Sh. Gajjan Singh, Chandigarh V. ITO, Ward -1, Jagraon

ITA 163/CHANDI/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9967 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Next Hearing Date: 14-11-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 22-03-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 147; 2(14)

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ , च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH ‘SMC’ CHANDIGARH BEFORE: SHRI A.D.JAIN, VICE PRESIDENT आयकर अपील सं./ ITA No. 163/CHD/2023 नधा रण वष / Assessment Year : 2011-12 Shri Gajjan Singh, #16263, Linden Court, Northville, MI, 48168, USA C/o Shri Harry Rikhy, Advocate, House No. 1573, Sector 18D, Chandigarh. बनाम VS The ITO, Ward 1, Jagraon. थायी लेखा सं./PAN /TAN No: CWMPS7279H अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से/Assessee by : Shri Harry Rikhy, Advocate राज व क ओर से/ Revenue by : Smt. Amanpreet Kaur, Sr.DR तार"ख/Date of Hearing : 15.11.2023 उदघोषणा क तार"ख/Date of Pronouncement : 16.11.2023 आदेश/ORDER PER A.D.JAIN, VICE PRESIDENT This is assessee's appeal for assessment year 2011-12 against the order dated 09.08.2019 passed by the ld. CIT(A)-3, Ludhiana. 2. The assessee has raised the following grounds of appeal : 1. That the order of the Learned Commissioner of Income Tax (Appeals)-3, Ludhiana is defective both in law and facts of the case. 2. That the re-opening of assessment by the Ld. AO u/s 147 r.w.s. 148 of the I.T. Act, 1961 is bad in law and deserves to be quashed as there was no service of the initial notice u/s 148 of the I.T. Act, 1961 on the appellant. ITA 163/CHD/2023 A.Y.2011-12 Page 2 of 6 3. That the re-opening of the assessment u/s 147 r.w.s. 148 of the I.T. Act, 1961 is bad in law and deserves to be quashed as the initial notice has not been issued by the jurisdictional officer since the appellant is a Non Resident Indian (NRI). 4. That no reasonable and proper opportunity has been granted to the appellant to represent his case as the appellant has never received any notices or communication regarding the assessment and appellant proceedings. The Ld. AO and Ld CIT(A), without making any efforts, have sent the notices to the wrong address as the appellant is a NRI residing in USA. 5. That the Learned Commissioner of Income Tax (Appeals)-3, Ludhiana is unjustified in upholding the addition of Rs.30,52,138/- made by the Ld. Assessing Officer on account of unexplained cash deposit in bank account as the source of cash deposit is from the sale proceeds of agricultural land which is beyond the municipal limits and is not a capital asset u/s 2(14) of I.T. Act, 1961 and is not taxable. This addition is uncalled for & deserves to be deleted.” 3. There is a delay of 3 years and 5 months in filing the appeal. In the application for condonation of delay, supported by an affidavit of the assessee, it has been contended as follows : 1) That the appellant is a Senior Citizen having PAN No. CWMPS7279H. 2) That the appellant is a Non Resident Indian (NRI) residing in USA since 1986 and his present address is #16263 Linden Court, Northville, MI 48168, USA. 3) That the appellant had no knowledge of the re-assessment proceedings being initiated by the Ld. Income Tax Officer, (OSD)-2, Jagraon u/s 147 r.w.s. 148 of the I.T. Act, 1961 as he never received any notice or any correspondence. 4) That the Ld. Income Tax Officer passed an Ex-parte assessment order u/s 144 r.w.s. 147/14"8 of the I.T. Act, 1961 on 19-12-2018 in which an addition of Rs.30,52,138/- was made with tax demand of Rs.22,19,591/- which came to the appellant's knowledge much later through a relative residing at Jagraon, Punjab. 5) That from the perusal of the above said assessment order dated 19-12- 2018 it is observed that the Ld. Income Tax Officer while framing the assessment had used the wrong address of Village Parjian Beharipu, Tehsil Jagraon, Ludhiana, Punjab which does not belong to the appellant as he is a NPJ residing in USA since 1986. 6) That as soon as it came to appellant's knowledge he contacted his friend Late Sh. T.S. Gill, who was also a NRI and residing at USA, for help in the Income Tax case as his friend was planning to visit India in near future. 7) That Sh. T.S. Gill on his visit to India met and engaged his known counsel Mr. Harry Rikhy, Advocate at Chandigarh on 10-03-2019 to ITA 163/CHD/2023 A.Y.2011-12 Page 3 of 6 file an appeal against the above said Ex-parte assessment order which was filed online in Form No. 35 on 14-03-2019 along with the request for condonation of delay. 8) That the Form No. 35 included appellant's complete residential address i.e. House No. 51257, Upland View, Canton, USA - 481880, at which he was staying during the period 2010 - 2019, along with the mobile no. of counsel 981501.6000 and e-mail of friend i.e. [e-mail] . However, we did not receive any notice or information of hearing till date as done in the past during assessment proceedings. 9) That recently appellant's counsel Sh. Harry Rikhy, Advocate contacted his son on 13-02-2023 through an e-mail along with the demand notice of Rs. 22,19,590/- dated 25-01-2023 and informed the appellant about the dismissal of the appeal case vide Ex-Parte order. 10) That the appellate order has been decided Ex-parte on 09-08-2019 by the Ld. Commissioner of Income Tax (Appeals)-3, Ludhiana and uploaded online on 09-09-2019 which was also not in appellant's knowledge and our counsel got to know about the said order after receiving a message on his mobile of the demand notice dated 25-01- 2023 from the Ld. ITO, Ward 1, Jagraon. 