The Ahmedabad Bench of Income Tax Appellate Tribunal(ITAT)ordered a fresh hearing by the Commissioner of Income Tax(Appeals)[CIT(A)] in the Rs. 1.65 crore cash deposit case on grounds of non-compliance.
Ajay Jethanand Notwani,appellant-assessee,opted for taxation under Section 44AD of the Act. The Assessing Officer (AO) took action after noticing a cash deposit of Rs. 1,65,47,220/- in the assessee’s Bank of Baroda account, which was not reported in the income tax return. Despite multiple notices, the assessee did not comply. As a result, the AO added the Rs. 1.65 crore deposit to the assessee’s income under Section 68 of the Act.
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The assessee appealed to the CIT(A), who dismissed the case due to non-appearance. The CIT(A) observed that the assessee had not responded to multiple notices and was regularly non-compliant. As the assessment was completed under Section 144 due to this, the CIT(A) found no reason to alter the AO’s decision and dismissed the appeal.
Dissatisfied by the decision of the CIT(A) the assessee appealed before the tribunal.
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The assessee’s counsel argued that the CIT(A) upheld the Rs. 1.65 crore addition without considering the facts or merits of the case. The counsel noted that after issuing two notices, the CIT(A) dismissed the appeal shortly after the assessee requested an adjournment. The counsel claimed the order lacked reasoning and violated natural justice. The counsel requested that the matter be sent back to the CIT(A) for de-novo consideration.
The two member bench comprising Siddhartha Nautiyal(Judicial Member) and Makarand V.Mahadeokar(Accountant Member) examined the case and listened to both parties. In the interest of justice, the matter was referred back to the CIT(A) for a fresh review, with instructions to allow the assessee an opportunity to be heard. It was also noted that if the assessee remained non-compliant, the CIT(A) could take appropriate action based on the available records.
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In short the appeal filed by the assessee was allowed for statistical purposes.
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