Case Law Details
Tapas Kumar Chanda Vs ITO (ITAT Cuttack)
The Income Tax Appellate Tribunal (ITAT) in Cuttack has remanded a tax appeal concerning a cash deposit of ₹9 lakh, granting the assessee, Tapas Kumar Chanda, one more opportunity to furnish documentary evidence. The decision came in the case of Tapas Kumar Chanda vs. ITO, where the assessee’s appeal was initially delayed by 302 days. The tribunal, after reviewing a condonation petition supported by medical certificates, accepted the delay as non-intentional, attributing it to the assessee’s illness.
The dispute arose during the assessment for the year 2017-18, when the Assessing Officer (AO) noted that the assessee had deposited ₹11.98 lakh in cash during the demonetization period. While the assessee claimed that a portion of this amount was from prior withdrawals and the rest from past savings related to his gold and silver ornaments business, he failed to provide documentary evidence to support the cash-in-hand claim of ₹4.18 lakh. Consequently, the AO completed the assessment ex-parte under Section 144, determining a total income of ₹9,53,550.
The assessee then appealed to the Commissioner of Income Tax (Appeals), or CIT(A). However, despite receiving multiple hearing notices, the assessee did not appear. Citing a lack of prosecution, the CIT(A) dismissed the appeal, confirming the AO’s addition.
On further appeal to the ITAT, the assessee’s representative pleaded for another chance, assuring the tribunal that the assessee would cooperate in the set-aside proceedings. The ITAT, acknowledging that both the AO and the CIT(A) had passed orders due to non-compliance, decided to restore the matter to the file of the CIT(A). The tribunal’s decision was made in the interest of adhering to the principles of natural justice. It directed the CIT(A) to provide a final opportunity for the assessee to be heard and present his case with evidence. The ITAT also issued a caution, stating that if the assessee fails to cooperate this time, the CIT(A) is at liberty to pass an appropriate order based on the available records. The appeal was thus allowed for statistical purposes, setting aside the previous order but not determining the final outcome.
FULL TEXT OF THE ORDER OF ITAT CUTTACK
The present appeal is directed at the instance of assessee against the order of ld. Addl/JCIT(A)-2, Guwahati dated 22/04/2024 in Appeal No. CIT(A), Cuttack/11065/2019-20, passed for Assessment Year 2017-18.
2. The appeal is time barred by 302 days. The assessee has filed condonation petition supported by an affidavit stating that due to his illness, he could not able to bring the notice of the Advocate for filing the appeal. In support of the illness, medical certificates are enclosed with the petition. After recovering from the illness, he immediately contacted the petition. After recovering from the illness, he immediately contacted the Advocate and filed the appeal. Therefore, there was delay of 302 days in filing the appeal. It is prayed that the delay was not intentional and same may be condoned. Ld Sr DR opposed the condonation petition.
3. After hearing the parties and perusing the condonation petition, I am satisfied that the assessee had a reasonable cause in not filing the appeal within the time and hence, I condone the delay of 302 days and admit the appeal for hearing.
4. Brief facts of the case are that the assessee is an individual and filed the return of income on 14.8.2019. During the course of assessment proceedings, the Assessing officer noticed that during the period of demonetisation from 9.11.2016 to 30.12.2016, the assessee has deposited cash amounting to Rs.11,98,000/- in the bank account maintained with Canara Bank. Further, the assessee has disclosed net profit of Rs.3,21,000/- against gross receipt of Rs.67,11,630/-. The AO observed that the assessee has to compute the net profit @ 8% of total gross receipt. Notice u/s.142(1) was issued to the assessee to furnish documentary evidences in support of the claim. In regard to deposit of cash in bank, the assessee submitted that he deals in purchase and sale of gold and silver ornaments. The source of cash deposit is solely from his business transaction. It was submitted that out of cash deposit of Rs.11,98,000/-, an amount of Rs.7,80,000/- was withdrawn from his account on 8.11.2016 and remaining amount of Rs.4,18,000/- was out of his past savings. However, no documentary evidences were furnished regarding cash in hand of Rs.4,18,000/-. The Assessing Officer completed the assessment u/s.144 of the Act determining the total income at Rs.9,53,550/-.
5. Being aggrieved, the assessee carried the matter in appeal before the ld CIT(A). However, despite various opportunities given to the
assessee, there was no representation from the side of the assessee and accordingly, ld CIT(A) dismissed the appeal of the assessee. Hence, the assessee is in further appeal before the Tribunal.
6. At the time of hearing, ld AR submitted that the ld CIT(A) has dismissed the appeal of the assessee for want of prosecution without
considering the case on merits. He prayed that one more opportunity be granted and the assessee will cooperate in the set aside proceedings.
7. On the other hand, ld Sr DR vehemently supported the order of the ld CIT(A). He stated that various opportunities have been granted to the assessee but the assessee failed to comply with the same.
8. I have heard the rival contentions and perused the material available on record. A perusal of assessment order clearly shows that the Assessing Officer has passed order u/s.144 of the Act on account of non-production of documentary evidences. A perusal of the impugned order clearly shows that as there was no response to the notices to substantiate the claim with documentary evidences and submissions, ld CIT(A) confirmed the addition made by the AO. Before us, ld AR undertakes that the assessee will cooperate the proceedings, if the matter is restored back to the file of the ld AO. Considering the facts and circumstances of the case, I am inclined to set aside the order passed by the ld. CIT(Appeals) in order to meet the principle of natural justice, and remit the matter back to his file with a direction to provide one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly cooperate with the proceedings before the CIT(A), failing which the Ld CIT(A) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes.
9. In the result, appeal of the assessee stands allowed for statistical purposes.
Order dictated and pronounced in the open court on 30/06/2025.
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