ASWATHNARAYANAIAH RATHNAMMA RAAMESH,BANGALORE V. INCOME TAX OFFICER, WARD-4(3)(3), BANGALORE

ITA 188/BANG/2025

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The case involves Aswathnarayanaiah Rathnamma Raamesh, the appellant, contesting the orders of the Income Tax Officer (ITO) and the Commissioner of Income Tax (Appeals) [CIT(A)]. The appellant's income tax return for the assessment year 2017-18 was scrutinized, leading to the addition of unexplained cash deposits and agricultural income as income from other sources. The CIT(A) dismissed the appeal for non-prosecution and on merits, which the appellant contested, citing a wrong email ID was used for communication. The Income Tax Appellate Tribunal (ITAT) found merit in the appellant's argument regarding the email issue and remitted the case back to the AO for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 24917 (ITAT-BANGALORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SUDHEENDRA B R.
• Keywords: Opportunity of being heard; Unexplained investment; Salary income; Principle of natural justice
• Section: 144; 250; 69; 133(6); 69A; 234B; 80C

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH : BANGALORE BEFORE SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No.188/Bang/2025 Assessment year : 2017-18 Aswathnarayanaiah Rathnamma Raamesh, 234, Anekal Road, Sadashiva Nagar, Anekal, Bangalore – 562 107. PAN: AFSPR 2593G Vs. The Income Tax Officer, Ward 4(3)(3), Bangalore. APPELLANT RESPONDENT Appellant by : Shri Sudheendra B R., Advocate Respondent by : Ms. Neha Sahay, Jt.CIT(DR)(ITAT), Bengaluru. Date of hearing : 25.03.2025 Date of Pronouncement : 28.03.2025 O R D E R Per Laxmi Prasad Sahu, Accountant Member This appeal of the assessee is preferred against the order of arising out of the order passed by the ld. CIT(Appeals), National Faceless Appeal Centre, Delhi (NFAC), Delhi dated 18.11.2024 having DIN ITBA/NFAC/S/250/2024-25/1070413069(1)for the assessment year 2017-18 on the following grounds:- ITA No.188/Bang/2025 Page 2 of 6 “ 1. General ground: 1.1. The learned Commissioner of Income Tax, Appeals (hereinafter referred to as CIT (A) for short) has erred in passing the appellate order under section 250 in the manner passed by him. The order so passed is bad in law and liable to be quashed. 2. Assessment order passed under section 144 in violation of principles of natural justice 2.1 The learned ITO, Ward 5(3)(2), Bangalore erred in passing the assessment order under section 144 without providing proper opportunity of being heard, without providing sufficient time to respond to show cause notice and without properly considering the replies, information and documents submitted during the assessment proceedings. 2.2 The assessment order passed by the learned AO is thus bad in law and liable to be quashed. 3. Dismissal of appeal by CIT(A) for non-prosecution 3.1. The learned CIT(A) has erred in dismissing the appeal for non-prosecution and on merits of the case. The Appellant was not able to respond to the notices due to genuine and bona fide reasons. 3.2. On facts and circumstances of the case and law applicable, impugned order passed by the CIT(A) dismissing the appeal is bad in law and liable to be quashed. 4. Addition of cash deposits — Rs. 38,84,000 4.1 Without prejudice, the learned AO erred in making addition of Rs. 38,84,000 in respect of cash deposits of Rs. 38,84,000 to bank accounts as unexplained investment under section 69 of the Act. 4.2 On facts and circumstances of the case and law applicable, impugned addition of Rs. 38,84,000 under section 69 is bad in law and liable to be quashed. 5. Addition of agricultural income of Rs. 72,50,000 ITA No.188/Bang/2025 Page 3 of 6 5.1 The learned AO erred in making addition of Rs. 72,50,000 to Income from other sources in respect of agricultural income of Rs. 72,50,000 declared by the appellant in the return of income. 5.2 The learned AO erred in making the impugned addition without providing sufficient time to submit the details and documents called for. 5.3 On facts and circumstances of the case and law applicable, addition of agricultural income Rs. 72,50,000 as income from other sources should be fully deleted. 