ASHOKBHAI KANJIBHAI DANKHARA,SURAT V. ITO, WARD-3(3)(1), SURAT

ITA 486/SRT/2024

AI Insights

The case involves Ashokbhai Kanjibhai Dankhara, the appellant, contesting an order from the National Faceless Appeal Centre/Commissioner of Income Tax (Appeals) which confirmed an addition of Rs.1,25,66,385 as unexplained investment under section 69 of the Income Tax Act, 1961. The appellant argued that the order was passed ex-parte without adequate opportunity to be heard, and that there was a procedural error in the service of the notice. The Tribunal found merit in the appellant's claims regarding the non-service of the order and the inadequate notice period provided for compliance, leading to the decision to restore the matter to the Assessing Officer.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 29807 (ITAT-SURAT)
• Duration Of Justice: 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Next Hearing Date: 18-11-2024
• Assessment Year: 2016-2017
• Appeal Filed On: 26-04-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: BIPIN JARIWALA
• Keywords: Set aside; Opportunity of being heard; Reasonable cause; Unexplained investment
• Section: 143(3); 271(1)(c); 69

Judgement Text

" आयकर अपीलीय अिधकरण, सूरत Ɋायपीठ, सूरत IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 486/SRT/2024 (AY 2016-17) (Physical court hearing) Ashokbhai Kanjibhai Dankhara C-12, Laxman Nagar, L.H. Road, Varachha, Surat-395006 [PAN : AAKPD 7502 N] बनाम Vs Income Tax Officer, Ward- 3(3)(1), Surat, Aayakar Bhawan, Near Majura Gate, Opp. New Civil Hospital, Surat- 395 001 अपीलाथŎ/Appellant ŮȑथŎ /Respondent िनधाŊįरती की ओर से /Assessee by Shri Bipin Jariwala, CA राजˢ की ओर से /Revenue by Shri Mukesh Jain– Sr-DR अपील पंजीकरण/Appeal instituted on 26.04.2024 सुनवाई की तारीख/Date of hearing 18.11.2024 उद ्घोषणा की तारीख/Date of pronouncement 18.11.2024 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee is directed against the order of National Faceless Appeal Centre, Delhi/Commissioner of Income tax (Appeals) [for short to as “NFAC/Ld.CIT(A)] dated 30.05.2023 for assessment year (AY) 2016-17, which in turn arises out of assessment order passed by Assessing Officer under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) 26.12.2018. The assessee has raised following grounds of appeal: “1. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in making addition of Rs.1,25,66,385/- on account of alleged unexplained investment u/s 69 of the Income Tax Act, 1961. ITA No.486/SRT/2024 (A.Y.16-17) Ashokbhai K Dankhara 2 2. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has not offered adequate opportunities to hear the case and passed ex-parte order and hence the case may please be set aside and restored back to the CIT(A) or AO. 3. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Office in initiating penalty u/s 271(1)(c) of the Income Tax Act, 1961. 4.It is therefore prayed that the above addition may please be deleted as learned members of the Tribunal may deem it proper. 5. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” 2. Rival submission of both the parties have been heard and record perused. The Ld. Authorized Representative (Ld.AR) of the assessee submits that there is delay of 272 days in filing appeal before Tribunal. The impugned order passed by Ld.CIT(A) on 30.05.2023. However, this appeal is filed on 26.04.2024. The Ld.AR of the assessee submits that delay in filing appeal is neither intentional nor deliberate. In fact, the impugned order was not served upon the assessee either in physical form or by way of e-mail. At the time of filing appeal, the assessee for the purpose of service of notice of hearing has given e-mail id. of [e-mail]. No notice of hearing of appeal was sent or served on the assessee. In first week of April, 2024, when assessee approached before his CA to know about the status of his appeal, and on checking Income tax e- filing portal, his CA came to know about dismissal of appeal. The assessee immediately deposited appeal filing fees of Rs. 10000/-, on 11.04.2024 and this appeal was filed on 26.04.2024. On further checking ITBA system, it was ITA No.486/SRT/2024 (A.Y.16-17) Ashokbhai K Dankhara 3 found that notice of hearing of appeal was sent at the e-mail of [e-mail]. The assessee has filed copy of screen shot of ITBA portal showing issuance of notice at [e-mail]. The said e- mail address does not belong to the assessee or his CA, therefore, neither the assessee was aware nor there was any occasions for compliance before