AO adds Rs. 3.56 crore as Non disclosed transactions: ITAT restores matter for reconsideration to CIT(A) with penalty
The tribunal observed that failure to respond to statutory notices warranted a penalty while restoring the matter for reconsideration
The Hyderabad Bench of the Income Tax Appellate Tribunal ( ITAT ) has restored the appeal to the Commissioner of Income Tax (Appeals) [CIT(A)] in an undisclosed transactions case with a penalty of Rs. 2,000 for non-compliance with statutory notices. Shri Sankarlal Naik Karamsi (assessee), an individual, had not filed his income tax return for the assessment year 2016-17. The case was...
The Hyderabad Bench of the Income Tax Appellate Tribunal ( ITAT ) has restored the appeal to the Commissioner of Income Tax (Appeals) [CIT(A)] in an undisclosed transactions case with a penalty of Rs. 2,000 for non-compliance with statutory notices.
Shri Sankarlal Naik Karamsi (assessee), an individual, had not filed his income tax return for the assessment year 2016-17. The case was flagged under the Non-filer Monitoring System ( NMS ) for high-value financial transactions.
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The AO observed that the assessee had total bank credits of Rs. 3,56,91,473 and cash deposits of Rs. 9,90,000, which were not disclosed. Therefore, proceedings under Section 147 were initiated, and a notice under Section 148 was issued to the assessee.
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The assessee failed to respond to multiple notices issued by the revenue. Therefore, the AO completed the assessment and treated the entire amount as undisclosed income under Section 69A. The AO also initiated penalty proceedings.
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Aggrieved by the order of the AO, the assessee filed an appeal to the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) dismissed the appeal due to the assessee's non-compliance.
Aggrieved by the order, the assessee filed an appeal before ITAT. The counsel for the assessee requested another opportunity to present evidence.
On the other hand, the counsel for the revenue submitted that the assessee neither appeared before AO nor before the CIT(A). The counsel also argued that the assessee clearly violated and non-complied with the notices.
The two-member ITAT bench, comprising Laliet Kumar (Judicial Member) and Manjunatha G. (Accountant Member) observed that the assessee failed to comply with statutory notices both before the AO and CIT(A).
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The tribunal also observed that in the interest of natural justice, the matter may be restored to CIT(A) for fresh adjudication.
The tribunal directed the assessee to submit necessary evidence before CIT(A) and imposed a penalty of Rs. 2,000, payable to the Telangana State Legal Aid Authorities. The tribunal directed the assessee to furnish proof of payment within a month of the order.
Therefore, the tribunal restored the matter to the CIT(A). Thereby the appeal of the assessee was allowed for statistical purposes.
To Read the full text of the Order CLICK HERE
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