Case Law Details
Leela Devi Jain Vs ITO (ITAT Jaipur)
ITAT Jaipur held that ex-parte order passed without considering and dealing with the submission of the assessee is a non-speaking order. Accordingly, matter remanded.
Facts- The assessee had deposited cash at Rs. 28,70,000/- in his saving bank account. The assessee had filed her return of income on 30.03.2015 being belated showing total income of Rs. 1,77,350/-. Since no return of income was filed within time allowed u/s 139 and also the income disclosed by the assessee in her belated return, prima facie, does not justify the source of cash deposited, therefore, proceeding u/s 147 was initiated and notice u/s 148 was issued on 29.03.2018 after recording reasons and getting.
AO noted that the assessee failed to prove the genuineness of these transaction as well as credit worthiness of the credit in the bank account and since the assessee failed to discharge her burden to prove the genuineness of the transaction as well as identity and creditworthiness of the credit entry of Rs. 8,68,028/-, the same was treated as unexplained income of the assessee withing the meaning of section 68 of the Act.
CIT(A) passed ex-parte order. Being aggrieved, the present appeal is filed.
Conclusion- Held that the order of the ld. CIT(A) is ex-party and the same is passed without dealing with the merits of the case. The bench noted that the assessee is a house wife she has deposited the cash on various dates in the saving account maintained jointly with her husband. During the proceeding before the lower authority the assessee has not explained the source of cash deposited in to her bank account. We also note that the submission of the assessee has not been dealt with by the assessing officer so as to consider the savings of the assessee, withdrawal out of salary of her husband lying with her and the cash flow statement submitted by her why were not appropriate is not dealt with by passing a speaking order.
Considering this peculiar circumstances argued before us we are of the considered view that the assessing officer should hear the assessee submission on merits after affording proper opportunity of being hear and passed speaking order in the matter and therefore, the matter is set a side to the file of the learned assessing officer. At the same time the assessee is also directed to represent all the facts before the assessing officer and should not ask for the adjournment on frivols grounds and is directed to participate in this remand proceeding. At this stage we remand back the issue without commenting upon the merits of the case and the ld. AO is directed to complete the assessment in accordance with the law.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
This appeal is filed by assessee and is arising out of the order of the National Faceless Appeal Centre, Delhi dated 10/02/2023 [here in after (NFAC)/ ld. CIT(A) ] for assessment year 2011-12 which in turn arise from the order dated 28.12.2018 passed under section 143(3) r.w.s 147 of the Income Tax Act by Income-tax Officer, Ward, Tonk.
2. The assessee has marched this appeal on the following grounds:-
“1. That on the facts and circumstances of the case the ld. CIT(A) grossly erred in passing the ex-parte order and confirming the addition made by the ld. Assessing Officer.
2. That on the facts and circumstances of the case and in law the CIT(A) authorities grossly erred in confirming the addition of Rs. 8,68,028/- u/s 68 of the Act vide Assessment order u/s 143(3) r.w.s 147 of the Act.
3. The appellant craves leave to add, alter, modify or amend any ground on or before the date of hearing.”
3. The fact as culled out from the records is that the in this case, assessee had deposited cash at Rs. 28,70,000/- in his saving bank account with IDBI Bank, Tonk [a/c no. 683104000006231] during financial year 2010-11. The assessee had filed her return of income on 30.03.2015 being belated showing total income of Rs. 1,77,350/-. Since no return of income was filed within time allowed u/s 139 and also the income disclosed by the assessee in her belated return, prima facie, does not justify the source of cash deposited, therefore, proceeding u/s 147 was initiated and notice u/s 148 was issued on 29.03.2018 after recording reasons and getting.
3.1 During the assessment copy of bank statement was obtained from the bank u/s. 133(6) of the Act, this shows that the account is in joint name wherein the assessee has deposited a sum of Rs. 8,68,028/- on various dates. The assessee is basically a house wife. Her Husband is government servant in state government for last 21 years. The assessee never filed her return of income prior to the year under consideration. Therefore, the assessee was asked to explain the source of cash deposited. In reply, the assessee explained that cash was deposited out of savings of the husband and withdrawals from this account from time to time. A cash flow statement has been filed. A chart of gross and net salary of Shri Padam Chand Jain for last 21 years has been filed wherein total gross salary of Rs. 27,64,176/- was received by him during his service tenure. In addition, sources from GPF withdrawals, State Insurance & Housing loan have been explained. The ld. AO noted that the assessee failed to prove the genuineness of these transaction as well as credit worthiness of the credit in the bank account and since the assessee failed to discharge her burden to prove the genuineness of the transaction as well as identity and creditworthiness of the credit entry of Rs. 8,68,028/-, the same was treated as unexplained income of the assessee withing the meaning of section 68 of the Act.
