Sudhanshu Rastogi Vs ACIT (ITAT Lucknow)
Income Tax Appellate Tribunal (ITAT), Lucknow, has allowed an appeal filed by Sudhanshu Rastogi against an order passed by the Learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, concerning the assessment year 2017-18. The appeal challenged the addition of ₹43,00,000 to Rastogi’s income under Section 68 of the Income Tax Act, 1961, by the Assessing Officer (AO). This addition represented cash deposited during the demonetization period, which the AO deemed unexplained despite the assessee’s claim that it originated from sales and receipts duly recorded in audited books of accounts.
The assessee had initially filed an appeal with the Ld. CIT(A), NFAC, but the order was passed ex parte, sustaining the AO’s addition. Before the ITAT, the assessee’s counsel argued that there was no effective representation before the lower authorities and that both orders were passed ex parte without providing sufficient opportunity for a hearing. The counsel requested that the matter be remanded back to the Ld. CIT(A) with directions to grant an adequate opportunity. The Departmental Representative (DR) supported the orders of the lower authorities, contending that sufficient opportunities were provided.
The ITAT, after considering the arguments and reviewing the records, noted that while the Ld. CIT(A) mentioned granting opportunities, the order lacked a clear finding on the merits of the cash deposit’s explanation. The Ld. CIT(A) had dismissed the appeal, stating the assessee’s non-compliance suggested an unwillingness to furnish details that would be detrimental. However, the ITAT, prioritizing the principle of natural justice and fairness to both parties, found it necessary to set aside the impugned orders.
Consequently, the ITAT restored the grounds of appeal to the file of the Ld. CIT(A) to decide the appeal on its merits after providing both the assessee and the revenue with a reasonable opportunity to present their case. The assessee’s appeal was thus allowed for statistical purposes, meaning the case is sent back for reconsideration by the appellate authority.
FULL TEXT OF THE ORDER OF ITAT LUCKNOW
