DEELIP GANPATRAO KORDE,NASHIK V. ACIT CIRCLE 1 , NASHIK

ITA 1373/PUN/2024

AI Insights

The case involves Deelip Ganpatrao Korde, who appealed against the order of the Commissioner of Income Tax (Appeals) confirming an addition of Rs. 74,64,500 under section 68 of the Income Tax Act, 1961, due to alleged unexplained cash deposits during the demonetization period. The assessee argued that he was not properly notified of the assessment proceedings as the notices were sent to his former tax consultant's email, and he was unaware of them due to health issues. The Tribunal found merit in the assessee's request for a de novo hearing, acknowledging the procedural shortcomings in the notice delivery.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 30106 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 23-10-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 18-06-2024
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAMNATH P MURKUNDE
• Assessee Lawyers: SANKET M JOSHI
• Keywords: Set aside; Opportunity of being heard; Revised return
• Section: 144; 250; 68; 274

Judgement Text

" ।आयकर अपीलीय अिधकरण ”ए” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A” :: PUNE BEFORE DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.1373/PUN/2024 िनधाᭅरण वषᭅ / Assessment Year : 2017-18 Deelip Ganpatrao Korde, Shop No.1, Purvi Apt Behind Sai Palace, Chetna nagar, Nashik – 422009. PAN: AFNPK2831F V s The Assistant Commissioner of Income Tax, Circle-1, Nashik. Appellant / Assessee Respondent / Revenue Assessee by Shri Sanket M Joshi – AR Revenue by Shri Ramnath P Murkunde - DR Date of hearing 23/10/2024 Date of pronouncement 23/10/2024 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is an appeal filed by the Assessee directed against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], under section 250 of the Income tax Act 1961, dated 16.05.2024. The assessee has raised the following grounds of appeal : “1. The learned CIT(A) erred in confirming the addition of Rs.74,64,500 u/s 68 towards alleged unexplained cash deposits during demonetization period made by the A.O. in the ex-parte asst, order u/s 144 on the ground that the appellant had failed to explain source of ITA No.1373/PUN/2024 2 the cash deposits in the course of the ex-parte asst, proceedings without appreciating that the said addition was not justified on facts and in law. 2. The appellant submits that the notices issued by the A.O. were not served physically by post but the same were served only on the email id. [e-mail] belonging to the erstwhile tax consultant who had not informed the appellant about receipt of such notices and therefore, it is prayed that in the interest of justice, the matter may please be set aside to the file of the A.O. for conducting asst, afresh after providing one more opportunity of being heard to the appellant. 3. The appellant submits that out of the two notices issued by C1T(A), the first notice dated 05.02.2021 was issued on the email id [e-mail] belonging to the erstwhile tax consultant whereas the second notice dated 29.04.2024 issued on the appellant’s email id went unnoticed from the side of the appellant senior citizen who was not keeping well due to heart and kidney issues during the said period and it is prayed that in the interest of justice, the matter may please be set aside to the file of the A.O. for conducting asst, afresh after giving one more opportunity of being heard to the appellant. 4. The appellant craves leave to add/ alter/ amend any of the grounds of appeal.” Submission of ld.AR : 2. Ld.AR for the Assessee submitted as under : “1. The appellants accounting and audit assignment was handled by a certain tax practitioner, who had also registered his own email id ITA No.1373/PUN/2024 3 i.e.prashant.clientsatgmail.com as the appellants email id on the official income tax e- filing website i.e. www.incometaxindia.gov.in. 2. The appellant received notices from the learned Assessing Officer under different sections of the Income Tax Act, 1961 like 143(2), 142(1), 272(l)(d) on the email id available. 3. The appellant was not on good terms with the said practitioner. However, even then he contacted the said practitioner after receiving physical copy of the assessment order. The practitioner had not informed the appellant of the various notices received previously and of the information required by the learned Assessing Officer nor did he respond well in time to the assessment order, thereby causing delay in filing appeal. 4. The appellant did not produce the required information as he was oblivious of any notice issued to him on the above mentioned email id. Owing to lack of information, the earned Assessing Officer completed the assessment under section 144 of the Income Tax Act, 1961 and issued the assessment order. Notice under section 274 read with section 271AAC(l)(c) of the Income Tax Act, 1961 was also issued for unexplained cash deposits. Consequently, the learned Assessing Officer has computed total income for the previous year by adding Rs. 7464500.00.” 2.1 Ld.AR humbly requested that one more opportunity may kindly be provided to explain cash deposits. He further submitted that Assessee has been filing Return of Income regularly and Assessee’s books of accounts are audited. ITA No.1373/PUN/2024 4 Submission of ld.DR : 3. Ld.DR for the Revenue relied on the order of the Assessing Officer. However, accepted that in the peculiar facts of the case, order may be set-aside for denovo adjudication. Findings & Analysis : 4. We have heard both the parties and perused the records. It is observed that Assessee had filed Return of Income for A.Y.2017- 18 electronically, on 02.12.2017 declaring total income at Rs.20,81,520/-. Then, Assessee filed revised return declaring total income of Rs.20,31,970/-. Assessee’s case was selected for scrutiny. The AO issued various notices including show cause notice, but Assessee failed to file any reply. In the assessment order, AO has observed that assessee had deposited cash during the Demonetization Period of Rs.74,64,500/- in the bank accounts mentioned in the assessment order. The AO made addition of Rs.74,64,500/- u/s.68 of the Act. Ld.CIT(A) confirmed the addition. The relevant part of the ld.CIT(A)’s order is reproduced here as under: “It is observed that during the year under consideration, the appellant has deposited cash of Rs.74,64,500/- during demonetization period from 09/11/2019 to 31/12/2019 in his ITA No.1373/PUN/2024 5 different saving Bank Accounts maintained by him during the year with. During the course of assessment proceedings, the AO held that the appellant has not furnished details about the nature and source of cash deposits. The appellant has not offered any cogent explanation regarding cash deposits. Thus the nature and source of cash deposit of Rs.74,64,500/- remained unexplained. In view of the facts and circumstances of the case, the AO was justified in making addition of Rs.74,64,500/- on account of cash deposits u/s.68 of the I.T. Act. The facts and circumstances of case laws relied upon by the appellant are not applicable to the facts and circumstances of the case. No other evidence had been filed by the appellant during the appellate proceedings. In view of the above facts, and the findings of the AO, I do not find any infirmity in the order passed by the AO in treating the amount of Rs.74,64,500/- as unexplained cash deposits. Accordingly, the addition of Rs.74,64,500/- is confirmed and ground of appeal is dismissed.” 4.1 Thus, ld.CIT(A) has merely confirmed the addition without discussing on merits of the addition. The ld.Counsel for the assessee submitted that Assessee had not received the various notices issued by Assessing Officer(AO) as those notices were served on the Email Id of the Assessee’s Income Tax Practitioner(ITP). Ld.Counsel explained that ITP had not informed the assessee and failed to reply the notices. It is observed that ITA No.1373/PUN/2024 6 assessee is in the business of providing security services. Assessee has been filing Return of Income. 5. In these facts and circumstances of the case, we agree with ld.AR that Assessee may be provided one more opportunity. Hence, the order of ld.CIT(A) is set-aside to ld.CIT(A) for denovo adjudication. The ld.CIT(A) shall provide opportunity of hearing to the assessee. Assessee shall file all the necessary details. 6. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 23rd October, 2024. Sd/- Sd/- (VINAY BHAMORE) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 23rd Oct, 2024/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. ITA No.1373/PUN/2024 7 आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune. "