Case Law Details
Krishnan Gopikrishnan Vs ITO (ITAT Chennai)
In Krishnan Gopikrishnan vs Income Tax Officer (ITAT Chennai), the assessee appealed against the ex parte order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] on February 10, 2024, for the Assessment Year 2017-18. The appeal stemmed from an earlier order by the Assessing Officer (AO), who had made additions of Rs. 24,74,680 to the income, including Rs. 14,56,000 under Section 69A of the Income Tax Act, related to unexplained demonetization cash deposits. The assessee argued that the AO had issued notices to an inactive email ID, preventing them from receiving any communication regarding the assessment, thus hindering their ability to respond or provide the required documents to explain the cash deposits.
The Income Tax Appellate Tribunal (ITAT) recognized the violation of natural justice, acknowledging that the notices were sent to an inactive email ID and the assessee had not been provided an adequate opportunity to present their case. Citing the Supreme Court decision in TIN Box Co. v. CIT, the Tribunal decided to set aside the impugned order of the CIT(A) and directed the AO to conduct a fresh de novo assessment. The AO was instructed to hear the assessee, consider relevant documents and submissions, and pass an order in accordance with the law. The appeal was allowed for statistical purposes, ensuring the assessee would have the opportunity to present their case fully.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter in short “the Ld.CIT(A)”), Delhi, dated 10.02.2024 for the Assessment Year (hereinafter in short “AY”) 2017-18.
2. At the outset, the Ld.AR of the assessee brought to our notice that the Ld.CIT(A) has passed the impugned order ex parte qua the assessee without going into the merits of the case. He also pointed out that the AO has also passed an ex parte order qua assessee since the assessee didn’t respond two of his notices on 12.03.2018 & 06.09.2018 because it was sent to inactive e-mail ID. According to the Ld.AR, because statuary notices were forwarded to inactive e-mail ID, the assessee didn’t receive any notice of hearing from the Office of the AO, which prevented the assessee from responding/filing the relevant documents to substantiate the nature & source of the cash deposits during the demonetization period and as well as other documents called for by the AO. The Ld.AR relying on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC) prays that since its case falls squarely as per the said decisions, the assessee may be given an opportunity before the AO.
3. Per contra, the Ld.DR doesn’t want us to give one more innings to the assessee.
4. Be that as it may, it is noted that the AO has only issued two notices (supra) before making addition of Rs.24,74,680/- which included addition made u/s.69A of the Income Tax Act, 1961 of Rs.14,56,000/- as well as addition of Rs.10,56,000/- and since, the assessee pleads violation of natural justice, we are inclined to give one more opportunity to the assessee and therefore, relying on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. (supra), we set aside the impugned order of the Ld.CIT(A) and restore the assessment back to the file of the AO with a direction to frame the assessment de novo after hearing the assessee. The Ld.AR is directed to file relevant documents/written submissions and the AO to pass order in accordance to law.
5. In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on the 04th day of December, 2024, in Chennai.
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