Case Law Details
Stanton Capital (India) P Ltd. Vs ITO (ITAT Ahmedabad)
ITAT Ahmedabad held that post non-service of notice, revenue failed to carry out its primary responsibility to ascertain whether the company, against which notices were issued, and proceedings under section 148 was contemplated, was existing or not. Accordingly, matter remanded to carry out fresh adjudication.
Facts- The assessee is non-filer u/s. 139 of the Act for A.Y. 2011-12. Its case was reopened by issuance of notice u/s. 148 of the Act on 31.3.2017 and required the assessee to file return of income within 30 days, but the assessee did not file. Thereafter various notices u/s. 142(1) and 142(1) r.w.s. 129 were issued to the assessee. However, all the notices remained non-responded by the assessee. Ultimately, the AO was compelled to service notice by affixture on 4.8.2017 show causing the assessee as to why the assessment u/s. 144 should not finalized, but that affixture also remained non-complied. Therefore, the AO proceeded to frame assessment u/s. 144 of the Act on the basis of the material available on record.
During the impugned assessment, the AO based on the information received from Investigation wing of the Department that the assessee maintained account with HSBC Bank, and on verification it was revealed that there were unexplained credits of Rs.2,98,56,934/- from the third party account for A.Y. 2011-12. The AO obtained bank statement u/s. 133(6) of the Act. Since the assessee had not filed return for A.Y. 2011-12, the AO sought for explanation and details in respect of huge cash/cheque deposits found in the bank statements. However, the assessee failed to explain the transactions. In the absence of the explanation/reply from the assessee, the cash credit aggregating to Rs.2,98,56,934/- appearing in the bank accounts was treated as unexplained and added to the total income of the assessee, and exparte assessment order u/s. 144 read with section 147 was accordingly passed by the AO.
This exparte assessment order was challenged before the ld.CIT(A). However, the order was confirmed and appeal was dismissed. Being aggrieved, assessee preferred present appeal.
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