THE INDIAN MISSIONARY MOVEMENT,KAWARDHA vs. INCOME TAX OFFICER, WARD- KAWARDHA, KAWARDHA

The grounds of appeal raised by the assessee are as under: 1. In the facts of the case, the addition of Rs. 15,34,950/- made by the AO invoking provisions of sec. 69A and confirmed by Ld. CIT(A) is itself illegal, arbitrary, and not justified. Provisions of sec. 69A are not applicable in the case of appellant.

At the very beginning of the hearing in the present case, the registry has pointed out that the appeal has been filed with a delay of 13 days. Ld. AR of the assessee, explaining the reason for delay has submitted that an application requesting the condonation of delay together with an affidavit was filed by the assessee a/w appeal memo. On perusal of the said request for condonation of delay, it has been observed that the assessee was unable to discuss the matter with his counsel as the earlier counsel of the assessee was stuck up in time barring tax audit work and filing of returns. Assessee has appointed a new counsel and therefore, causing a delay of 13 days in preparing and filing the appeal before the tribunal. Considering the request of the assessee and reasonableness of explanations furnished before us, the delay on account of sufficient cause

The brief facts of the case are that the assessee is an educational institution, which has failed in furnishing the income tax return for the assessment year 2017-18. On the basis of data analytics and information gathered during the phase of online verification under “Operation Clean Money”, the Income Tax Department gathered a list of assessee’s who had deposited substantial cash in bank account during the demonetisation period (09.11.2016-30.12.2016), but have not filed income tax return for the assessment year 2017-18. The data reveals that the assessee has also deposited substantial cash in its bank account during the demonetisation period. The case of the assessee was picked-up for scrutiny assessment, notice u/s 142(1) dated 09.02.2018 was issued. During the course of e-proceedings, various statutory notices were issued, but the assessee remained non-compliant. On the basis of such non-compliance on the part of assessee, Ld. AO had prepared a table of such notices was furnished by the Ld.AO in the assessment order the same is extracted as under:

With respect to a question issued by the department dated 31.08.2019, a reply was filed by the assessee addressed to JCIT Range-2 and the same was placed on records. In reply, the president of the assessee society Shri Poster Jose Thomas stated that, the assessee is registered samiti and is running a school in the name of ‘The Holy Kingdom Higher Secondary School’ at Kawardha. Regarding cash deposit in Bank A/c 141200301110004, it is submitted that, the impugned deposits were fee deposited by the student of the school. It is further submitted that as per provision of Section 10(23C)(iiiad) of the Income Tax Act in computing the total income of previous year of any person on behalf of any university or other educational institutions existing solely for educational purposes and not for purposes of profit if the aggregate annual receipt of such university or educational institution do not exceed the amount of Rs. 1 crore, it is explained that Assessee’s organization is not required to take registration u/s 12A being their gross receipts was less then Rs. 1 crore.

A final show cause notice dated 05.12.2019 was issued and served upon the assessee proposing to pass best judgment assessment u/s 144 of the Act and determine the sum payable by the assessee on the basis of material evidence collected during the course of assessment proceedings. No submissions in respect to the show cause notice was filed by the assessee the assessee was completed u/s 144 and the amount of Rs. 15,34,950/- was added as deemed income u/s 69A of the Income Tax Act. Aggrieved by the order of Ld. AO, assessee preferred an appeal before the Ld. CIT(A)’s but the assessee was again acted lackadaisically continuing with its non-acquiescent behaviour before the Ld. CIT(A) also. Such conduct of the assessee is evident from the statement of opportunities offered by the CIT(A) but not availed by the assessee, the same is extracted as under:

Accordingly, the appeal of the assessee, was dismissed by the Ld. CIT(A)’s, on the basis of statement of facts and other relevant material available with him, approving the observations of the Ld. AO, in absence

Dissatisfied with the decision of the Ld. CIT(A), the assessee has preferred the present appeal before us.

At the outset, Ld. AR on behalf of the assessee has submitted a return submission the same is extracted as under:

Ld. AR further submitted before us a request for admission of additional evidence under rule 29 of the ITAT Rules, 1963. The same is extracted as under:

Looking to a nature of additional evidence submitted before us and the reasons as explained by Ld. AR that the notices u/s 250 were sent by the office of Ld. CIT(A) to the address, which is not pertaining to the appellant, further there was an error by the counsel of the assessee while filing form 35 before the Ld. CIT(A). It is clarified that the assessee was prevented by reasonable cause on account of which the assessee was unaware about the notices issued and, therefore, could not attended the hearings fixed by the Ld. CIT(A). Ld. AR further advanced the argument that the Ld. CIT(A) ought not have summarily dismissed the appeal merely because of the non-appearance of the appellant. The ex-parte order ought to have been passed on merits discussing the detailed SOF filed a/w the memo of appeal and the submissions at assessment stage. Reliance was placed on decision of the ITAT, Raipur bench in the case of

Ld. Sr DR on the other hand, has vehemently supported orders of Ld. AO and Ld. CIT(A).

We have considered the rival submission, perused the material available on record and the case laws preferred by the assessee. On the factual matrix of the present case, it is evident that the assessee has not furnished the necessary details before Ld. AO or Ld. CIT(A), however, certain additional evidence, which were not made available during the assessment proceedings and appellate proceedings before the authorities below, referred to supra were submitted before us, which are vital for deciding issue logically, but after examination and analysis. We, therefore, in the interest of natural justice, respectfully following the order of ITAT, Raipur, in the case of Vishnu Kumar Sinha (Supra), are of the considered opinion that for verification of the additional evidences and decide the issues on merits by the Ld. CIT(A), The matter in all fairness to the restored back to the file of Ld. CIT(A), accordingly the order of Ld. CIT(A) is set aside, and the issues are restored to the file of Ld. CIT(A) for re- adjudication of the same afresh.

Since, we have set aside the order of Ld. CIT(A) for non- prosecution, we refrain ourselves to deal with the merits of the case. Needless to say, that the Ld. CIT(A) shall afford a reasonable opportunity of being heard to the assessee in the course of de novo appellate proceedings. The grounds of appeal raised by the assessee are thus, disposed-off in terms of our aforesaid observations.

In the result appeal for the assessee is allowed for statistical purposes, in terms of our observations.