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Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL
O R D E R
PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated 23.11.2023 for Assessment Year 2012-13. 2. The Assessee has taken the following grounds of appeal:-
“1. The order passed by the Ld. CIT(A) is against law, equity & justice.
The Ld. CIT(A) has erred in law and on facts in dismissing appeal filed delay and not condone for delay.
The CIT(A) has erred in law and on facts in not adjusting for addition made by the Ld. A.O. of cash deposits and other credit amount of Rs. 58,79,197/- U/S. 69A of the Act as unexplained money.
The CIT(A) has erred in law and facts in not adjusting for addition made by the Ld. A.O. of Rs. 6664/- as interest income. Ramilaben Dineshbhai Mordiya vs. ITO Asst.Year –2012-13 - 2– 5. The appellant Craves liberty to add, amend, alter or modify all or any grounds of appeal
before final appeal.”
3. The brief facts of the case are that during the assessment year 2012-13, the Department observed that the assessee had made a cash deposit of Rs. 27,40,500/- in it’s savings bank account (No. 30658618914) at State Bank of India. The Assessing Officer reopened the case of the assessee under Section 147 of the Act and a notice under Section 148 was issued on March 22, 2019, to which there was no response from the side of the assessee. Subsequently, on October 7, 2019, another notice under Section 142(1) of the Act was issued, asking the assessee to furnish details regarding the source of the cash deposits, but again, the assessee did not comply. During the reassessment proceedings, the Assessing Officer noted that the savings bank statement showed total credit entries of Rs. 58,79,197/- which included the cash deposits. Since the assessee failed to file a return of income for the assessment year, these entries remained unexplained, along with unreported interest income of Rs. 6,664/-. Given the lack of response, the Assessing Officer issued another show-cause notice on November 5, 2019, asking the assessee to explain why the assessment should not be finalized under Section 144 of the Act and why the cash deposits should not be treated as unexplained income under Section 69A of the Act. The assessee failed to provide any satisfactory explanation. As a result, the total credit of Rs. 58,79,197/- was deemed unexplained under Section 69A by the Assessing Officer and the same was added to the total income of the assessee. Additionally, the unreported interest income of Rs. 6,664/- was also added to the income of the assessee. Penalty proceedings were initiated under Section 271(1)(c) for concealing particulars of income.
4. In appeal, Ld. CIT(Appeals) observed that the assessee received an order under Section 144 read with Section 147 of the Income Tax Act on Ramilaben Dineshbhai Mordiya vs. ITO Asst.Year –2012-13 - 3– February 22, 2020, from the assessing officer. The assessee contended that this notice was not physically received, as she resides in her maternal in-laws' house and at her parents' home. The assessee, a widow, had not filed return of income for the assessment year 2012-13, claiming her income was not chargeable to tax. She submitted that her income was derived from agricultural activities, for which she received an advance for the sale of agricultural land. However, the land was not sold during the relevant accounting year, and she had cash accumulated from agricultural income, which was deposited into her bank account. Accordingly, the assessee submitted that the AO incorrectly added all credit entries in the bank account totalling Rs. 58,79,197/- and assessed these as income under Section 69A, without conducting proper inquiries with the assessee. The assessee submitted that she had substantial evidence supporting the nature of these deposits, including withdrawals and subsequent re-deposits, as well as funds deposited on behalf of her children. The agricultural land in question belonged to her late husband, who passed away on November 2, 2008, and the land was inherited by his legal heirs, including the assessee and her children. The assessee stated that savings were made from exempt agricultural income to prepare for her elder daughter’s upcoming marriage on December 7, 2012, and further submitted that the deposits were capital receipts rather than taxable income. The AO's assessment, which categorized all credit entries as income of the assessee without considering the amounts withdrawn and re-deposited, was deemed erroneous. The assessee requested that the addition of Rs. 59,24,051/- be deleted and that the resulting interest charges be reassessed, arguing that there was no willful default on her part since she had not received the requisite notices. Ramilaben Dineshbhai Mordiya vs. ITO Asst.Year –2012-13 - 4– 5. During the appellate proceedings, notices were issued on January 11, 2021, and subsequently on October 2, 2023, for hearings set for October 11 and October 25, 2023. However, no responses were received from the assessee throughout the appeal process. Ld. CIT(Appeals) noted that the assessee claimed to have received the assessment order copy on February 22, 2020, approximately three months after the order was issued on November 26, 2019. Ld. CIT(Appeals) found this timeline improbable and observed that the assessee failed to provide evidence to support her claim of delayed receipt of the assessment order. According to Section 249(2) of the Income Tax Act, appeals must be filed within 30 days of order receipt, and the appellate authority may condone delays under Section 249(3) if sufficient cause is shown. However, the assessee did not establish any sufficient cause for the delay in filing her appeal. The principle of “sufficient cause” is a factual determination, and the burden of proof lies with the assessee to show reasons for the delay, which she failed to do. Accordingly, after careful consideration of the facts and applicable judicial principles, Ld. CIT(Appeals) concluded that the assessee did not provide sufficient and reasonable justification for the delay in filing the appeal. Consequently, the appeal was dismissed as barred by limitation.
The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(Appeals) dismissing the appeal of the assessee as being barred by limitation. The counsel for the assessee reiterated the facts and submissions which were taken before Ld. CIT(Appeals) and submitted that if given an opportunity, the assessee was in a position to explain the source of cash deposits in the bank account, during the impugned year under consideration. The counsel for the assessee submitted that there was lack of opportunity Ramilaben Dineshbhai Mordiya vs. ITO Asst.Year –2012-13 - 5– provided to the assessee to present the case on merits, and sought for one more opportunity to substantiate the source of deposits made by the assessee in his bank account. In response, DR placed reliance on the observations made by the Ld. CIT(Appeals) and the assessing officer in their respective orders. The DR submitted before us that the assessee had been all throughout non-compliant and therefore, there is no infirmity in the order of Ld. CIT(Appeals) so as to call for any interference.
We have heard the rival contentions and perused the material on record. On going to the facts of the case, the submissions placed before us by the counsel for the assessee, in the interest of justice, the matter is being restored to the file of Ld. CIT(Appeals) for de novo consideration. However, we also observe that the assessee has all throughout been non-compliant and has consistently not been responding to the notices issued by the Department on various dates. Accordingly, a nominal cost of ₹ 2000/- is being imposed on the assessee and the same may be deposited in the Prime Minister’s relief fund. Further, in case it is found that the assessee still continues to remain non- compliant, then the Ld. CIT(Appeals) would be at liberty to pass order on the basis of materials available on record, in accordance with law.