HARISH AGRAWAL,AKOLA V. ITO WARD - 1, AKOLA, AKOLA

ITA 353/NAG/2024

AI Insights

The case involves Harish Agrawal, a small businessman engaged in trading books, who did not file his income tax return for the assessment year 2017-2018. His case was selected for scrutiny and subsequently reopened under section 147 of the Income Tax Act. Due to non-response to notices, an ex-parte assessment was made, adding income from business and unexplained cash deposits to his income. Aggrieved by the assessment, Agrawal appealed to the CIT(A), which also resulted in an ex-parte order confirming the assessment. The Tribunal, considering Agrawal's health and social status, provided him another opportunity to present his case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 471265 (ITAT-NAGPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHAY Y. MARATHE
• Assessee Lawyers: MAHAVIR ATAL
• Keywords: Set aside; Opportunity of being heard; Competent authority

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR “SMC” BENCH : NAGPUR BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER ITA.No.353/NAG./2024 Assessment Year 2017-2018 Harish Agrawal, Chu Chu Bazar, Old Alasi Plot, Near Head Post Office, AKOLA – 444 001. PAN ABEPA3843Q Maharashtra. vs. The Income Tax Officer, Ward-1, Aayakar Bhawan, Gorakshan Road, AKOLA. PIN – 444001. Maharashtra. (Appellant) (Respondent) For Assessee : Shri Mahavir Atal, C.A. For Revenue : Shri Abhay Y. Marathe, Sr. DR Date of Hearing : 27.01.2025 Date of Pronouncement : 29.01.2025 ORDER PER V. DURGA RAO, J.M. : This appeal has been filed by the assessee against the order dated 31.03.2024, of the learned Addl./JCIT(A)-1, Jaipur, relating to assessment year 2017-2018. 2. Briefly stated facts of the case are that the assessee is an individual and engaged in the business of trading in old and new books at Chu Chu Bazar, Akola. The assessee had not filed return of income for the impugned assessment year 2017-2018. The case of 2 ITA.No.353/NAG./2024 the assessee has been selected for scrutiny and was reopened u/sec.147 of the Act after obtaining necessary approval from the Competent Authority. Accordingly notice u/sec.148 and statutory notices u/sec.142(1) of the Act were issued and served upon the assessee through registered mail-ID. Since the assessee did not respond to the statutory notices issues, the Assessing Officer passed ex-parte assessment order u/sec.144 r.w.s.147 of the Act vide order dated 12.12.2019 by determining the total income of the assessee at Rs.8,09,280/- by making addition of Rs.5,20,280/- as income from business u/sec.44AD of the Act [@ 8% of the total turnover of Rs.65,03,506/-]; addition on account of unexplained cash deposit of Rs.2,89,000/- u/sec.69A of the Act. 3. On being aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the learned CIT(A) and the learned CIT(A) also passed ex-parte order u/sec.144 of the Act and confirmed the assessment order of the Assessing Officer as there was no response from the side of the assessee, despite providing ample opportunities. 4. Aggrieved by the order of the learned CIT(A), the assessee carried the matter in appeal before the Tribunal. 3 ITA.No.353/NAG./2024 5. During the course of hearing, Learned Counsel for the Assessee submitted that the assessee is a heart patient suffering from long time and because of his ill-ness he could not look-after his business regularly and being a small business person he has no knowledge about the intricacies of income tax procedures. He submitted that the Assessing Officer completed the assessment by treating whole cash deposits as sales from business activity of the assessee and estimated the profit @ 8% on the cash deposit of Rs.65,03,506/-. Similarly, the Assessing Officer made addition of Rs.2,89,000/- on account of cash deposit u/sec.69A of the Act. He submitted that taking into consideration of assessee’s social status of a small businessman and his ill-health, one more opportunity may please be provided to the assessee to substantiate his case before the Assessing Officer in the interest of justice. 6. The Learned DR on the other hand strongly relied on the orders of lower authorities. He submitted that despite numerous opportunities provided to the assessee, he did not choose to file reply/explanation and therefore, the authorities had no option except to ex-parte orders under challenge. He accordingly submitted that that the orders of the lower authorities be confirmed. 4 ITA.No.353/NAG./2024 7. I have heard rival submissions of both the parties, perused the orders of the authorities below and the submissions of the Learned Counsel for the Assessee. I find that in the larger interest of substantial justice, providing one more opportunity to the assessee is just and proper in the instant case taking into consideration of his social status of a small businessman, his ill-health of heart problem and lack of knowledge of intricacies of income tax procedures. I accordingly set aside the matter back to the file of Assessing Officer with a direction to provide one final opportunity to the assessee to substantiate his case and decide the matter in issue as per fact and law by providing adequate opportunity of being heard to the assessee. I hold and direct accordingly. 8. In the result, appeal of the Assessee is allowed. Order pronounced in the open Court on 29.01.2025. Sd/- (V. DURGA RAO) JUDICIAL MEMBER Nagpur, Dated 29th January, 2025 VBP/- 5 ITA.No.353/NAG./2024 Copy to 1. The appellant 2. The respondent 3. The CIT(A), Nagpur concerned 4. The CIT, Nagpur concerned 5. The D.R. ITAT, Nagpur SMC-Bench, Nagpur 6. Guard File. //By Order// True Copy Sr. Private Secretary : ITAT : Nagpur Bench NAGPUR. "