Case Law Details
Faridabanu Shaikh Vs ITO (ITAT Ahmedabad)
In matter abovementioned ITAT remanded the matter to the CIT (A) who passed ex-parte order without mentioning to any proper service of notice of hearing.
The assessee earned income from selling milk and filed her return for AY 2017-18 declaring income of Rs.1,78,110/-. The case was selected for limited scrutiny with the reason of “large value cash deposits during demonetization period as compared to returned income”. The AO observed that, there was a closing cash book balance of Rs.12,84,371/- which is claimed to have been accumulated over the period of last five years and there was not a single withdrawal towards any of the expenses from the cash books furnished for the last five years. AO doubted the genuineness and made an addition of Rs.11 lakhs u/s.69A as unexplained money of the assessee, which was deposited during the period of demonetization. Appeal before CIT (A) was dismissed ex-parte.
Before ITAT assessee submitted that CIT (A) passed order without providing sufficient opportunity of being heard on the other hand revenue supported order passed by lower authorities.
ITAT held that the order passed by the CIT(A) is ex-parte and without mentioning any proper service of notice as contained in Paragraph No.4 of the order of the CIT(A). Therefore, it would be appropriate if this matter is remanded back to the file of the CIT(A) for proper verification and adjudication.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal is filed by the Assessee against the order dated 13/12/2023 passed by the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)” in short] for Assessment Year (AY) 2017-18.
2. Grounds of appeal are as under:
“1. The Ld.CIT(A) erred in law as well as on fact in dismissing appeal ex-parte.
2. Ld.CIT(A) erred in law as well as on fact in upholding addition of Rs.11,00,000 made by Ld.AO being cash deposited in bank account.”
3. The assessee filed her return of income for AY 2017-18 on 23/09/2013 declaring income of Rs.1,78,110/-. The assessee, as per the observation of the Assessing Officer (AO), is claimed to have income from milk selling business. The return of income was processed u/s.143(1) of the Income Tax Act, 1961 (hereinafter referred to as “the Act). The case was selected for limited scrutiny with the reason of “large value cash deposits during demonetization period as compared to returned income”. Accordingly, notice u/s.143(2) of the Act was issued on 23/08/2018. Notice u/s.142(1) of the Act was issued along with questionnaire on 11/04/2019. Further, notice u/s.142(1) of the Act was also issued to the assessee on 10/10/2019 respectively. In response to the notices, the assessee furnished written submissions and details. The AO observed that as on 31/03/2016, there was a closing cash book balance of Rs.12,84,371/- which is claimed to have been accumulated over the period of last five years as seen from the cash books submitted for Financial Years (FY) 2010-11 to 2015-16. The AO observed that the cash books and other accounts furnished by the assessee have no genuineness and there was not a single withdrawal towards any of the expenses from the cash books furnished for the last five years. The assessee could not establish the genuineness and, thus, this is an undisclosed amount of Rs.11 lakhs which was deposited during the period of demonetization. Thus, the AO made an addition of Rs.11 lakhs u/s.69A of the Act as unexplained money of the assessee.
4. Being aggrieved by the assessment order, the assessee filed an appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.
5. The Ld.AR for the assessee submitted that the CIT(A) has passed ex-parte order without giving any notice to the assessee.
6. The Ld.DR for the Revenue relied upon the assessment order and the order of the CIT(A).
7. We have heard both the parties and perused the material available on record. After going through the file, it appears that there is a delay of 82 days in filing the present appeal for which no explanation has been given by the assessee, but from the perusal of the assessment order and the order of the CIT(A), it reveals that the order of the CIT(A) is ex-parte. Further, in Column 3 (c), the date of service or communication of the order mentioned in Form No.36 is 13/12/2023 and, therefore, we condone the delay. Besides this, the order passed by the CIT(A) is ex-parte and without mentioning any proper service of notice as contained in Paragraph No.4 of the order of the CIT(A). Therefore, it would be appropriate if this matter is remanded back to the file of the CIT(A) for proper verification and adjudication of the issues contested by the assessee before te4h CIT(A). The CIT(A) will adjudicate the same as per the Income Tax Statue. Needless to say, the assessee be given proper opportunity of being heard by following natural justice.
8. In the result, the appeal of the assessee is partly allowed for statistical purposes.
Order pronounced in the Court on 22nd November, 2024 at Ahmedabad.
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