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Income Tax Appellate Tribunal, MUMBAI BENCHES “D”, MUMBAI
Before: SHRI B.R.BASKARAN (AM) & SHRI RAM LAL NEGI (JM)
This appeal has been filed by the assessee against order dt. 22/02/2013 passed by the Ld. CIT(Appeals)-29, Mumbai for the Asst. year 2001-02.
Brief facts of the case are that the assessee, proprietor of three concerns, filed its return of income for the Asst. year 2001-02 declaring the total income of Rs. 1,98,937/-. The AO completed the assessment proceedings and passed the assessment order determining the total income at Rs.2,50.700/-. Subsequently, the assessment order was revised u/s 263 of the Income Tax Act, 1961 (in short ‘the Act’) and in terms of revisional order passed by the CIT, the Assessing Officer issued notices to the assessee on different dates and sought explanation, In response thereof, the assessee only got filed letter of authority. Ultimately, the AO passed exparte order u/s 144 of the Act and made additions of Rs. 4,05,000/- to the income of the assessee as unexplained cash deposits and also disallowed Rs. 37,852/- out of telephone and motor car expenses and Rs. 25,323/- out of office, conveyance, staff and welfare expenses.
3. The assessee challenged the assessment order before the Ld. CIT(A). During appellate proceedings the assessee claimed that an amount Rs. 2,10,000/-was withdrawn from Bank account of his partnership firm and submitted the copy of statement of account of the M/s Moulic Infotech in support of his claim. For the balance amount, it was contended that an amount Rs. 1,00,000/-was withdrawn from the same bank account and the remaining amount was out of cash sales reflected in the profit and loss account. Since the said details/ explanations were not filed before the AO, the then CIT(A) sought remand report from the assessing officer. In response thereof remand report dt. 18/12/2008 was submitted by the AO. Since in the report the AO has only mentioned details of notices and reminders sent to the assessee and non compliance thereof by the assessee during the original assessment proceedings, the CIT further directed the AO to submit fresh report after verifying the evidence produced by the assessee. Against the AO submitted the remand report reproducing the contents of earlier report without conducting any verification. The assessee then requested the CIT either to verify the evidence himself or to direct the AO to do the needful. However, the Ld. CIT(A) dismissed the appeal on the basis of material placed before him observing that neither the AO has made any effort to verify explanation of the appellant nor the appellant is serious about pursuing his case. The assessee is in appeal before the Tribunal against the impugned order passed by the Ld.CIT(A). The assessee has challenged the impugned order on the following grounds;
“1. The learned CIT(A) has erred in stating that the appellant is not serious about pursuing his case, inspite of without appreciating the facts of the case in the right perspective.
2. The learned CIT(A) has erred in confirming the addition of Rs. 3, 75, 000/- on account of cash deposit u/s 68 of the Income Tax Act, 1961.
Further, the learned CIT(A) has erred in confirming addition of Rs. 12, 661/- which is 10% of Total Telephone Expenses, Motor Car Expenses and Depreciation on car without appreciating the facts of the case in the right perspective.”
Since the assessee has filed application for condonation of delay of one day in filing the present appeal on the ground that due to illness the assessee could not handover the documents to the representative supported by an affidavit, the Ld. AR submitted that the delay has been caused due to the circumstances beyond control, therefore, the application may be allowed. After hearing the Ld. DR we allowed the application in the interest of natural justice and allowed the ld. AR to argue the case on merits.
At the outset, the Ld. AR submitted that the amount in question has been reflected in the books of account and the submissions made by the assessee was not considered either by the Assessing Officer or by the CIT(A). Comparison of two remand reports dt.18/12/2008 and 23/09/2011 show that the AO did not verify the additional evidence produced by the assessee before the ld. CIT(A) despite the specific directions issued by the ld. CIT(A). We also noticed that remand report dt. 23/09/2011 is the replica of the first remand report dt. 18/12/2008. This fact reveals that the AO did not bother to verify the evidence in compliance of the orders of the CIT(A). On the other hand the CIT(A) has decided the appeal on the basis of the material placed before him. The ld. DR however, relying on the concurrent orders passed by the authorities below submitted that there is no scope for interference in order passed by the Ld CIT(A).
In view of the aforesaid facts and circumstances of the case, we are of the considered opinion that the contention of the assessee is required to be examined by the Assessing Officer in the light of the additional evidence produced by him. However, since the assessee did not appear and co-operate with the Assessing Officer during the initial assessment proceedings, we impose a cost of Rs. 3000/- on the assessee, and subject to the payment of the cost to the revenue before 23/3/2016, set aside the impugned order passed by the Ld. CIT(A) and restore the matter to the AO with the direction to pass assessment order afresh, after giving proper opportunity of being heard to the assessee and verifying the additional evidence produced before the ld. CIT(A).
Accordingly, appeal filed by the assessee for the A.Y. 2001-02 is allowed for the statistical purpose.
Order pronounced in the open court on 7th March, 2016