ERSTWHILE ACHIEVER'S INTERNATIONAL,NEW DELHI vs. ITO WARD 34(5), NEW DELHI

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ITA 2063/DEL/2023Status: DisposedITAT Delhi20 November 2023AY 2012-13Bench: SH. SHAMIM YAHYA (Accountant Member), SHRI KUL BHARAT (Judicial Member)3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the assessee did not provide proper compliance before the AO and CIT(A), leading to ex-parte orders. However, it was observed that the CIT(A)'s order did not clearly indicate if the assessee was given a proper opportunity to present their case.

What were the facts?

The assessee's appeal concerns reassessment proceedings initiated based on an investigation wing report. The Assessing Officer (AO) noted significant bank credit entries and made additions as income from undisclosed sources due to non-compliance by the assessee. The CIT(A) upheld the AO's order.

What were the issues?

Whether reassessment proceedings were validly initiated without independent inquiry and whether the assessee was denied a proper opportunity of being heard.

Which sections of the Income-tax Act were involved?

Section 147,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘B’, NEW DELHI

For Respondent: Shri Vivek Kumar Upadhyay, Sr. D.R
Hearing: 16.11.2023Pronounced: 20.11.2023

This appeal filed by the assessee is directed against the order of Learned Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre (NFAC) - Delhi dated 22.05.2023 pertaining to Assessment Year 2012-13.

2.

The grounds of appeal

filed by assessee, which reads as under: 1. “The Ld. Commissioner, Appeals (“CIT-A”) was not justified in confirming the initiation of the firm's reassessment proceedings by the Ld. AO, based on the report of the Investigation Wing, New Delhi, without conducting an independent enquiry before recording satisfaction and the reasons to believe that income had escaped assessment and also on the basis of permission of the higher authority which was granted on dotted lines in a mechanical manner without proper application of mind.

2. The Ld. CIT-A was not justified in confirming the impugned assessment order under section 147 read with section 144 without appreciating the fact that the firm in question had been dissolved vide dissolution deed dated 01.04.2010 and was, therefore, not in Erstwhile Achiever’s International vs. ITO 2 existence at the time of issuance of notice and that any notice issued to a non-existent assessee was void ab-initio

3. Without prejudice, the Ld. CIT-A was not justified in making an addition of Rs. 8,53,36,625/- being loan received during the year, as cash credit ignoring the submissions of the appellant and the evidence produced during the course of the assessment proceedings in support of the identity and creditworthiness of the lender and the genuineness of the transactions.

4. The Ld. CIT (A) was not justified in rejecting the appeal of the appellant and confirming the action of the Ld. AO in passing the impugned assessment order, without providing an opportunity of being heard in the matter in both cases, which is against the principles of natural justice. 5. The appellant craves leave to add, alter, amend, modify and delete any grounds of appeal.”

3.

In this case, the assessment was reopened and assessment order was passed under section 147 r.w.s 144 of the Income-tax Act, 1961. During the assessment, the AO noted that the assessee has huge bank credit entries as follows: Name of the Bank account F.Y. Total Credits account holder no. M/s. Achievers 100405000158 2011-12 Rs.8,53,36,625/- International

4.

The Assessing Officer made enquires but proper compliance was not done. Hence, AO held the sum as income from undisclosed sources for the assessee. Upon assessee’s appeal, learned CIT(A) also noted that no compliance has been done. Hence, he confirmed the AO’s order. Against this order, assessee is in appeal before us.

5.

We have heard learned DR. None appeared on behalf of the assessee despite notice. Upon careful consideration, we find that it is correct that no Erstwhile Achiever’s International vs. ITO 3 compliance has been done by the assessee before the AO and CIT(A) which has resulted in exparte orders at both the levels. A perusal of the learned CIT(A)’s order shows that there is no mention that the assessee was given an opportunity to canvas the case properly. Accordingly, in the interest of justice, we remit this issue to the file of learned CIT(A). The learned CIT(A) is directed to consider the issue afresh after giving the assessee proper opportunity of being heard.

6.

Learned DR did not have any objection to the above proposition.

7.

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

Order pronounced in the open court on 20.11.2023

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