the ld. AR that the order u/s 263 has been issued on an issue which is beyond the scope of limited scrutiny. It was then put to the ld. AR, when the assessment order itself is an ex parte order and there is no verification of any facts by the Assessing Officer how it can be said that the order passed by the Assessing Officer is not erroneous when the issue of cash deposits itself has not been considered by the Assessing Officer. It was the submission that the assessment order clearly shows that the Assessing Officer examined the bank account and after considering the bank account, the income of the assessee has been estimated and the return filed by the assessee has been accepted. It was the submission that the order passed u/s 263 was also an ex parte order. It was the prayer that the issues may be restored to the file of the Assessing Officer for re-adjudication.

We have heard the rival submissions. A perusal of the assessment order passed u/s 144 on 14.11.2019 shows that the Assessing Officer has considered the cash deposits to the Central Bank of India, account number ending with 0087 and 0002. A perusal of the order u/s 263 shows that the bank accounts are with Canara Bank and there is another bank account with PNB ending with 1213. Admittedly, the assessee has been given substantial opportunities by both the Assessing Officer and PCIT, the assessee admittedly has not cooperated to the assessment order of 2019, the order u/s 263 of 2022. It is also to be mentioned here that the appeal against the quantum addition being appeal order to the effect to the order passed u/s 263, is wherein the assessment order is also ex parte and the order of the ld. CIT(A) are also ex parte. The assessee submits that he has received notice of demand and how he has received the demand notice is completely silent. It must also be mentioned here that both the appeals were filed on 28.02.2025, repeated adjournments have been & 98/Pat/2025 taken. This clearly shows that there is no bona fides in the claims of the assessee that the assessee was deprived of any opportunity and unable to represent his case. The ground raised by the assessee is that the order of the ld. PCIT u/s 263 was beyond the limited scrutiny also does not stand to reasons in so far as the assessee has been non-cooperative before the Assessing Officer and thus has led to the Assessing Officer to accept the returned income by not going into the accounts. Had the Assessing Officer gone into the accounts, obviously he could find the defects and ask for widening the scope of the limited scrutiny. As we are not convinced with the reasons given for non-presentation before the Assessing Officer in the course of original assessment order passed u/s 144 on 14.11.2019 and also order u/s 263 passed on 02.03.2022. This being so, the order of the ld. PCIT stands upheld and is hereby dismissed. However, considering the fact that the consequential assessment order and order of the ld. CIT(A) against the assessment order which is also ex parte, we grant one more opportunity to the assessee to substantiate his case and the issues in are restored to the file of the Assessing Officer for re-adjudication after granting the assessee adequate opportunity of being heard.