VIRENDER SINGH, ADVOCATE,ASALATPUR vs. ITO, WARD 2(2)(5), GHAZIABAD

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ITA 1126/DEL/2023Status: DisposedITAT Delhi11 September 2023AY 2012-13Bench: SHRI C.M. GARG (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)5 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) order was passed ex parte without providing adequate opportunity to the assessee. Since the penalty is consequential to the assessment order, which is also pending appeal, the matter was remitted back to the CIT(A).

What were the facts?

The assessee deposited cash of Rs. 11,19,000 in a savings bank account, which was treated as unexplained income and added to his total income. Subsequently, a penalty under Section 271(1)(c) was imposed. The assessee appealed against the penalty order, but the appeal was dismissed ex parte by the CIT(A) due to non-compliance.

What were the issues?

Whether the penalty order was passed in violation of principles of natural justice and if the penalty appeal should be adjudicated after the quantum appeal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 144,Section 147,Section 69

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH :G: DELHI

Before: SHRI C.M. GARG & SHRI GIRISH AGRAWAL

For Appellant: Shri Dinesh Kumar, Adv
For Respondent: Shri Anuj Garg –SR. DR
Hearing: 11.09.2023Pronounced: 11.09.2023

O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of learned Commissioner of Income-tax (Appeals), Delhi, Appeal No. NFAC/2011- 12/10070049 dated 23.02.2023 against the order under Section 271(1)(c) of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) dated 13.12.2021 passed by ITO, Ward-2(2)(5), Ghaziabad for the assessment year 2012-13.

2.

The main bone of contention by the assessee in the present appeal is in respect of insufficient opportunity provided to the assessee violating

Virender Singh, Adv., Asalatpur- AY: 2012-13 the principles of natural justice to represent the case before the first appellate authority. Assessee has also raised the ground that quantum appeal against the order is pending for disposal before the first appellate authority, yet penalty order under Section 271(1)(c) imposing a penalty of Rs.1,93,331 has been confirmed against which assessee is in appeal before the Tribunal.

3.

Brief facts of the case are that assessee has deposited cash of Rs.11,19,000 in a Saving Bank Account maintained with Bank of Baroda, Ghaziabad which has been treated as unexplained and undisclosed income and added while completing the assessment under Section 144/147 of the Act. The addition was made under Section 69 of the Act. Assessee has preferred an appeal against this quantum addition before the learned Commissioner of Income-Tax(Appeals) which is pending for disposal as on date.

4.

Consequent to this addition, penalty proceedings under Section 271(1)(c) was initiated for concealment of income. Penalty order was passed on 31.12.2021 imposing a penalty of Rs.1,93,331. Assessee filed the appeal against this penalty order before the learned Commissioner of Income-Tax(Appeals) on 08.01.2022. In the order passed by learned Commissioner of Income-Tax(Appeals) against the penalty order, it is noted that various notices were issued to the assessee but no compliance

Virender Singh, Adv., Asalatpur- AY: 2012-13 or any submission was made thereupon. Last notice was issued on 13.02.2023 fixing the date of hearing on 20.02.2023. Since, this remained not complied, learned Commissioner of Income-Tax(Appeals) proceeded to dispose of the appeal by taking into consideration statement of facts as the written submission and confirmed the penalty so imposed.

5.

Before us, learned counsel for the assessee contended that assessee could not appear and file his submissions on the date of hearing fixed for 20.02.2023 due to his illness as he was advised for rest during that time. Learned counsel placed on record a copy of medical certificate to substantiate his contention. According to the learned counsel, order passed by learned Commissioner of Income-Tax(Appeals) is an ex parte order qua the assessee dated 23.02.2023 without giving adequate opportunity of hearing.

5.1 Learned counsel also submitted that assessee is already in appeal before the first appellate authority against the quantum order passed under Section 144/147 and is pending for disposal. He, thus, requested that the present appeal be also remanded back to the file of learned Commissioner of Income-Tax(Appeals) which may be disposed of once the appeal against the assessment order is adjudicated upon. Till then, imposition of penalty be kept in abeyance.

Virender Singh, Adv., Asalatpur- AY: 2012-13 6. On confrontation of this submission to the Senior DR, he did not object on the prayer made by the learned counsel.

7.

Considering the facts on record and circumstances of the case as discussed above, we find it proper to remit the matter back to the file of the learned Commissioner of Income-Tax(Appeals) with the direction that this may be disposed of after adjudication on the appeal against the assessment order since imposition of penalty is consequent to determination of assessed total income. We also direct the assessee to be diligent in attending the hearing fixed by the first appellate authority.

Accordingly, grounds taken by the assessee are allowed for statistical purposes.

In the result, appeal of the assessee is allowed for statistical 8. purposes.

Order is pronounced in the open court on 11.09.2023.

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