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Income Tax Appellate Tribunal, DELHI BENCH “D”: NEW DELHI
Before: SHRI G.S. PANNU, HON’BLE & MS. ASTHA CHANDRA
O R D E R PER ASTHA CHANDRA, JM
The appeal filed by the assessee is directed against the order dated 28.10.2021 of the Ld. Commissioner of Income Tax (Appeals) – 43, New Delhi (“CIT(A)”) pertaining to Assessment Year (“AY”) 2011-12.
The assessee has raised the following grounds of appeal: “GROUND NO-1 That in its impugned order, the C1T (Appeals) has relied on the info— available with the Ld assessing officer and the passed impugned order ,s ma e whilst being erred by not having specifically addressed many important fact, GROIJND NO-2 That the appellant is an NRI based in Europe for many years now and that in the impugned period pertaining towards the assessment year of 2011-12 was coincidently in line with the appellants year of the VISA applications that the appellant was advised by the visa counselors to ensure that there is financial activity/ movement within the bank statement and the assessing officer failed in considering the same. GROUND NO.
3. That the appellant in absolute honesty to the Hon’ble CIT (Appeals) to comply with the required process also proceeding with the quashing of the assessment order, that the appellant has also complied and deposited the prerequisite amount of disputed tax. GROUND NO.
4. That the assessing officer was unable to consider that the appellant had also undertaken intraday transactions (speculative dealing without any physical delivery) in shares in equity market through Reiigare Securities Ltd. The CIT (Appeals) has absolutely erred in determining the facts that the appellant has actually incurred a loss of Rs. 91,287/- n its intraday trading, statement of Reiigare for the relevant financial year 2010-11. GROUND No-5 That in its impugned order the CIT (Appeals) has relied on information available with the assessing officer and has passed the order dismissing the appeal filed by the aggrieved assesse in the CIT (Appeals), without writing nor stating the points of determination said determination of the decision thereon as well as their reasoning to arrive at the said determination.”
The appeal is filed late by 206 days. The assessee filed petition for condonation of delay. The delay was caused due to serious illness of wife of the assessee duly supported by medical records of the hospital. The delay is condoned. The Ld. DR had no objection.
The case of the assessee was reopened under section 147 of the Income Tax Act, 1961 (“the Act”) as the assessee has not filed his return for AY 2011-12. The Department had the information that the assessee had made cash deposit of Rs. 19,59,000/- and had invested Rs. 5,80,980/- in Bombay Stock Exchange (BSE) during the previous year relevant to AY 2011-12. Statutory notice under section 148 of the Act was issued on 29.03.2018 and served in response to which it was submitted that he has no taxable income. Notice(s) under section 142(1) issued thereafter remained uncomplied with. The Ld. DCIT, International Taxation Circle (“AO”), 2 therefore, completed the assessment ex-parte under section 144/147 of the Act on total income of Rs. 25,30,980/- including therein Rs. 19,59,000/- being undisclosed cash deposit and Rs. 5,80,980/- being undisclosed investment in BSE.
Aggrieved, the assessee filed appeal before the Ld. CIT(A) and during the appellate proceeding made submission which is incorporated in para 4 of the appellate order. On consideration thereof, the Ld. CIT(A) observed in para 5.3 as under:-
5.3 The appellant is NRI is located in Spain. During the financial year the appellant was contemplating leaving India and shifting to Spain. The appellant was advised to ensure movement of funds in the bank statements. During the F.Y. the appellant also received gift of Rs. 5 lakh which was deposited in Bank account on 05.02.2011. In the assessment year 2010-11 the appellant’s income was below taxable limits so the return income was not filled by him.
However, the Ld. CIT(A) dismissed the appeal of the assessee by observing in para 5.6 of his appellate order as under:-
5.6 The appellant has submitted additional evidence in the form of affidavit of maternal aunt Smt. Jasbir Kaur, statement of bank account, cash flow statement, copy of account in the books of Religare securities. These additional evidence under Rule-46A in the IT rules were forwarded to the assessing officer for their comments on admissibility and also on merits. The comments have been received in this office on 07-10-2021. The Assessing Officer is of the view that the additional evidence filed under Rule-46A should be rejected as none of the conditions mentioned therein are satisfied and do not qualify to be admitted as per Rule-46A of Income tax Rules. The Assessing Officer while analyzing additional evidence on merits has commented that the affidavit of Smt. Jasbir Kaur reflects cash receipt and Rs.5 lakhs. However, no documentary evidence has been furnished to justify the credit worthiness of maternal aunt Smt. Jasbir Kaur. Further the appellant has also not provided any documentary evidence to explain source of income in share market and source of cash deposit in bank account. I agree with the opinion of the assessing officer that no documentary evidence to justify the creditworthiness of maternal aunt and source of deposits and investment has been provided by the appellant.
This has brought the assessee before the Tribunal and all the grounds of appeal relate thereto.
We have heard the Ld. Representative of the parties and perused the record. We observe that in exercise of powers vested in him under section 250 of the Act, the Ld. CIT(A) has admitted additional evidence as envisaged under Rule 46A of the Income Tax Rules, 1962. On the additional evidence so admitted, the Ld. CIT(A) obtained the comments of the Ld. AO and proceeded to decide the appeal on the basis of the Ld. AO’s comments. It is settled position of law that the principles of natural justice are applicable both for the assessee and the AO. There is no inkling in the appellate order that the assessee was confronted with the comments/report of the Ld. AO submitted to the Ld. CIT(A). In this view of the matter and in the interest of justice and fair play, we consider it expedient to remit the matter back to the file of the Ld. CIT(A) with a direction to him to provide a copy of comments/report of the Ld. AO to the assessee and decide the appeal afresh after allowing reasonable opportunity of hearing to both the parties. We order accordingly.
In the result, the appeal of the assessee is allowed for statistical purposes.