DEVANG ARVINDBHAI DESAI,PADA FALIYU, PALSANA V. INCOME TAX OFFICER, WARD 2 , NAVSARI, GUJARAT

ITA 462/SRT/2024

AI Insights

The case involves two appeals by the same assessee, Devang Arvindbhai Desai, against the orders of the National Faceless Appeal Centre, Delhi/Commissioner of Income Tax (Appeals) for the assessment years 2011-12 and 2013-14. The appeals were directed against the assessment orders passed by the Assessing Officer, which included various additions to the assessee's income on grounds of unexplained credits and undisclosed incomes. The Tribunal noted procedural irregularities in the handling of the appeals by the lower authorities, particularly the lack of adequate opportunity given to the assessee to present his case, leading to the decision to remand the matter back to the Assessing Officer.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 29805 (ITAT-SURAT)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Next Hearing Date: 19-11-2024
• Assessment Year: 2011-2012
• Appeal Filed On: 19-04-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: CHAITALI SHAH
• Keywords: Set aside; Opportunity of being heard; Unexplained cash credit; Unexplained investment
• Section: 148; 144

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. 462 & 463/SRT/2024 (AYs 2011-12 & 2013-14) (Physical court hearing) Devang Arvindbhai Desai 5 87 01 Pada Faliyu, Palsana-394 315 [PAN : AMFPD 7228 J] बनाम Vs Income Tax Officer, Ward-2, Navsari, अपीलाथŎ/Appellant ŮȑथŎ /Respondent िनधाŊįरती की ओर से /Assessee by Ms. Chaitali Shah, CA राजˢ की ओर से /Revenue by Shri Mukesh Jain– Sr-DR अपील पंजीकरण/Appeal instituted on 19.04.2024 सुनवाई की तारीख/Date of hearing 19.11.2024 उद ्घोषणा की तारीख/Date of pronouncement 20.11.2024 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. These two appeals by single assessee are directed against the separate orders of National Faceless Appeal Centre, Delhi/Commissioner of Income tax (Appeals) [for short to as “Ld.CIT(A)”] both dated 24.03.2023 for assessment years (AY) 2011-12 and 2013-14 respectively, which in turn arose out of separate assessment orders passed by Assessing Officer on 23.10.2018. In both appeals, assessee has raised certain common legal ground of appeal on similar set of fact. Therefore, with the consent of both the parties both the appeals were clubbed, heard together and are decided by common order to avoid conflicting decisions. In ITA No.462/SRT/2024, assessee has raised the following grounds of appeal: - ITA Nos.462-463/SRT/2024 (A.Ys.11-12 & 13-14) Devang A Desai 2 “1. On the facts and in circumstances of the case as well as law on the subject, the learned CIT(A) has erred in passing ex-parte order without giving reasonable and sufficient opportunity of being heard. 2. On the facts and in circumstances of the case as well as law on the subject, the learned CIT(A) has erred in dismissing the appeal without passing speaking order. 3. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in re-opening assessment u/s 147 by issuing notice u/s 148 of the I.T. Act, 1961. 4. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs.34,25,940/- on account of alleged unexplained credit entries in the bank account. 5.On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs. 61,758/- on account of undisclosed income being alleged commission income. 6. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs. 4,686/- on account of undisclosed income being alleged interest income from bank deposits. 7. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs.10,00,000/- on account of unexplained income being purchase of immovable property. 8. It is therefore prayed that addition made by Assessing Officer may please be deleted or matter may be please set aside to the Commissioner of Income-tax (Appeals) for deciding a fresh. 9. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” 2. Wherein in ITA No.463/SRT/2024 assessee has raised following grounds of appeal: “1. On the facts and in circumstances of the case as well as law on the subject, the learned CIT(A) has erred in passing ex-parte order without giving reasonable and sufficient opportunity of being heard. ITA Nos.462-463/SRT/2024 (A.Ys.11-12 & 13-14) Devang A Desai 3 2. On the facts and in circumstances of the case as well as law on the subject, the learned CIT(A) has erred in dismissing the appeal without passing speaking order. 3. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in re-opening assessment u/s 147 by issuing notice u/s 148 of the I.T. Act, 1961. 4. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs.34,45,152/- on account of alleged unexplained credit entries in the bank account. 5. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs.1,69,511/- on account of undisclosed income being alleged commission income. 