TAMMI RAJU VEGESNA,HYDERABAD vs. INCOME TAX OFFICER, WARD-2, AMALAPURAM

PER DUVVURU RL REDDY, Judicial Member :

This appeal filed by the assessee against the order of the Ld. CIT(A)-NFAC in DIN & Order No. ITBA/NFAC/S/250/2022- 23/1050800868(1), dated 15/3/2023 arising out of the order passed U/s. 143(3) of the Income Tax Act, 1961 [the Act] for the AY 2017-18.

2 2. Brief facts of the case are that the assessee is an individual

deriving income under the head ‘Salary / Pension’ has e-filed his

return of income for the AY 2017-18 on 05/08/2017 declaring an

annual income of Rs. 2,82,640/-. The case was selected for

scrutiny under CASS for limited scrutiny to verify the ‘cash

deposits during the demonetization period’. Accordingly, notice

U/s. 143(2) was issued and served on the assessee on

30/09/2018. Thereafter, notices U/s. 142(1) of the Act dated

14/2/2019 & 27/11/2019 calling for information along with

detailed questionnaire were served on the assessee. Vide para 2,

the Ld. AO observed that the assessee in his reply dated

24/09/2019 and 19/12/2019 submitted that he was a retired

professor of ANGR Agricultural University and getting pension

and income from agriculture. However, the assessee has not

offered any agricultural income for the FY 2016-17 in the return

of income filed nor furnished any corroborating documents in

support of his claim. The Ld. AO on perusal of the information

received from various bank(s) noted that the assessee made cash

deposits into his saving bank account with Union Bank of India,

Vedureswaram during the demonetization period to the tune of

Rs. 10,50,000/-. The Ld. AO observed in his order that though

the assessee was given several opportunities to explain the

3 sources for the said cash deposits with documentary evidence,

since the assessee has not complied with any of the notices

issued, the Ld. AO invoked the provisions of section 69A of the

Act and brought to tax the cash deposits amounting to Rs.

10,50,000/- as unexplained money. Thus, the Ld. AO determined

the assessed income at Rs. 13,32,640/-. Aggrieved by the order

of the Ld. AO, the assessee preferred an appeal before the Ld.

CIT(A).

assessee and sustained the addition made by the Ld. AO. While

dismissing the assessee’s appeal, the Ld. CIT(A)-NFAC observed

that till the date of passing of the order, the assessee neither

filed any response to the notices nor filed written submissions

and therefore, the Ld. CIT(A)-NFAC is left with no option but to

decide the case on the basis of the material available on record.

Aggrieved by the order of the Ld. CIT(A)-NFAC, the assessee is in

appeal before the Tribunal.

“1. The Ld. First Appellate Authority is not justified in deciding the appeal without affording appropriate opportunity to the appellant.

4 2. The Ld. First Appellate Authority is not justified in confirming the addition of Rs. 10,50,000/- as unexplained cash credit U/s. 69A made by the Ld. AO. 3. The Ld. First Appellate Authority is not justified in confirming the action of the Ld. AO in making the addition of Rs. 10,50,000/- U/s. 69A of the Act and bringing the same to tax U/s. 115BBE of the Act. 4. The Ld. First Appellate Authority failed to appreciate the fact that the appellant had sufficient sources to explain the deposits in bank account. 5. The appellant reserves his right to add, amend, delete or substantiate any ground or grounds during the course of the hearing.”

Ld. CIT (A) has passed ex-parte order without providing an opportunity to

the assessee of being heard. It was therefore pleaded that the matter

may be remitted back to the file of the Ld CIT (A) in order to provide one

more opportunity to the assessee of being heard. Ld. DR, on the other

hand, vehemently opposed to the submissions of the assessee and

submitted that sufficient opportunities had been provided to the assessee

however, on the given dates of hearing, neither the assessee responded to

the notices nor filed any written submissions before the Ld. CIT (A)-

NFAC. Therefore, the Ld. CIT (A)-NFAC had no other option but to pass

ex-parte order based on the materials available on record. Hence, it was

pleaded that the order passed by the Ld. CIT(A)-NFAC does not call for

any interference.

available on record and on perusing the submissions made before the

5 Tribunal by both the sides, I find that Ld. CIT (A)-NFAC had posted the case on several occasions. However, none appeared on behalf of the assessee before the CIT(A) on the dates of hearing. Therefore, the Ld. CIT (A) was left with no other option except to adjudicate the appeal ex-parte. In this situation, considering the nature of issue involved in the appeal, following the principles of natural justice, considering the prayer of the assessee as well as in the interest of justice, I hereby remit the matter back to the file of Ld. CIT (A)-NFAC in order to consider the appeal afresh on merits by providing one more opportunity to the assessee of being heard. At the same breath, I also hereby caution the assessee to promptly co-operate before the Ld. CIT (A)-NFAC in the proceedings failing which the Ld. CIT (A)-NFAC shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on the record. It is ordered accordingly.

Pronounced in the open Court on the 30th May, 2023.

Sd/- (दु�वू� आर.एल रे�डी) (DUVVURU RL REDDY) �या�यकसद�य/JUDICIAL MEMBER Dated :30/05/2023

6 OKK - SPS आदेश क� ��त�ल�प अ�े�षत/Copy of the order forwarded to:- �नधा�रती/ The Assessee– Tammi Raju Vegesna C/o. Katrapati & 1. Associates, 1-1-298/2/B/3, 1st Floor, Ashok Nagar, Street No.1, Hyderabad – 500 020. राज�व/The Revenue –Income Tax Officer, Ward-2, College Road, 2. Konkapalli Road, Amalapuram. 3. The Principal Commissioner of Income Tax, आयकर आयु�त (अपील)/ The Commissioner of Income Tax (Appeals), 4. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, �वशाखापटणम/ DR, ITAT, 5. Visakhapatnam गाड� फ़ाईल / Guard file 6.

आदेशानुसार / BY ORDER

Sr. Private Secretary ITAT, Visakhapatnam