ARCOT AFSAR BEGUM,TADIPATRI V. INCOME TAX OFFICER, WARD-1, ANANTAPUR

ITA 1134/HYD/2025

AI Insights

Ms. Arcot Afsar Begum, the appellant, contested the orders of the Income Tax Officer, Ward-1, Anantapur, and the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, regarding the assessment year 2013-14. The case involved the reassessment of unexplained cash deposits amounting to Rs.29,92,000 in the assessee's bank account, which led to the reopening of her case under section 147 of the Income Tax Act, 1961. The AO completed the assessment on a best judgment basis due to non-compliance by the assessee in filing returns or responding to notices. The CIT(A) dismissed the appeal ex-parte due to similar non-compliance. The Tribunal found that the assessee had not been given a fair opportunity to be heard, particularly noting that only one notice was issued before the dismissal of the appeal by the CIT(A).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 775685 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 04-07-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANKAR PANDI P
• Assessee Lawyers: G. V. REDDY
• Keywords: Set aside; Opportunity of being heard; Reassessment proceedings; Principle of natural justice
• Section: 147; 148; 144

Judgement Text

" आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘SM’ Bench, Hyderabad श्री विजय पाल राि, उपाध् यक्ष एिं श्री मिुसूदन सािडिया, लेखा सदस् य क े समक्ष । BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.1134/Hyd/2025 (निर्धारण वर्ा/Assessment Year:2013-14) Ms. Arcot Afsar Begum, Tadipatri. PAN:AJOPA1727D Vs. Income Tax Officer, Ward-1, Anantapur. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri G. V. Reddy, Advocate रधजस् व द्वधरध/Revenue by: Shri Sankar Pandi P, SR-DR सुिवधई की तधरीख/Date of hearing: 08/09/2025 घोर्णध की तधरीख/Pronouncement: 12/09/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by Ms. Arcot Afsar Begum (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 27.01.2025 for the A.Y. 2013-14. 2. At the outset, it is noted that there is a delay of 95 days in filing of the present appeal. The assessee has filed a condonation petition along with an affidavit explaining the reasons for the delay. In this Printed from counselvise.com ITA No.1134/Hyd/2025 2 regard, the Learned Authorised Representative (“Ld. AR”) submitted that the assessee is a small businessman having limited knowledge of tax litigation, procedures and statutory timelines. Due to lack of proper professional assistance within time, the appeal could not be filed before the Tribunal within the prescribed period. It was contended that the delay is neither willful nor deliberate but has occurred on account of genuine and bona fide reasons. Accordingly, he prayed for condonation of the delay in the interest of substantial justice. 3. Per contra, the Learned Departmental Representative (“Ld. DR”) did not raise any serious objection to the prayer of the assessee. 4. We have carefully considered the submissions of both sides and perused the condonation petition along with the affidavit placed on record. On perusal of the same, we are satisfied that the assessee has shown a reasonable and bona fide cause for the delay in filing the appeal. It is well settled that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. In view of the above facts and circumstances, and there being no serious objection from the Revenue, we condone the delay of 95 days in filing of the appeal. Accordingly, the appeal is admitted for adjudication on merits. 5. The assessee has raised the following grounds of appeal : Printed from counselvise.com ITA No.1134/Hyd/2025 3 Printed from counselvise.com ITA No.1134/Hyd/2025 4 6. The brief facts of the case are that, the assessee is an individual who did not file the return of income for the A.Y. 2013-14. On the basis of information available, the Ld. Assessing Officer (“Ld. AO”) noticed that the assessee had deposited cash of Rs.29,92,000/- in his bank account during the year under consideration. Accordingly, the case of the assessee was reopened under section 147 of the Income Tax Act, 1961 (“the Act”) and notice under section 148 of the Act was issued to the assessee on 29.03.2021. During the reassessment proceedings, the assessee neither filed any return of income nor responded to the various statutory notices issued by the Ld. AO. Consequently, the Ld. AO proceeded to complete the assessment on Printed from counselvise.com ITA No.1134/Hyd/2025 5 best judgment basis and passed the order under section 147 read with section 144 read with section 144B of the Act on 28.03.2022, treating the cash deposits of Rs.29,92,000/- as unexplained money under section 69A of the Act. 7. Aggrieved with the order of Ld. AO, the assessee preferred appeal before the Ld. CIT(A). However, even before the appellate authority, the assessee failed to comply with the notices issued. As a result, the Ld. CIT(A) dismissed the appeal ex-parte. 8. Aggrieved with the order of Ld. CIT(A), the assessee has now come in appeal before the Tribunal. The Ld. AR submitted that the order of the Ld. CIT(A) suffers from violation of the principles of natural justice. He invited our attention to para no. 5 of the order of the Ld. CIT(A) to point out that only one notice dated 03.10.2024 was issued before dismissing the appeal. It was contended that sufficient opportunity of being heard was not provided to the assessee. The Ld. AR further submitted that since the assessee’s case had already remained non-prosecuted before the Ld. AO also, in the interest of justice, the matter may be restored to the file of the Ld. AO with one more opportunity to the assessee to substantiate his case. 9. Per contra, the Ld. DR supported the orders of the lower authorities. He submitted that, the assessee has been already provided adequate opportunity by the lower authorities. Hence, no further opportunity shall be provided to the assessee. Printed from counselvise.com ITA No.1134/Hyd/2025 6 10. We have heard the rival submissions and perused the material available on record. It is undisputed that both before the Ld. AO as well as before the Ld. CIT(A), the assessee failed to properly prosecute the case. However, from para no.5 of the order of the Ld. CIT(A), it is evident that only one notice dated 03.10.2024 was issued before dismissing the appeal, which in our considered view does not satisfy the requirement of affording adequate and effective opportunity of being heard. It is a settled position that adherence to the principles of natural justice is a fundamental requirement of adjudication. Since the assessee did not get effective opportunity either before the Ld. CIT(A) and the Ld. AO has no opportunity to decide the issue on merits, we are inclined to restore the matter to the file of the Ld. AO. Accordingly, the impugned orders are set aside and the issue is remanded to the file of the Ld. AO with a direction to afford one more effective opportunity of being heard to the assessee. The assessee shall also be at liberty to file necessary evidence and explanation in support of his claim. At the same time, the assessee is directed to extend full cooperation in the assessment proceedings and not to seek unnecessary adjournments. Printed from counselvise.com ITA No.1134/Hyd/2025 7 11. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 12th Sept., 2025. Sd/- Sd/- (VIJAY PAL RAO) (MADHUSUDAN SAWDIA) VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad. Dated: 12.09.2025. * Reddy gp Copy of the Order forwarded to : 1. Ms. Arcot Afsar Begum, 13-364, Bukkapatnam Street, Tadipatri- 515411 Anantapur District. 2. The ITO, Ward-1, Anantapur. 3. Pr.CIT, Kurnool . 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, Printed from counselvise.com "