6. On the facts and in circumstances of the case as well as law on the subject, the learned Assessing Officer has erred in making the addition of Rs.5,133/- on account of undisclosed income being alleged interest income from bank deposits. 7. It is therefore prayed that addition made by Assessing Officer may please be deleted or matter may be please set aside to the Commissioner of Income-tax (Appeals) for deciding a fresh. 8. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” ITA No.462/Srt/2024 (AY 11-12) 3. Rival submissions of both the parties have been heard and record perused. The Ld. Authorized Representative (Ld.AR) for the assessee submits that Ld. CIT(A) dismissed the appeal in ex parte by taking view that a number of opportunities were given as recorded in para-5 of his order that assessee failed to provide any reasonable and cogent arguments. The Ld. AR of the assessee submits that assessee has filed written submission on 10.01.2019, copy of such submission is filed on record. The Ld. CIT(A) has not considered such fact. The assessee while filling details in Form-35, opted option as “No” for service of ITA Nos.462-463/SRT/2024 (A.Ys.11-12 & 13-14) Devang A Desai 4 notices through e-mail, in Form-35. The assessee has not in habit and practice to check his e-mail as he is not well versed with electronic gadgets. In fact, no notice in physical form during pendency of first appeal was ever served upon the assessee, which resulted in non-compliance. The assessee is not allowed fair and reasonable opportunity by ld CIT(A). The Assessing Officer also passed the assessment order under section 144 of the Act. Thus, in the interest of justice, instead of restoring the matter to ld CIT(A), the matter may be restored back to the file of Assessing Officer, to avoid the long drawn process of remand report. with the direction to allow a reasonable opportunity of being heard to assessee. The Ld. AR of the assessee submits that she undertakes on behalf of assessee to be more vigilant in making timely compliance as and when called for. 4. On the other hand, Ld. Sr-DR for the Revenue supported the order of lower authorities. The ld Sr DR for the revenue submits that assessee was given sufficient opportunities by Assessing Officer as well as more than reasonable opportunities by Ld. CIT(A). The assessee does not deserve any further leniency. 5. We have considered the rival submissions of both the parties and have gone through order of lower authorities carefully. We find that in assessment year 2011-12, the Assessing Officer made various additions on account of unexplained cash deposits and credit of Rs. 34,254,940/- and 4,683/-, undisclosed commission income of Rs. 61,758/- on the basis of record of Form- 26AS and unexplained investment of Rs.10,00,000/-. All the additions were made for the want of proper explanation by assessee. The Ld. CIT(A) confirmed ITA Nos.462-463/SRT/2024 (A.Ys.11-12 & 13-14) Devang A Desai 5 the action of Assessing Officer in ex parte proceedings. Considering the overall facts and circumstances and the submission of Ld. AR of the assessee that assessee while fling appeal before Ld. CIT(A) in Form-35 opted option “no” of the service of notice through e-mail and the fact that Ld. CIT(A) has not considered the written submission already filed by assessee on 10.09.2019, 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 and in accordance with law. 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. ITA No.463/SRT/2024 (AY.13-14) 6. The ld AR for assessee and ld Sr DR for the revenue made similar submissions as made in appeal for AY 2011-12. 7. On considering the submissions of both the parties, we find that Assessing Officer made additions on account of unexplained credit for Rs.34,45,152/- and Rs. 5,133/- in various bank accounts. The Assessing Officer also made addition of Rs.1,69,511/- on the basis of details in 26AS on account of undisclosed commission income. Considering the fact that lower authorities have passed their respective ex parte proceedings. Therefore, keeping in view the facts that almost on similar facts, we have restored the appeal for ATY 2011-12 in ITA No.462/Srt/2024 to the file of Assessing Officer, thus, following the principle of ITA Nos.462-463/SRT/2024 (A.Ys.11-12 & 13-14) Devang A Desai 6 consistency the appeal is also restored back to the file of Assessing Officer with similar directions. 8. In the result, both appeals are allowed for statistical purposes. Registry is directed to place one copy of this order in all appeals folder / case file(s). Order pronounced in the open court on 20/11/2024. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PAWAN SINGH) लेखा सद˟/Accountant Member Ɋाियक सद˟/Judicial Member सूरत / Surat Dated: 20/11/2024 Dkp Outsourcing Sr. P.S* 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 "