6. Levy of interest under section 234A and 234B 6.1. The learned AO erred in levying the interest u/s 234A and 234B. On the facts and circumstances of the case and law applicable, levy of interest u/s 234A and 234B is incorrect and bad in law. The appellant denies its liability to pay the interest u/s 234A and 234B. 7. Prayer: 7.1. Based on the above grounds and other grounds adduced at the time of hearing, the appellant prays that the assessment order passed by the learned AO under section 144 and the order passed by the learned CIT(A) under section 250 be quashed or in alternative the above grounds and relief prayed thereof be allowed.” 2. Briefly stated the facts of the case are that the assessee filed return of income in ITR-2 on 25.3.2018 declaring gross total income of Rs.5,02,800 which constituted salary income of Rs.4,14,000, income from house property of Rs.84,000 and income from other sources of Rs.4,800. The assessee claimed deduction under Chapter VIA u/s. 80C of Rs.1,74,800. The case was selected for scrutiny under CASS and statutory notices were issued to the assessee. There was no response from the assessee’s side. The AO collected information u/s. 133(6) ITA No.188/Bang/2025 Page 4 of 6 from SBI, Sadashiv Nagar, Bangalore and Canara Bank, Hosur. The assessee has deposited cash in two bank accounts of Rs.38,84,000 (2,29,000 + 12,55,000). The AO issued various notices to the assessee which was not complied. Therefore for want of proper explanation from the assessee, the entire cash deposited was treated as income u/s. 69A of the Act. 3. Aggrieved, the assessee filed appeal before the CIT(Appeals) with a delay of 1017 days including the COVID pandemic period. The ld. CIT(Appeals) condoned the delay in filing the appeal and issued various notices on different dates and notices were issued through ITBA portal on the email provided by the assessee. But there was no response from the assessee. The ld. CIT(A) after relying on various judgments confirmed the assessment order. Aggrieved, the assessee is in appeal before the ITAT. 4. The ld. AR submitted that the email provided by the assessee while filing the appeal was never responded since it belongs to others and assessee came to know only when he filed return of income for the later year and observed that the ld. CIT(A) has disposed of the appeal ex parte. The ld. AR submitted that the correct email id of the assessee is [e-mail] and undertook that if a chance is given to the asse, the assessee will substantiate the entire amount of cash deposit in the two bank accounts. 5. The ld. DR relied on the order of lower authorities and submitted that both the parties have given fair chances to the assessee. If the ITA No.188/Bang/2025 Page 5 of 6 email does not belong to the assessee, the assessee should have updated the correct email id in the income tax web portal and he should have checked regularly about the appeal proceedings before the CIT(A). The ld. CIT(A) has condoned the inordinate delay. 6. Considering the rival submissions, we note that the assessee has deposited cash in his bank account as noted by the AO in the assessment order and before both the lower authorities the assessee has not responded. During the course of hearing as submitted by the ld. AR of the assessee, the email provided by the assessee is wrong and correct email id is provided as of date. Therefore considering the facts of the case and in the interest of justice, we remit the matter back to the file of the AO for fresh consideration and the AO is directed to issue notice on the email id provided by the assessee as noted supra. The assessee is directed to cooperate in the income tax proceedings and not to seek unnecessary adjournment for early disposal of the case. In case of failure, second leniency shall not be granted to the assessee. 7. In the result, the appeal of the assessee is allowed for statistical purposes. Pronounced in the open court on this 28th day of March, 2025. Sd/- Sd/- ( KESHAV DUBEY) ( LAXMI PRASAD SAHU ) JUDICIAL MEMBER ACCOUNTANT MEMBER Bangalore, Dated, the 28th March, 2025. /Desai S Murthy / ITA No.188/Bang/2025 Page 6 of 6 Copy to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. DR, ITAT, Bangalore. By order Assistant Registrar ITAT, Bangalore. "