Case Law Details
Jai Prakash Sharma Vs ITO (ITAT Jaipur)
Income Tax Appellate Tribunal (ITAT) Jaipur has directed a fresh hearing in the case of Jai Prakash Sharma vs. Income Tax Officer (ITO) concerning the addition of ₹12,06,189 as undisclosed income for the Assessment Year 2011-12. The dispute arose after the revenue department obtained information that Sharma had sold gems and jewelry worth ₹12,06,189, despite no record of such business activity at his firm, M/s. Konark Impex. Based on this information, a notice under Section 148 of the Income Tax Act was issued on April 16, 2015, but Sharma did not respond. Consequently, the Assessing Officer (AO) assessed the case ex-parte under Sections 144, 143(3), and 147 of the Act, adding the entire amount as undisclosed income. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the addition due to Sharma’s failure to appear for hearings.
On appeal, ITAT Jaipur reviewed the case and found that Sharma had consistently failed to present his case before both the AO and CIT(A), leading to decisions being made without his representation. Considering the lack of discussion on facts and legal aspects, ITAT deemed it appropriate to remand the case for a fresh hearing. The tribunal directed the CIT(A) to provide Sharma with a fair opportunity to present his case while instructing him to participate in proceedings without seeking adjournments. The appeal was allowed for statistical purposes, and the order was pronounced in open court on December 20, 2024.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
This appeal by assessee is directed against the order of NFAC, Delhidated 20.05.2024 passed u/s. 250 of the Income Tax Act, 1961 (in short ‘the Act’) for A.Y. 2011-12. The assessee has raised the following grounds of appeal:-
1. Ld. CIT (A) NFAC has erred in law and on facts in justifying the reopening the case on borrowed satisfaction without proving service of notice under section 148 of IT Act on the assessee.
2. Without prejudice to ground no. (1) ld. CIT(A) was not justified in dismissing the appeal and confirming addition of Rs. 12,06,189/- for the sales made out of genuine purchases, by submitting Income tax Return under deeming provisions of section 44AD of Income Tax Act on total sales achieved.
3. The brief facts of the case are that the assessee individual filed his return of income declaring total income at Rs. 1, 61,190/- for the year under consideration. Thereafter, the revenue was in possession of an information received from the office of REICthat the assessee had sold gems and Jewellery for Rs. 12, 06,189/-vide bill no. 252, dated: 02.04.2010. It is also confirmed in the enquiry of the State Commercial Department that no gems and Jewellery business had been done by the assessee’s firm, i.e. M/s. Konark Impex in its business premises.
4. Based on above information, a notice u/s. 148 of the Act was issued to the assessee vide dated: 16.04.2015. In response to this neither return of income nor was any other reply ever filed by the assessee. Ultimately, the case of the assessee was assessed Ex-Parte u/s. 144 r.w.s. 143(3) & 147 of the Act by making an addition of Rs. 12, 06,189/- as undisclosed income. The assessee being aggrieved with this order preferred an appeal before the Ld. CIT (A), who in turn dismissed the appeal of the assessee, as the assessee never came forward to attend the hearings before the Ld. CIT (A). The assessee being further aggrieved with the order of the Ld. CIT (A) preferred the present appeal before us.
5. We have gone through the order of the AO, order of the Ld. CIT (A) and submissions of the assessee along with original ground of appeal and additional ground of appeal raised before us vide application filed on 19.11.2024. As observed (supra), the assessee never attended the hearings before the AO and thereafter before the Ld. CIT (A) also. Facts of the matter and law involved never discussed before the authorities below, in such a situation, we deem it fit to restore the matter back to the file of the Ld. CIT (A) for fresh hearing after giving the assessee a fresh opportunity of being heard and the assessee is directed to participate in the proceedings without seeking any adjournment. Grounds raised by the assessee are allowed for statistical purposes.
6. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 20th day of December 2024.
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