Introduction: In the case of Chiranji Lal Bairwa Vs. ITO (ITAT Jaipur), the Income Tax Appellate Tribunal (ITAT) Jaipur dismissed the appeal filed by the assessee. This decision stemmed from a non-compliance issue regarding a notice issued by the Income Tax Department (ITD) for determining the value of land under section 50C of the Income Tax Act.
1. Background of the Case The appeal was filed by the assessee in response to the order of the National Faceless Appeal Centre, Delhi, dated 09.03.2023, for the assessment year 2010-11. This order was based on the proceedings initiated under section 147 read with section 144 of the Income Tax Act, 1961. These proceedings were conducted by the Tax Recovery Officer-3, Jaipur.
2. Grounds of the Appeal The assessee raised several grounds in the appeal, challenging the validity of the notice issued under section 148, the assessment order, and the addition of Rs. 8,31,375. The addition was related to the treatment of the sale of property as a capital asset.
3. Non-Compliance Issue The case revolved around non-compliance by the assessee with various notices issued by the ITD. The ITD had issued multiple notices under section 142(1), including a final opportunity/show cause notice. Despite these notices, the assessee did not provide the necessary compliance or submissions.
4. Ex-Parte Decision and Ld. CIT(A) Order The assessment under section 147/144 was completed ex-parte on 21.12.2017, resulting in an addition of Rs. 8,31,375 to the total income. The appeal against this assessment was filed with the Ld. CIT(Appeals)-3, Jaipur. However, the appeal was decided ex-parte on 19.12.2018 due to the complete non-compliance of the assessee.
5. Set Aside to Ld. CIT(Appeals) and Continued Non-Compliance The case was brought to the ITAT, Jaipur Bench, which set aside the issue for fresh adjudication by the Ld. CIT(Appeals) in 2020. Despite the opportunity provided by the ITAT and multiple notices, the assessee continued to be non-compliant in the proceedings before the Ld. CIT(A).
6. ITAT’s Decision Considering the history of non-compliance by the assessee, the ITAT observed that the appellant had been given ample chances to present their case. The bench noted that the assessee did not appear or file requisite submissions before the Ld. CIT(A) and also failed to provide any documents when filing the appeal. As a result, the ITAT dismissed the appeal of the assessee.
Conclusion: The ITAT Jaipur’s decision to dismiss Chiranji Lal Bairwa’s appeal highlights the importance of compliance with ITD notices and the consequences of non-compliance in the context of tax proceedings. The dismissal of the appeal underscores the need for taxpayers to actively participate in the tax assessment and appeal processes.
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 09.03.2023 [here in after ld. NFAC/CIT(A) ] for assessment year 2010-11 which in turn arise from the order dated 21.12.2017passed under section 147 r.w.s. 144 of the Income Tax Act, 1961 [ here in after to as Act ] by TRO-3, Jaipur .
2. In this appeal, the assessee has raised following grounds: –
“1. That on the facts and in the circumstances of the case the order passed by ld. CIT(A), NFAC is bad in law and bad in facts.
2. That on the facts and in the circumstances of the case the Ld. CIT(A), NFAC grossly erred in upholding the validity of notice u/s 148 of the Act.
3. That on the facts and in the circumstances of the case the ld. CIT(A), NFAC erred in upholding validity of assessment order passed by the ld. AO.
4. That on the facts and in the circumstances of the case the Ld. CIT(A), NFAC grossly erred in sustaining the addition of Rs. 8,31,375/- by treating the sale of property as capital asset which is contrary to material facts.
6. That on the facts and in the circumstances of the case the Ld. CIT(A), NFAC grossly erred in making allegations against the assessee which are not only contrary but also against the principle of natural justice.
7. That the petitioner may kindly be permitted to raise any additional or alternative grounds at or before the time of hearing.
8. The petitioner prays for justice & relief.”
3. A propose to the hearing, the bench noted that there is delay in filing appeal by 56 days notices of defect send to the assessee by e-mail but has not yet responded and hearing. This case was fixed for hearing on 29.03.2023 on the date of hearing, the assessee has filed an adjournment application and the same was dismissed as the reasons advanced in the adjournment application is not sufficient, the content of the adjournment application is as under:-
“The above-referred appeals are posted for hearing before the Hon’ble Bench on 20/09/2023.I shall be grateful if your honor’s make it convenient to adjourn the hearing any other suitable date as the I have received the instruction from the local council for arguing the appeal today but not received the Vakalatnama and appeal record as the local council is busy in audit work and filing of return.”
4. Since we have not entertained the adjournment application, the appeal of the assessee is decided based on the facts available on record.
5. Succinctly, the fact as culled out from the records is that notice u/s 148 was issued on 30.03.2017 after obtaining prior approval of Pr.CIT-3, Jaipur since there was an information with the Department that assessee had sold land vide Khasra No. 1091/954 during FY 2009-10 for Rs.5,00,000/- within the municipal limits of Jaipur city. The value of this land under section 50C of the IT Act, 1961 is Rs.8,36,375/-. Notice u/s 142(1) was issued on 11.08.2017 and served for compliance on 24.08.2017. There was no compliance by assessee to this notice u/s 142(1) and subsequent notices u/s 142(1) and final opportunity/show cause notice u/s 142(1) dated 11.09.2017 for compliance on 25.09.2017. Assessment u/s 147/144 was completed ex-parte on 21.12.2017 at total income of Rs.8,31,375/-. Against this order, appeal was filed before Ld. CIT(Appeals)-3, Jaipur on 27.01.2018 who decided the appeal ex-parte on 19.12.2018 due to total non-compliance by assessee. Against this order assessee moved ITAT, Jaipur Bench, wherein the bench vide order in ITA No.206/JP/2019 dated 06.03.2020 set aside the issue to the file of ld. CIT(Appeals) for fresh adjudication.
6. Thus, the bench noted that the assessee was given the chance to represent the case before ld. CIT(A) and even though there were three notices given after set aside of the proceedings by the Bench to the assessee. Three instances of the notices are given in span of 10 months and the assessee did file any submission in support of the grounds raised in the appeal before the ld. CIT(A). Therefore, the ld. CIT(A) has passed a detailed order, mentioning the details of 3 notices issued to the assessee as reproduced here in below :
|Notice issued||Date of issue of notice||Date of compliance||Remarks|
|250||21.12.2022||26.12.2022||Adjournment petition filed on 17.01.2023|
7. Therefore, in support of the fact that the assessee remained non- compliant in the earlier round of litigation. One more chance was given by the Bench vide order dated 06.03.2020 on which the assessee in support of given three occasions did not appear and file the requisite submission before ld. CIT(A). Therefore, it appears that the assessee is not interested in pursuing his case on merits. Before us also while filing the appeal, the assessee did not file any document in support of the claim that why the addition of Rs. 8,31,375/- is not sustainable and it is sale of property and is capital assets and receipt thereof is not chargeable to tax in full. Based on these observations, the appeal of the assessee stands dismissed.
In the result, the appeal of the assessee is dismissed.
Order pronounced in the open court on 04/10/2023.