Case Law Details
Chandra Bali Singh Vs ITO (ITAT Allahabad)
In the case of Chandra Bali Singh Vs ITO, the ITAT Allahabad disposed of two interconnected appeals for the assessment year 2009-10. The first appeal challenged the quantum addition of Rs. 1,108,130 made by the Assessing Officer (AO), which was based on cash deposits in the bank. The AO had passed an ex parte order due to the appellant’s failure to respond to notices under sections 148 and 142(1) of the Income Tax Act. The appellant claimed inadequate time to respond and argued that their submissions before the CIT(A) were not considered. The ITAT found that the appellant had not complied adequately with the authorities below and remanded the matter to the AO for a fresh assessment, providing the appellant a chance to present the case properly.
The second appeal dealt with the penalty imposed under Section 271(1)(c) for the quantum addition of Rs. 1,108,130. Since the matter was remanded for reconsideration of the quantum addition, the ITAT ruled that the penalty could not stand and quashed it. The ITAT allowed the appeal on technical grounds, giving the AO the opportunity to initiate new penalty proceedings if the quantum addition was upheld after reassessment. The ITAT’s decision was pronounced on December 4, 2024, in Allahabad, Uttar Pradesh.
FULL TEXT OF THE ORDER OF ITAT ALLAHABAD
These are batch of two appeals pertaining to the same assessee for the same assessment year. Appeal in ITA No. 115/Alld/2020 is appeal in the quantum matter whereas ITA No.116/Alld/2020 is appeal against levy of penalty under section 271(1)(c). Since, both these appeals are inter connected, they are being disposed of through a common order.
2. For the sake of convenience, ITA No. 115/Alld/2020 is being disposed of first. In this case, the appeal emanates from order under section 250 of the Income Tax Act, 1961 (hereinafter the ‘Act’) passed by the ld. CIT(A), NFAC, vide order dated 21.12.2023. This appeal itself had been filed against the action of the ld. AO who had passed an order dated 28.06.2016, in an ex parte manner, on the ground that the assessee did not respond to either the terms of notice under section 148 of the Act, nor notice under section 142(1) issued on 30.05.2016. Through a rather cryptic order, the ld. AO had added an amount of Rs.1108130/- on account of cash deposit in the bank account. This addition was carried before the ld. First Appellate Authority, who has also recorded in para 4 (page 3 of the impugned order) that five opportunities given to the appellant for presenting his case were not availed off. Thereafter, the ld. CIT(A) proceeded to decide the case on the basis of records available before him.
3. Aggrieved with this action of the ld. CIT(A), the appellant has approached the ITAT through as many as seven grounds of appeal, which mainly challenged the very little time given to him for responding to the AO’s notice as also there is a grievance that the ld. CIT(A) did not consider the submissions filed before him. Also the quantum addition of Rs.1108130/- has been challenged.
3.1 Before us, the ld. AR has pointed out the extremely short and allegedly non speaking order passed by the ld. AO and has also averred that the ten page written submissions filed before the ld. CIT(A) was not taken into consideration before he passed the impugned order. The ld. AR prayed for another opportunity to present the full facts before the authorities below.
3.2 The ld. DR, on the other hand, stated that the assessee has not filed any response to either the notice under section 148 of the Act or even the notice under section 142(1) issued by the ld. AO. Furthermore, there is nothing on record to show that there was any submission filed before the ld. CIT(A) on the basis of which he could have formed some kind of opinion about the merit of the impugned addition.
4. We have carefully considered the rival submission and also gone through the records. It is evident that the assessee has not really complied in any fruitful manner before any of the authorities below. Even though, the ld. AR has mentioned about the filing of submissions before the First Appellate Authority but it does not appear as if those submissions, if at all filed, were taken into consideration by the ld. CIT(A). Accordingly, in the interest of substantive justice, we remand this matter back to the file of ld. AO for a fresh assessment, after giving an opportunity of being heard to the appellant.
5. In the result, the appeal is allowed for statistical purposes.
ITA No.116/Alld/2020 (A.Y. 2009-10)
6. This matter emanates from the quantum addition of Rs.1108130/- on which penalty under section 271(1)(c) has been imposed. As is evident from the finding given for ITA No.115/Alld/2020, since the matter has been remanded back to the file of the ld. AO, this penalty cannot survive as of now. For this technical reason, this penalty is deleted. However, the ld. AO would be at liberty to initiate fresh proceedings under section 271(1)(c) in case there is any addition in the quantum matter, which has been remanded back.
7. In the result, the appeal is allowed.
Order pronounced in the open court on 04.12.2024 at Allahabad, U.P.
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