Tapas Kumar Das Vs ITO (ITAT Kolkata)
In a recent order, the Income Tax Appellate Tribunal (ITAT), Kolkata bench, has set aside an income tax assessment for Assessment Year 2017-18, ruling that the initial notice for scrutiny issued to the assessee was invalid. The tribunal’s decision hinged on the tax department’s failure to comply with a binding instruction issued by the Central Board of Direct Taxes (CBDT) regarding the format of such notices.
The case involved Tapas Kumar Das, the assessee, whose income tax return for AY 2017-18 was selected for scrutiny under the Computer Assisted Scrutiny Selection (CASS) system. Following this selection, the Assessing Officer (AO) issued notices under Section 143(2) and Section 142(1) of the Income Tax Act, 1961, along with a questionnaire.
According to the tribunal’s order, the assessee did not comply with the notices during the assessment proceedings. This led the AO to complete the assessment ex-parte under Section 144 of the Act on December 27, 2019. In this ex-parte assessment, the AO made a significant addition of ₹25,74,500 to the assessee’s income, categorizing it as unexplained money under Section 69A of the Act, reportedly linked to deposits made during the demonetization period.
The assessee appealed the AO’s order to the National Faceless Appeal Centre (NFAC), the Ld. CIT(A). However, the CIT(A) upheld the AO’s assessment, noting the lack of compliance from the assessee during the appellate proceedings as well.
