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Assessee represented by Shri Nilesh Patel, CA Department represented by Shri Vinod Kumar, Sr. DR Date of Institution of appeal 10/03/2023 Date of hearing 17/04/2023 Date of pronouncement 17/04/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of learned National Faceless Appeal Centre (NFAC), Delhi/Commissioner of Income Tax (Appeals) (in short, the ld. CIT(A)) dated 27/01/2023. The assessee has raised following grounds of appeal: “1. On the facts and in the circumstances of the case and in law the learned Assessing Officer has erred in making addition of Rs. 12,84,029/- knowing the fact that Bank account is holding jointly by husband and wife.
2. On the facts and in the circumstances of the case and in law the learned Assessing Officer has erred in making addition of Rs. 11,30,000/- while the same amount has been assessed in the hand of joint holder Shri Nilamkumar A. Desai for the A.Y. 2011-12 by ITO, Ward-4, Navsari.
3. The appellant craves leave to add to amend to modify and or alter the present ground of appeal.”
2. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that in this case, the assessment order under Jayshreeben Nilamkumar Desai Vs ITO Section 144 r.w.s. 147 of the Income Tax Act, 1961 (in short, the Act) was passed on 30/10/2018. In the assessment order, the Assessing Officer made total addition of Rs. 12,84,029/- consisting of Rs. 11.30 lacs cash deposit and Rs. 1,54,029/- on account of other credit in the bank account by treating at as unexplained credit. The assessee fled appeal before the ld. CIT(A) on 23/03/2019, thus, there was delay of 140 days in filing appeal before the ld. CIT(A). Before the ld. CIT(A), the assessee filed application for condonation of delay in explaining the cause of delay in filing first appeal. The delay in filing appeal was neither intentional nor deliberate due to the bonafide reasons that the assessee was not aware about the technicalities of filing appeal in income tax matter. The addition against the assessee was made on the basis of cash deposit in bank account. The assessee was having joint bank account with her husband and for collecting evidence from the bankers and other evidence of agricultural holding in the name of husband, the delay was occurred. The assessee has good case on merit and suffered loss and injury as the department has also made similar addition with respect of same account against the husband of assessee. The ld. AR of the assessee submits that he has filed assessment order in case of Shri Nilamkumar A. Desari having PAN No. AAKPD 0899 G (husband of assessee) wherein same addition of Rs. 11.30 lacs on account of same deposit in Joint bank account with Axis bank, was made. The ld. AR of Jayshreeben Nilamkumar Desai Vs ITO the assessee submits that the ld. CIT(A) after dismissal of the appeal, not adjudicated the grounds of appeal on merit. The ld. AR of the assessee submits that the delay in filing appeal before the ld. CIT(A) may be condoned with the direction to consider various grounds of appeal on merit.
1. On the other hand, the learned Senior Departmental Representative (ld. Sr. DR) for the revenue opposed the plea of condonation of delay as argued by the ld. AR of the assessee. The ld. Sr. DR submits that the assessee has not explained the cause of delay. Cause of delay is not bonafide. The assessee has not made any compliance before the Assessing Officer. The assessment was completed under Section 144 of the Act on the basis of evidences and material available before the Assessing Officer. Again the assessee instead of filing appeal within time, filed appeal belatedly. To support his submission, the ld. Sr.DR of the revenue relied upon the decision of Hon'ble Apex Court Civil Appeal No.7696 of 2021 in the case of Majji Sannemma @ Sanyasirao Vs Reddy Sridevi & Ors.
3. In short rejoinder, the ld. AR of the assessee submits that the assessee has very good case on merit as the revenue has taxed the same cash credit twice, once in the hands of assessee as well as in the hands of her husband. Appeal of her husband is still pending before the ld. CIT(A)
Jayshreeben Nilamkumar Desai Vs ITO 4. I have considered the submissions of both the parties and have gone through the orders of the lower authorities carefully. I find that the case of assessee was reopened on the basis of information that the assessee has not filed return of income and there was cash deposit of Rs. 11.30 lacs in her savings bank account with Axis Bank. The Assessing Officer after recording reasons of reopening under Section 147, issued notice under Section 148 of the Act on 23/03/2018. The Assessing Officer recorded that no return of income was filed in response to notice under Section 148 of the Act. The Assessing Officer obtained information about the deposit in bank account with Axis bank, Navsari. In response to such notice, the bankers of assessee furnished required details on 30/03/2018 and confirmed the deposit of Rs. 11.30 lacs. The Assessing Officer on considering such information, further noted that there was other credit entry of Rs. 1,54,029/-. Thus, there was aggregate credit of Rs. 12,84,029/-. The Assessing Officer accordingly made addition on account of unexplained investment in the assessment order dated 03/10/2018 passed under Section 144 r.w.s. 147 of the Act, in absence of any explanation or response from assessee.
