Amir Jamaludeen Mirza, Vapi V. Income Tax Officer, Silvassa Ward, Silvassa

ITA 113/SRT/2023

AI Insights

The case involves Amir Jamaludeen Mirza, the appellant, who contested the addition of Rs. 22,65,700 to his income, which was deemed unexplained money under Section 69A of the Income Tax Act, 1961. The addition was based on cash deposits in the appellant's bank account, which the Assessing Officer and the CIT(A) considered unexplained. The appellant argued that these were business receipts from his wood scrap business and that he had filed his income tax returns under section 44AD, which did not require maintaining detailed books of account. The CIT(A) dismissed the appeal on the grounds of limitation and lack of evidence, leading to the appellant's appeal to the Income Tax Appellate Tribunal. The Tribunal found procedural lapses in the handling of the case by the lower authorities and remanded the case back to the Assessing Officer for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 301508 (ITAT-SURAT)
• Duration Of Justice: 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-07-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 13-02-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Peak credit; Period of limitation
• Section: 144; 44AD; 69A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH (SMC), SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No. 113/Srt/2023 (Assessment Year 2013-14) (Physical hearing) Amir Jamaludeen Mirza, Flat No. 302, Building D-2, Vapi silvassa Road, Dream City, Vapi-396195 (Gujarat) PAN No. AVPPM 7767 C Vs. I.T.O., Ward-Silvassa, Silvassa. Appellant/ assessee Respondent/ revenue Assessee represented by Suresh K. Kabra, CA Department represented by Shri Vinod Kumar, Sr. DR Date of Institution of Appeal 14/02/2023 Date of hearing 27/07/2023 Date of pronouncement 27/07/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of learned National Faceless Appeal Centre (NFAC), Delhi/Commissioner of Income Tax (Appeals) (in short, the ld. CIT(A)) dated 19/12/2022 for the Assessment Year (AY) 2013-14. The assessee has raised following grounds of appeal: “1. Because the learned CIT(A) has erred in confirming the addition of Rs. 22,75,700/- made on the basis of cash deposited in bank, on the basis of AIT information. The learned CIT(A) has not applied peak theory, as there is deposit and withdrawal of cash from bank. Therefore, it is prayed that the addition so made may kindly be reworked on peak theory. 2. Because the learned Respondent failed to appreciate the fact that the Appellant was engaged in the business of wood scrap and the said source for the deposits in the bank account were business receipts and therefore the same was not liable to be added as unexplained deposits. Further, the appellant was carrying a very small business and he has declared the ITA No. 113/Srt/2023 Amir Jamaludeen Mirza Vs ITO 2 income undersection 44AD of the Act, therefore, there is no necessity of maintaining the books of account. 3. Because the learned respondent has failed to consider that the Appellant has filed his ITR on 07/08/2019 and the assessing officer has erred in making addition of Rs. 22,65,700/- derived from the total credits made in the current account of the appellant as unexplained money in terms of Section 69A of the Act. That the cash amount of Rs. 22,65,700/- deposited by the appellant in his account was collected from their customer and the same amount was withdrawn by the Appellant. 4. Because the appellant’s consultant has not taken proper measure for filing the appeal before the CIT(A) and also not appeared before the CIT(A) which is a professional lapse and cannot be attributed to the appellant.” 2. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that the appeal of assessee was dismissed by the ld. CIT(A) in an ex parte order without giving fair and reasonable opportunity of hearing to the assessee. The ld. CIT(A)/NFAC has not passed the order on merit as mandated under Section 250(6) of the Income Tax Act, 1961. The ld. AR of the assessee submits that the Assessing Officer has also passed the assessment order without giving adequate opportunity to the assessee. 3. The ld AR for the assessee submits that the ld CIT(A) also held that there is delay of 164 days in filing appeal before him and of the assessee was also dismissed on the limitation point. The ld AR for the assessee submits that there was no delay in filing appeal before ld CIT(A) from the date of receipt of assessment order and demand notice received by him personally only on 18/02/2020 and appeal was filed on 07/03/2020. The ld CIIT(A) dismissed the appeal without ITA No. 113/Srt/2023 Amir Jamaludeen Mirza Vs ITO 3 verification of real facts. The assessee has filed his affidavit to support such facts before this Hon’ble Tribunal. The ld AR prayed to pass an order in setting aside such finding of ld CIT(A). 4. The ld. AR of the assessee submits that the assessee has good case on merit and likely to succeed if he has given one more opportunity to contest the case on merit. The ld. AR of the assessee submits that the ld. CIT(A) confirmed the action of Assessing officer by taking a view that the assessee has failed to furnish any evidence in support of his contention and in absence of any evidence whatsoever whether documentary or otherwise. The ld. CIT(A) passed the order without considering the merit of the case. 5. On the other hand, the learned Senior Departmental Representative (Sr. DR) for the revenue supported the orders of the lower authorities. The ld. Sr. DR for the revenue submits that the assessee is non- cooperative during assessment proceedings as well as appellate proceedings. 6. I have heard the submissions of both the parties and record perused. I find that the Assessing Officer passed the assessment order under Section 144 r.w.s. 147 of the Income Tax Act, 1961 (in short, the Act) by making addition of Rs. 22,65,700/- on account of unexplained money under Section 69A of the Act. The Assessing Officer made addition by holding that the assessee failed to furnish necessary details about the cash credit in bank account of assessee of Rs. ITA No. 113/Srt/2023 Amir Jamaludeen Mirza Vs ITO 4 22,65,700/-. The ld. CIT(A) also confirmed the addition for want of submission and necessary evidences and the appeal of assessee was also held to be filed after period of limitation. 7. I find that before ld CIT(A) the assessee submits that there was no delay in filing appeal before ld CIT(A) from the date of receipt of assessment order and demand notice received by him personally only on 18/02/2020 and appeal was filed on 07/03/2020. I further find that the ld CIIT(A) dismissed the appeal without verification of real fact from the assessing officer whether the contention of assessee is correct or not. Thus, I hold that the appeal of the assessee before ld CIT(A) was filed well in time from the date of receipt of the assessment order. 8. On merit, I find that Assessing Officer has passed the assessment order was also passed under section 144. The ld CIT(A) also dismissed the appeal in ex-party, without discussing the merit of the case. The order of ld CIT(A) is also not in accordance with the mandate of section 250(6). Thus, in my view the assessee require one more opportunity to explain and substantiate his claim, therefore, I think it appropriate to restore the grounds of appeal back to the file of Assessing Officer to consider the case afresh by giving adequate opportunity of hearing to the assessee. The assessee is also directed to be more vigilant in future and not to cause further delay and seek adjournment without any valid reason and to furnish all the details ITA No. 113/Srt/2023 Amir Jamaludeen Mirza Vs ITO 5 and his submissions and evidences on various grounds of appeal raised by him, as soon as possible, if so desired without any further delay. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes. 9. In the result, the appeal of assessee is allowed for statistical purposes only. Order announced in open court on 27 th July, 2023 at the time of hearing. Sd/- (PAWAN SINGH) JUDICIAL MEMBER Surat, Dated: 27/07/2023 *Ranjan Copy to: 1. Assessee – 2. Revenue – 3. CIT 4. DR 5. Guard File By order Sr. Private Secretary, ITAT, Surat