MR. HASMUKHLAL MAVJIBHAI THAKKAR( PROP. OF M/S. NAVKAR POTEINS),DEESA vs. THE INCOME TAX OFFICER, WAD-2, PALANPUR

The assessee has raised the following grounds of appeal :-

The Lrd. Commissioner of Income Tax (E-Appeals) has erred in law in passing the appeal order confirming the action of Income Tax Officer, Ward-2, whereby confirmed the addition of Rs.1,26,08,950/- made on account of cash deposited in the bank account maintained with HDFC Bank under the IT Act.

The Lrd. Commissioner of Income Tax (E-Appeals) (Hereinafter referred to as "Assessing Officer") has confirmed the action of Income Tax Officer, Ward-2 who has passed the ex-parte best judgment assessment order u/s. 144 of the Income Tax Act for A.Y. 2017-18 on 23/11/2019 which was received by the appellant on 02/12/2019. In the assessment Order the Lrd. Assessing Officer has raised huge demand of Rs.1,36,44,760/-. The entire ex-parte best judgment assessment order passed by the Assessing Officer is deserves to be quashed and set aside.

The Lrd. Assessing Officer has made addition u/s. 68 for cash deposited of Rs.1,26,08,950/- during the year under consideration in the assessment order and changed tax at special rate u/s. 115BBE of the Income Tax Act. The cash deposited was from the cash balance available in the cash book.

The Lrd. Assessing Officer has not taken into consideration the return of income filed by the appellant and facts and merits of the case and passed the ex-parte best judgment assessment order u/s.144 of the Income Tax Act. The entire addition made are unwarranted and bad in law.

The Lrd. Assessing Officer has not issued show cause notice before passing the high pitched assessment order and no proper opportunity of being beard was given to the appellant. Hence, the entire assessment order is in the gross violation of principle of natural justice.

The Lrd. Assessing Officer has erred in law in applying the provision of Section 68 for cash deposited of Rs.1,26,08,950/-. In fact the cash deposited are from the recorded transactions and cash available in the cash book and from the income offered for taxation. Therefore, applying provision of section 68 & 115BBE is highly unjustifiable and unlawful.

The Lrd. Assessing Officer has erred in law in charging interest u/s.234A-B-C-D of the Income Tax Act on the consequential demand raised in the assessment order.

The Lrd. Assessing Officer has erred in law in initiating penalty proceedings u/s. 270A & 272A(1)(d) of the Income Tax Act

The Lrd. Assessing Officer has grievously erred in law in applying the provision of section 115BBE of the Income Tax Act which was not in force. In absence of express enactment or necessary intendment, the

The appellant craves leave to add, alter or amend any of the grounds of appeal either before or at the time of hearing of the appeal.

The order passed by the appellate authority dismissing the appeal of the appellant on the ground of non-compliance may please be quashed and set aside and appeal may be heard on merits based on documents, and evidences.

The ex-parte best judgment assessment order passed us.144 r.w.s. 143(3) of the Income Tax Act deserves to be quashed and set aside.

Addition of Rs.1,26,08,950/- made u/s.68 applying the provision, may kindly be deleted.

A special rate of taxation u/s115BBE applied for addition made in the assessment order may kindly be deleted as the same is against the provision of the Act.

The assessment order may kindly be considered as passed with gross violation of principle of natural justice.

Cash deposited prior to the period of demonetisation may please be verified and considered.

The book results and books of account may kindly be accepted.

Consequential interest charged u/s. 234 may kindly be reduced/deleted.

Initiation of penalty proceedings may kindly be directed to be dropped.

Stay against recovery of demand may please be granted.

Delay caused in filing the appeal may please be condoned.”

Return of income was filed on 31.03.2018 declaring total income of Rs.3,29,670/-. The said return was processed under Section 143(1) of the Income Tax Act, 1961. The case was selected for scrutiny and notice under Section 143(2) of the Act dated 11.08.2018 was issued online. Notices under Section 142(1) of the Act dated 07.01.2019, 28.01.2019, 13.06.2019, 28.10.2019 and 07.11.2019 were issued online. During the year under consideration, the assessee disclosed income under

Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.

The Ld. AR submitted that there is a delay of 28 days in filing the present appeal for which the assessee has filed condonation of delay application thereby explaining that the Tax Consultant of the assessee has not filed the appeal for almost nine months and delay was not on the part of the assessee but because of his earlier Consultant for which the assessee may not be held responsible. After going through the application for condonation of delay as well as the affidavit of the assessee, it appears that due to the default on the part of the Tax Consultant who has not informed the assessee whether the appeal was filed within the time or it was not filed, the assessee is dependent on the Tax Consultant for filing of the appeal as he a layman. Hence, the explanation offered by the assessee for delay in filing the appeal appears to be genuine and hence the delay is condoned. The Ld. AR submitted that as the assessee could not appear before the Assessing Officer as well as before the CIT(A) due to the fault on the part of the earlier Tax Consultant and the assessee at this juncture has filed the additional evidences, the matter may be remanded back to the file of the Assessing Officer for proper adjudication of the issues after verifying the evidences.

The Ld. DR submitted that despite granting several opportunities, the assessee was not prompt in following the proceedings from time to time and, therefore, the prayer should not be accepted for remanding back the matter. The Ld. DR relied upon the Assessment Order and the Order of the CIT(A).

We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee was not aware about the proceedings till the date of demand has been raised by the Department. The assessee though approached the Tax Consultant from time to time, however, because of the

In the result, appeal of the assessee is partly allowed for statistical purpose.