Non-reply to Notice due to miscommunication between assessee and Tax Consultant: ITAT directs CIT(A) Denovo Adjudication [Read Order]

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed the Commissioner of Income Tax Appeals (CIT(A)) denovo adjudication as the non-reply to the notice was due to some miscommunication between assessee and the tax consultant.

Here the case of assessee, Mohanlal S. Gachi was reopened on the basis of AIR information that the assessee had cash deposit in the bank account. During the course of assessment proceedings, the assessee explained that the cash amount received on various dates was in respect of jewellery making labour charges. The Assessing Officer made addition based on peak cash credit under Section 68 of the Income Tax Act, 1961.

Aggrieved by the assessment order dated 17/12/2018 passed under Section 143(3) read with Section 147 of the Income Tax Act, the assessee filed appeal before the CIT(A). The CIT(A) issued notice to the assessee. On 17/02/2023 the assessee filed letter seeking adjournment. On the next date of hearing, 06/03/2003 the assessee was ready with reply but due to some miscommunication the Tax Consultant could not upload the reply. The CIT(A) dismissed the appeal ex-parte on 09/03/2023.

Bhupendra Shah who appeared on behalf of the assessee stated that the assessee would have appear before the CIT(A), if an opportunity was afforded to him to represent the case before the CIT(A).

Sunny Kachhwaha on behalf of the revenue submitted that sufficient opportunity was granted to the assessee by CIT(A), however, the assessee had failed to make submissions before the CIT(A). He also contented that even before, the Assessing Officer assessee had not filed documentary evidence to support his contention.

A Single Bench of Vikas Awasthy, (Judicial Member) observed that the assessee had appeared before the CIT(A) on 17/02/2023 and sought adjournment. The case was adjourned to 06/03/2023. On the said date, there was no response from the assessee. Consequently, the CIT(A) decided the appeal in an ex-parte proceeding.

The Bench allowed the appeal filed by the assessee restoring the matter to the file of CIT(A) for denovo adjudication, pointing out that the reply to be furnished on 06/03/2023 was ready but could not be upload on portal due to some communication gap between the assessee and the Tax Consultant.

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