Shreenath Developers Vs ITO (ITAT Ahmedabad)
ITAT Ahmedabad held that ex-parte dismissal of appeal on account of non-appearance by CIT(A) without discussing the merits of the case is unsustainable in law. CIT(A) is obliged to dispose of appeal on merits.
Facts- The assessee is a builder / developer and for the impugned year under consideration, the assessee filed return of income showing “NIL” income. The case of the assessee was selected for complete scrutiny for the reason “introduction of large capital during the year of incorporation and large investment in property as compared to total income”.
AO was of the view that the assessee had shown excess capital of Rs. 4,50,000/- which was treated as unexplained cash credit under Section 68 of the Act. Further, AO observed that the assessee did not furnish any response or explanation alongwith proof of cash deposits and accordingly, AO added a sum of Rs. 1,16,000/- as unexplained money from undisclosed sources under Section 69A of the Act. AO also observed that on verification of purchase deed and bank statement, it was observed that the sum of Rs. 68,00,000/- shown as paid to the seller was not found in the bank statement. Accordingly, AO added a sum of Rs. 68,00,000/- as unexplained investment u/s. 69 of the Act.