Aggrieved by the additions and reopening, the assessee filed appeal before the ld. CIT(A) on 03/10/2018. Alongwith appeal, the assessee also filed her affidavit for condonation of delay. In the affidavit, the assessee contended that no return of income was filed by her as her Jayshreeben Nilamkumar Desai Vs ITO income was below the taxable limit. No books of account was required to be maintained. The matter was very old and considerable time was passed as her case relates to A.Y. 2011-12. The assessee collected bank account and other material and his accountant prepared necessary details and books of account. Due to non-availability of such material evidence, the assessee cold not produce the details before the Assessing Officer in time which resulted in passing ex parte order. The assessee in the affidavit also prayed to produce additional evidence. For admission of additional evidence, the assessee contended that the documents are necessary to decide the matter effectively and completely. The assesse tried her best with due diligence to produce document but she could not receive such documents in time. Such documents are necessary to prove the genuineness of claim of assessee. There was no fault on the part of assessee as the assessee made sufficient effort to collect such evidence.
The composite application of assessee for condonation of delay as well as additional evidence was dismissed by the ld. CIT(A) by holding that the assessee was required to show sufficient cause for condonation of delay. The assessee has not shown reasonable cause to which prevented her from filing appeal within prescribed time. The assessee lacks due diligence in presenting appeal. The assessee has not fulfilled the requirement of Section 249(2)(b) and 249(3) of the Act. Thus, the delay was not condoned and appeal was dismissed as unadmitted. As recorded Jayshreeben Nilamkumar Desai Vs ITO above, before me, the ld. AR of the assessee while making her submission vehemently contended that the assessee has good case on merit as the revenue has taxed the same cash credit in the hands of assessee’s husband as well. The ld. AR also submitted that the assessment relates to A.Y. 2011-12, reopened in 2018 and completed on 03/10/2018. The assessee made sincere efforts or collecting evidence and that the impugned bank account is a joint account. I find merit in the submission of ld. AR of the assessee. Though, admittedly, there was delay of 140 days and the assessee to substantiate the cause of delay, filed her affidavit explaining the cause of delay that the delay occurred due to collecting document from the bankers and other material. The ld. AR of the assessee also while making her submission submitted that there was no intentional or deliberate delay in filing appeal, the delay occurred only for the reasons that the assessee was collecting evidence from various government agencies like banks and revenue records from State Revenue Department. Considering the plea of assessee, I am of the view that there was no intentional or deliberate delay in filing appeal. The assessee will not get any benefit in filing appeal belatedly rather there is always chance that the delay may not be condoned, which ultimately held by the ld. CIT(A). Considering the fact that when technical consideration and cause of substantial justice are pitted against each other, the cause of substantial justice may be preferred.
Jayshreeben Nilamkumar Desai Vs ITO 7. The ld. Sr. DR for the revenue relied on the decision of Hon'ble Apex Court in Hon'ble Apex Court in Civil Appeal No.7696 of 2021 in the case of Majji Sannemma @ Sanyasirao Vs Reddy Sridevi & Ors. With utmost regard the ratio of the said decision, I find that in that case, there in no finding of High Court that there was any sufficient cause explaining the huge delay of 1011 days. However, in the present appeal there is delay of about 140 days and the assessee has categorically contended that the delay in filing appeal is not intentional or deliberate but for the reasons explained in the affidavit of assessee, which in my view is reasonable one. Thus, in view of the above factual and legal position, the delay in filing appeal before the ld. CIT(A) is condoned. I also noted that the assessee has filed the assessment order in case of her husband wherein the same addition with regard to cash credit in joint bank account has been made.
It is settled legal position under law that the same income cannot be taxed twice. Therefore, the appeal of assessee is restored back to the file of ld. CIT(A) to decide the appeal on merit. The ld. CIT(A) is also directed to consider the additional evidence which was filed by assessee on record.
The assessee is also given liberty to file and other relevant and material evidence to substantiate her claim. With this observation, the grounds of appeal of assessee is allowed for statistical purposes.
Jayshreeben Nilamkumar Desai Vs ITO 10. In the result, the appeal of the assessee is allowed for statistical purpose. Order announced in open court on 17th April 2023 at the time of hearing.