ld CIT(A). Resultantly, the Ld.CIT(A) passed ex parte order. The Ld. AR of the assessee submits that there is reasonable cause for not filing submission before Ld.CIT(A) as well as filing appeal within 60 days of passing the impugned order, before Tribunal. The Ld. AR of the assessee prayed that delay in filing appeal before Tribunal may be condoned. On merit, the Ld. AR of the assessee submits that assessment order was also passed without giving fair and reasonable opportunity of being heard to assessee. The Assessing Officer issued show cause notice on 24.12.2018 seeking certain details about the unsecured loan about the source of investment. Tn the said the show cause notice dated 24.12.2018, only two days’ time was allowed, and assessment order was passed on 26.12.2018. Thus, no reasonable time was allowed to assessee. The Ld. AR of the assessee submits that matter may be restored to the file of Assessing Officer with the direction to allow fair and reasonable opportunities to assessee and pass order afresh in accordance with law. He undertakes on behalf of the assessee to be more vigilant in future in making timely compliance. 3. On the other hand, Ld. Senior Departmental Representative (Ld. Sr-DR) for the Revenue submits that Assessing Officer has given ample opportunities to the assessee as reflected in the show cause notice dated 24.12.2018 itself, but ITA No.486/SRT/2024 (A.Y.16-17) Ashokbhai K Dankhara 4 the assessee has not made any compliance. In case, the Bench is of the view that assessee deserves any more opportunity, the matter may be restored back to the file of Ld.CIT(A). On the plea of condonation of delay, Ld. Sr-DR for the Revenue submits that Bench may be taken appropriate view in accordance with law. 4. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. First, we are considering the plea of condonation of delay. On perusal of Form-35 [Appeal form before CIT(A)], we find that assessee while filing appeal has given e-mail id. [e-mail]. No notice was sent or served through such e-mail address. On careful perusal of screen shot of ITBA portal, copy of which is place before us, we find that notice as well as cc (carbon copy) was sent at the e-mail of [e-mail]. Thus, we find merit in the submission of Ld. AR of the assessee about reasonable cause for non-compliance before Ld.CIT(A) as well as non-service of impugned order passed by LD. CIT(A), which ultimately resulted in delay in filing appeal before Tribunal. Considering the overall facts and circumstances of the case and the submission of Ld. AR of the assessee, delay in filing appeal is condoned. Now adverting to merits of the case. 5. We find that during assessment proceedings, Assessing Officer issued show cause notice on 24.12.2018 to furnish complete documentary evidence by 26.12.2018. The Assessing Officer passed assessment order on26.12.2018 itself. In the show cause notice issued on 24.12.2018, the Assessing Officer asked about details of unsecured loan of Rs.1.16 crores and such details was ITA No.486/SRT/2024 (A.Y.16-17) Ashokbhai K Dankhara 5 sought for the first time in show cause notice issued on 24.12.2018. In our considered view, no reasonable and fair opportunities were allowed by Assessing Officer. The order of Assessing Officer was upheld by Ld.CIT(A) in ex parte proceedings. Thus, considering the overall facts and circumstances of the case, we instead of going through into further merit or demerits of the case, we deem it appropriate to restore the grounds of appeal raised by assessee to the file of Assessing Office to pass assessment order to pass the order afresh. Needless to direct the Assessing Officer shall grant opportunity of being heard to assessee. The assessee is also directed to provide all evidences and information again to the Assessing Officer as and when required. In the result, grounds of appeal raised by assessee are treated allowed for statistical purposes. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 18/11/2024. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PAWAN SINGH) लेखा सद˟/Accountant Member Ɋाियक सद˟/Judicial Member सूरत / Surat Dated: 18 /11/2024 Dkp Outsourcing Sr.P.S* ITA No.486/SRT/2024 (A.Y.16-17) Ashokbhai K Dankhara 6 आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to :  अपीलाथŎ/ The Appellant  ŮȑथŎ/ The Respondent  आयकर आयुƅ/ CIT  िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, सूरत/ DR, ITAT, SURAT  गाडŊ फाईल/ Guard File // True Copy // By order/आदेश से, सहायक पंजीकार आयकर अपीलीय अिधकरण, सूरत "