The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has recently, in an appeal filed before it, on finding that no notice was send to the Assessee, and that ex- parte decision was arrived at, in case of addition and conformation of cash deposits, restored the matter to the AO.
The aforesaid observation was made by the Delhi ITAT, when an appeal was filed by the Assessee against the order of the Commissioner of Income Tax (Appeals), NFAC, Delhi (CIT(A), dated 19.10.2022, arising from the assessment order dated 02.12.2019, passed by the Assessing Officer (AO) under Section 144 read with. Section 147 of the Income Tax Act, 1961, concerning AY 2012-13.
The ground of the assessee’s appeal being that on the facts and circumstances of the case, the CIT (A), NFAC, Delhi has erred in dismissing the appeal of the appellant without proper opportunity of being heard, he added that on the facts and circumstances of the case, both the lower authorities have erred in making / confirming addition of Rs. 19,49,550/- in the income of appellant, on account of cash deposited into bank of Rs. 19,49,550/- from the sales proceeds of business.
When the matter was called for hearing, it was submitted by Adv. Shri Jai Bhagwan Sharma, the counsel for the assessee that in the present case, the matter could not be attended both before the Assessing Officer as well as the CIT(A), for the reason that the assessee did not receive the notice from the Department in person.
He added that the notice was probably served on the counsel of the assessee who did not inform the assessee, which prevented the assessee from necessary compliances. He further pointed out that an affidavit dated 7th March, 2023 was filed to this effect in support of the assertions made.
On the other hand, Shri Om Parkash, the Sr.DR, strongly supported the authorities below.
Hearing the opposing contentions of both sides, as well as perusing the materials available on record, the ITAT observed:
“On perusal of the assessment order, it appears that the assessee has deposited cash amount to Rs.19,49,553/- in the savings bank account in Financial Year 2011-12 relevant to Assessment Year 2012-13 in question. The Assessing Officer attempted to make inquiry on the source of such cash depositsbut however the matter was proceeded ex-parte in the absence of compliances.”
“In the light of the assertions made towards non-compliance before Assessing Officer and CIT(A), we consider it expedient to restore the matter back to the file of the Assessing Officer to take the case to the logical conclusion. It will conduce to effective administration of justice where one more opportunity is given to Assessee to demonstrate bona fide of its case. The assessee is however cautioned to diligently attend the assessment proceedings and fully co-operate with the Revenue Authorities in the matter without any demur”, the coram of Khul Bharat, the Judicial Member and Pradip Kumar Kedia, the Accountant Member added.
Thus, the ITAT finally held:
“We thus set aside the order of the CIT(A) and restore the matter back to the file of the Assessing Officer. It shall be open to the Assessing Officer to make such inquiry as he may consider it expedient and pass an assessment order afresh in accordance with law. In the result, the appeal of the assessee is allowed for statistical purposes.”
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