11) That from the perusal of the above said appellate order dated 09-08- 2019 it is observed that the Ld. Commissioner of Income Tax (Appeals)- 3, Ludhiana has again used the same wrong address of Village Parjian Beharipu, Tehsil Jagraon, Ludhiana, Punjab, which does not belong to the appellant who is a NRI residing in USA since 1986, despite the fact that the counsel had given the correct address and contact details in Form No. 35. 12) That as soon as it came to appellant's knowledge we immediately initiated the process of filing further appeal before the Hon'ble ITAT, Chandigarh on the professional advice of the Counsel Sh. Harry Rikhy as the tax demand is unjustified and deserves to be deleted. 13) That even the profile of the appellant in the Income Tax Portal shows the address i.e. House No. 51257, Upland View, Canton, USA - 481880, at which he was staying during the period 2010-2019, along with the mobile no. of the counsel 9815016000, e-mail of the counsel i.e. [e-mail] and friend i.e. [e-mail]. The Ld. CIT(A)-3, Ludhiana has even ignored the profile details duly available on the Income Tax Portal. 14) That the appellant is a bona-fide person and the Ex-parte orders have been passed by the Ld. ITO, (OSD)-2, Jagraon and Ld. CIT (A)-3, Ludhiana due to miscommunication as the Department have been using the wrong address without making any efforts to serve the notices or inform the appellant regarding the case. 15) That the appellant had sold his share in Agricultural land measuring 99 kanals at Village Durgapur Garbi, Tehsil Taran Taran, Punjab on 07-05-2010 along with the other co-owners which was not a capital ITA 163/CHD/2023 A.Y.2011-12 Page 4 of 6 asset u/s 2(14) of the I.T. Act, 1961 as it was beyond the Municipal limits. 16) That the cash deposited in appellant's savings bank account with Oriental Bank of Commerce during the F.Y. 2010-11 is from the sale proceeds of the above mentioned agricultural land which is not taxable. 17) That the appellant duly has the explanation along with the supporting evidence of the cash deposited in Bank during the F.Y.2010-11 for which he is filing the further appeal before the Hon'ble ITAT, Chandigarh in order to get an opportunity to explain his case in the interest of Equity and Natural Justice as the tax demand is unjustified and deserves to be deleted. 4. In his counter affidavit, the ITO, Ward-1, Jagraon, has contended that no information was provided by the assessee at the time of applying for PAN, which was allotted to the assessee on 04.08.2010; that further, no intimation regarding change of address was given to the Department by the assessee, as required u/s 139A(5)(d) of the Income Tax Act; that all the notices were sent at the address given in the PAN by the assessee; that the order passed by the ld. CIT(A) was also sent at the address given in the PAN; that as per the details of the assessee on User Profile Administration (CPC 2.0), the last profile update was on 13.06.2023 only. Further, the CIT(A), Unit-3, Ludhiana, vide his letter dated 18.08.2023, has stated that the order dated 09.08.2019, passed by the ld. CIT(A)-3, Ludhiana, i.e., the impugned order, was sent to the assessee through Speed Post on 17.09.2019, but the same was returned back with the remarks “Address could not be found”. ITA 163/CHD/2023 A.Y.2011-12 Page 5 of 6 5. It is, thus, evident that as admitted on behalf of the Department, the certified copy of the order under appeal was never served on the assessee and it was only through the Demand Notice, that the assessee came to know of the passing of the impugned order. This being so, there is, in my considered opinion, no delay attributable to the assessee incurred in filing the present appeal. 6. Apropos the grounds raised before this Bench, the assessee's contention is that he had shifted to the United States of America way back in 1986 and he was not aware of the pendency of the assessment proceedings; that even after the institution of the appeal before the ld. CIT(A), no notice got served on the assessee and it was only on getting to know about the Demand Notice, that the passing of the impugned order came to his knowledge. 7. Both the taxing authorities, it is seen, have proceeded ex- parte qua the assessee. Since the assessee had no knowledge of the assessment proceedings, in my considered opinion, it would be appropriate to remit the matter to the file of the AO, to be decided afresh in accordance with law, on affording due and adequate opportunity of hearing to the assessee, so that the assessment is framed afresh by following the provisions of natural justice. Ordered accordingly. The assessee, no doubt, ITA 163/CHD/2023 A.Y.2011-12 Page 6 of 6 shall cooperate in the fresh proceedings before the AO. All pleas available under the law shall remain so available to the assessee. 8. In view of the above, for statistical purposes, the appeal of the assessee is treated as allowed. 9. In the result, the appeal is allowed, for statistical purposes. Order pronounced in the Open Court on 16 th November,2023. Sd/- (A.D.JAIN ) VICE PRESIDENT “Poonam” आदेश क琉 灹ितिलिप अ灡ेिषत/ Copy of the order forwarded to : 1. अपीलाथ牸/ The Appellant 2. 灹瀄यथ牸/ The Respondent 3. आयकर आयु猴/ CIT 4. िवभागीय 灹ितिनिध, आयकर अपीलीय आिधकरण, च瀃डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड榁 फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar