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Income Tax Appellate Tribunal, LUCKNOW BENCH ‘SMC’ LUCKNOW
Before: SHRI SUDHANSHU SRIVASTAVA
This appeal has been preferred by the assessee against the order dated 30.08.2023 passed by the National Faceless Appeal Centre (NFAC), Delhi for Assessment Year (AY) 2017-18 wherein, the assessee’s appeal has been dismissed in limine for the reason of non compliance.
The brief facts of the case are that the assessee had filed his return of income declaring business income at Rs.4,01,540/-. The assessee’s case was selected for scrutiny through CASS.
Subsequently, the assessment was completed at a total income of Rs.42,28,192/- after making addition of Rs.13,58,500/- u/s. 69A of the Income Tax Act, 1961 (hereinafter called the ‘Act’) and Rs.28,69,692/- under the head income from business and profession.
Aggrieved, the assessee preferred an appeal before the ld. First Appellate Authority. However, in spite of numerous opportunities, as enumerated in the appellate order, no response was forthcoming from the side of the assessee and the assessee’s appeal came to be dismissed in limine by the ld. First Appellate Authority.
Now, the assessee has approached this Tribunal challenging the dismissal of his appeal by the NFAC by raising the following grounds of appeal: “1. On the facts and circumstances of the case, the order passed by the National Faceless Appeal Centre (NFAC), Delhi u/s 250 of the Act is bad both in the eye of law and on facts.
2. On the facts and in the circumstances of the case and in law, NFAC has erred in passing the Ex-parte order. The NFAC has not followed the Rules of natural justice.
3. On the facts and in the circumstances of the case and in law, the NFAC erred in dismissing the appeal filed by the assessee on the grounds of non-compliance by the assessee and without verifying the facts of the case. The assessee, therefore, prays that the impugned order be set aside.
4. On the facts and in the circumstances of the case and in law, NFAC has erred in deciding the appeal Ex-parte without deciding the appeal on merits as laid down in CIT v. S. Chennaiappa Mudaliar (1969) SC (591) and Balaji Steel Re-rolling Mills V. Commissioner Excise & Customs (2014) 52 taxmann.com 107 (SC) case.
5. On the facts and circumstances of the case, the NFAC made an error in upholding an addition of Rs. 13,58,500/- under section 69A of the Act. The NFAC failed to appreciate that the cash deposited by the assessee in their bank account was obtained from the cash in hand that had accumulated through their regular business activities.
6. The NFAC has erred in confirming addition u/s 69A of the Act without appreciating that provisions of Section 69A are not applicable in the facts and circumstances of the case.
7. The NFAC has erred in law and on facts in upholding the provision of section 1158BE of the Act.
8. On the facts and circumstances of the case and in law, the NFAC has erred in upholding an addition of Rs. 28 ,69,692/. as income under the head income from business and profession. The NFAC has arbitrarily considered 8 per cent of the total bank receipts as a turnover of the assessee without appreciating that the assessee has already declared higher turnover including bank receipts and paid due taxes accordingly.
9. That the above addition of Rs. Rs. 28,69,692/- has been confirmed by the NFAC capriciously, without verifying the material available on the e-filing portal under the assessee's PAN.
10. The appellant craves leave to add, amend or alter any of the grounds of.”
The ld. AR prayed that the assessee’s appeal may be restored to the file of the NFAC for the purpose of adjudication on merits.
Since the order passed by NFAC was an ex-parte order, the ld. Senior D.R. had no objection to the restoration of appeal to the NFAC. 7. I have heard both the parties and have also perused the material on record. It is evident that there was complete non compliance on the part of the assessee during the course of first appellate proceedings. However, looking into the facts of this case, I am of the considered view that the assessee deserves one more opportunity to present his case and, therefore, in the interest of substantial justice, I restore this file to the Office of the NFAC with the direction to provide one more opportunity to the assessee to present his case and I also caution the assessee to fully comply with the directions of the NFAC in the set-aside proceedings when called upon to do so, failing which, the NFAC shall be at complete liberty to pass the order in accordance with law, based on material available on record even if it is ex-parte qua the assessee.
In the result, the appeal of the assessee stands allowed for statistical purposes.
(Order pronounced in the open court on 29/04/2024)