4. Being aggrieved, the assessee carried the matter in appeal before the ld. CIT(A). A propose to the grounds so raised by the assessee the relevant findings of the ld. CIT(A) is reproduced here in below:
“7.2 As mentioned in paragraph 7 of this appeal order, this office has issued several letters to file written submission, however, neither any adjournment was sought for nor was any written submission filed. The letters were issued through ITBA system at the mail ID provided by the appellant. It is verified that all the mails sent through the ITBA are delivered to his email Id, however, no reply is submitted in support of the grounds of appeal filed.
From the above conduct of the appellant, it is evident that the appellant is no more interested in pursuing the appeal. Hon’ble Supreme Court in the case of CIT Vs B.N. Bhattacharjee and others [1979] 10 CTR 354 (SC) observed that preferring an appeal, means effectively pursuing it. Hon’ble M.P. High Court in the case of Estate of Late Tukojirao Holkar Vs CWT [1979] 223 ITR 480 (M.P.) dismissed the reference filed at the instance of the assessee for default and for not taking necessary steps. Considering the conduct of the assessee in the present circumstance, I am of the view that the assessee is not interested in pursuing the appeal. This view has been affirmed by Hon’ble ITAT Ahmedabad in case of Amitkumar H. Shah Vs. ACIT in ITA No. 2985/Ahd/201 0 vide their order dated 31 .12.2013, wherein following the order of ITAT Delhi Bench in the case of CIT Vs Multiplan India Pvt. Ltd., [1991] 38 ITD 320 (Del), ITAT has dismissed the appeal filed by the assessee for want of persuasion. Under these circumstances, the current appeal of the appellant is dismissed.”
5. The ld. AR appearing on behalf of the assessee prayed that the assessee is a house wife and she has not been given appropriate opportunity in the appeal filed before the ld. CIT(A) and even the ld. CIT(A) has not disposed off the appeal of the assessee on merits. The ld. AR of the assessee also submitted that the authorities below have not appreciated the facts in right perspective and have grossly erred in determining the income of the assessee. He also submitted that saving of house wife is also not considered by the lower authorities and therefore, he has relying upon the following orders:-
- Virendra Singh Verma vs. ITO in ITA No. 962/JP/2019 dated 04.2022.
- Sidharth Choudhary vs. ITO in ITA No. 890/DEL/2020 dated 19.01.2023.
- DCIT vs. Trans Freight Containers Ltd. in ITA No. 2337/Mum/201 6 dated 24.02.2017.
- Hindustan Steel Ltd. v. State of Orissa (SC) (1972) 83 ITR
6. The ld DR is heard who has relied on the findings of the lower authorities and more particularly submitted that the assessee was given sufficient opportunity of being heard by the ld. CIT(A) and the assessee has not submitted the arguments on merits. The ld. DR also submitted that if the matter is to be set a side then it may be sent back to the ld. AO so as to make the sufficient finding on facts by the ld. AO.
7. We have heard the rival contentions and perused the material placed on record. We have also persuaded the decision relied upon by both the parties. It is not disputed fact that the order of the ld. CIT(A) is ex-party and the same is passed without dealing with the merits of the case. The bench noted that the assessee is a house wife she has deposited the cash on various dates in the saving account maintained jointly with her husband. During the proceeding before the lower authority the assessee has not explained the source of cash deposited in to her bank account. We also note that the submission of the assessee has not been dealt with by the assessing officer so as to consider the savings of the assessee, withdrawal out of salary of her husband lying with her and the cash flow statement submitted by her why were not appropriate is not dealt with by passing a speaking order. Considering this peculiar circumstances argued before us we are of the considered view that the assessing officer should hear the assessee submission on merits after affording proper opportunity of being hear and passed speaking order in the matter and therefore, the matter is set a side to the file of the learned assessing officer. At the same time the assessee is also directed to represent all the facts before the assessing officer and should not ask for the adjournment on frivols grounds and is directed to participate in this remand proceeding. At this stage we remand back the issue without commenting upon the merits of the case and the ld. AO is directed to complete the assessment in accordance with the law.
In the result, appeal of the assessee is allowed for statistical purpose.
Order pronounced in the open Court on 14/06/2023
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