GOVINDBHAI ATMARAM THAKOR,AHMEDABAD V. THE ITO, WARD-3(1)(1), AHMEDABAD

ITA 1629/AHD/2024

AI Insights

The case involves Govindbhai Atmaram Thakor, an agriculturist and employee of Modern Denim Ltd., who appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. The appeal was against the addition of Rs. 18,01,075 as unexplained income from cash deposits during the demonetization period. The Assessing Officer had initially made this addition under Section 69A of the Income Tax Act, following an ex-parte assessment under Section 144 due to the assessee's non-response to notices. The CIT(A) upheld this addition, leading to the current appeal. The Tribunal found procedural lapses in the notice issuance and hearing process, leading to the decision to remand the case for a fair hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 25853 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Section 250, Section 142(1), Section 144(1)(b), Section 69A, Section 139
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C DHARANI NATH
• Assessee Lawyers: S.N. DIVATIA
• Keywords: Additional evidence; Principle of natural justice
• Section: 144; 142(1); 250; 69A; 139

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A. No. 1629/Ahd/2024 (Assessment Year: 2017-18) Govindbhai Atmaram Thakor, 5/30, Sonara Vas, Chandisar Mastarpura, Chandisar, Dholka, Ahmedabad-382260 Vs. Income Tax Officer, Ward-3(1)(1), Ahmedabad [PAN No.ASPPT2515A] (Appellant) .. (Respondent) Appellant by : Shri S. N. Divatia, A.R. Respondent by : Shri C Dharani Nath, Sr. D.R. Date of Hearing 31.12.2024 Date of Pronouncement 01.01.2025 O R D E R The appeal filed by the assessee is against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi on 09.08.2023 for A.Y. 2017-18. 2. The grounds of appeal raised by the assessee are as under: “1.1 The order passed by U/s. 250 on 09.08.2023 for AY 2017-18 by NFAC, [CIT(A)], Delhi (for short CIT(A)” upholding the addition of Rs. 18l01,075/- made by A.O. towards cash deposits/credit in bank accounts as unexplained income is wholly illegal, unlawful and against the principles of natural justice. 1.2 The ld. CIT(A) has failed to appreciate that the appellant is not highly educated, nor computer savvy so that he was not in position to access to the IT Portal and as such he was unaware about the notices of hearing issued by both the lower authorities which resulted into ex-parte assessment u/s. 144 and addition of Rs. 18,01,075/-. Therefore, the additional evidence produced during the hearing of this appeal may be admitted. There was a sufficient cause for failure to respond to the notices of hearing issued by AO and NFAC CIT(A). In any case, the notices claimed to be issued by NFAC did not provide sufficient opportunity. ITA No. 1629/Ahd/2024 Govindbhai Atmaram Thakor vs. ITO Asst.Year–2017-18 - 2 - 2.1 The ld. CIT(A), has grievously erred in law and or on facts in upholding the addition of Rs. 18,01,075/- made by A.O. towards cash deposits/credit in bank accounts as unexplained income. 3.2 That in the facts and circumstances of the case ld. CIT(A), Delhi in upholding the addition of Rs. 18l01,075/- made by A.O. towards cash deposits/credit in bank accounts as unexplained income.” 3. The assessee is an agriculturist and employer of Modern Denim Ltd., since 25.10.1991. The Assessing Officer observed that the assessee deposited substantial cash in the bank accounts during the demonetization period amounting to Rs. 10,00,500/-. Notice under Section 142(1) of the assessment on 09.03.2018 as the assessee has not filed any return of income either under Section 139 or in response to notice under Section 142(1) of the Act. The Assessing Officer proceeded on the basis of Section 144(1)(b) and made addition of Rs. 18,01,075/- under Section 69A as unexplained money and addition of Rs. 84,441/- as income from other sources. 4. Being aggrieved by the assessment order the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee. 5. The Ld. A.R. submitted that there is a delay of 340 days in filing the present appeal as the assessee was not able to collect the notices and it was a genuine mistake on part of the assessee that the notices were not responded. The Ld. A.R. prayed that the delay may be condoned, besides this the Ld. A.R. submitted that both the Assessing Officer as well as CIT(A) has passed ex-parte order and therefore, the matter may be remanded back to the file of AO for proper adjudication of the issues. 6. The Ld. D.R. relied upon the assessment order and the order of the CIT(A). ITA No. 1629/Ahd/2024 Govindbhai Atmaram Thakor vs. ITO Asst.Year–2017-18 - 3 - 7. Heard both the parties and perused all the relevant materials available on record. The reason given for delay appears to be genuine hence, the delay is condoned. Besides this the Assessing Officer as well as the CIT(A) has passed ex-parte order and has not given the details as to whether the notices were served to the assessee or not. Hence, the matter is remanded back to the file of the Assessing Officer for proper adjudication of the issues after verifying the evidences submitted by the assessee. The assessee be given opportunity of hearing by following principles of natural justice. 8. In the result, the appeal of the assessee is partly allowed for statistical purposes. This Order pronounced in Open Court on 01/01/2025 Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Ahmedabad; Dated 01/01/2025 TANMAY, Sr. PS TRUE COPY आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad "