The Income Tax Appellate Tribunal ( ITAT ) Delhi recently dealt with an Income Tax case involving unexplained credits of Rs. 11.06 crore, where the appellant challenged an addition made by the Assessing Officer ( AO ) under Section 68 of the Income Tax Act.
In the instant case an order under Section 144 of the Income Tax Act, 1961 was passed by the Assessing Officer by making various additions to the tune of Rs.13,90,59,524/-. The Assessing Officer noted lack of cooperation on the part of the assessee during the assessment proceedings.
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Upon assessee’s appeal, Ld. CIT(A)/NFAC, noted that notices of hearing were not complied with, hence, he dismissed the appeal of the assessee on account of non-prosecution vide its order dated 22.11.2023. Against the order of the CIT(A)/NFAC, Delhi, assessee preferred an appeal before the Tribunal.
The appellant argued that the inability to properly present the case before the AO was due to disruptions caused by the Covid-19 pandemic. The appeal was initially dismissed by the Commissioner of Income Tax (Appeals) [CIT(A)]/National Faceless Appeal Centre ( NFAC ) for non-prosecution, without addressing the merits of the case.
It was observed that, “CIT(A) has not decided the appeal on merits, but dismissed the same on account of non-prosecution”.
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Upon hearing both parties, the ITAT noted that the CIT(A) should not have dismissed the appeal solely on the grounds of non-prosecution. Considering the situation of the appellant during the Covid-19 period and the interest of justice, the tribunal bench of Judicial Member Sudhir Pareek and Accountant Member Shamim Yahya remanded the matter back to the AO.
The AO has been directed to reassess the case on its merits, ensuring that the appellant is given a fair opportunity to present his case.
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