Umarfarooq Athani Vs Income Department (ITAT Bangalore)
Assessment Set Aside Due to Wrong Email Service: ITAT Condones Delay, Admits Additional Evidence and Restores Matter to AO
The Bangalore Bench of the ITAT condoned delays of 118 days in filing the appeal before the CIT(A) and 9 days before the Tribunal, holding that the lapses were inadvertent and supported by sufficient cause. The Tribunal also admitted additional evidence under Rule 29, finding it crucial for proper adjudication.
On merits, the assessee—an individual trader and commission agent—faced a best judgment assessment where cash deposits of ₹1.73 crore were treated as unexplained under section 69A and taxed at the higher rate under section 115BBE. The CIT(A) had dismissed the appeal in limine due to delay, without examining the merits.
The ITAT found a serious violation of natural justice, noting that although the assessee had updated his email address in Form 35, the Department continued to issue notices to the old email ID of the consultant, resulting in non-service of notices and denial of effective opportunity. The Tribunal relied on the Karnataka High Court ruling in Suresh Kumar Paruchuri v. CIT(A), NFAC, which held that once an updated email is on record, notices must be served at that address.
