INAM MIYAN, KOTA V. ITO Ward 1(4) Kota, Kota

ITA 182/JPR/2022

AI Insights

The case involves an appeal by Inam Miyan against the order of the CIT(A) dated 09-03-2019 for the assessment year 2017-18. The primary issues in the appeal included the legality of the ex-parte assessment order passed under section 144, the addition of Rs.1,69,35,170 as income under section 68 due to unexplained cash deposits, and the application of a higher tax rate under section 115BBE. The assessee contended that the orders were passed without adequate opportunity of being heard and were based on assumptions rather than facts. The ITAT found merit in the assessee's request for additional evidence and the need for a fair hearing, thus restoring the case to the AO for a fresh assessment.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 132411 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 11-10-2022
• Assessment Year: misc
• Appeal Filed On: 09-12-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Opportunity of being heard; Principle of natural justice; Additional evidence; Assessment record
• Section: 68; 144; 143(2)

Judgement Text

vk;djvihyh; vf/kdj.k] t;iqjU;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,’A’ JAIPUR Mk0 ,l- lhrky{eh]U;kf;dlnL; ,oaJhjkBksMdeys'kt;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;djvihy la-@ITA No. 182/JP/2022 fu/kZkj.ko"kZ@AssessmentYear : 2017-18 InamMiyan M/s. Farman Trading Company B-14, Chatarpura, Talab Vigyan Nagar Kota (Raj) – 324 005 cuke Vs. The ITO Ward 1 (4) Kota LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: CRTPM 2930 H vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Shrawan Kumar, Advocate jktLo dh vksjls@Revenue by: Shri A.K. Mehla, Addl. CIT lquokbZ dh rkjh[k@Date of Hearing : 12/10/2022 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 21/11/2022 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This appeal by the assessee is directed against the order of the ld. CIT(A) dated 09-03-2019, National Faceless Appeal Centre, Delhi [ hereinafter referred to as (NFAC) ] for the assessment year 2017-18. The grounds of appeal raised by the assessee are as under:- ‘’1.1 The impugned assessment order u/s 144 dated 12-12- 2019 as well as notices are bad in law and on facts of the case for want of jurisdiction and various other reasons and hence the same may kindly be quashed. 2 ITA NO. 182/JP/2022 INAM MIYAN VS ITO, WARD 1(4), KOTA 1.2 The AO has grossly erred in law as well as on the facts of the case in passing the ex-parte assessment order u/s 144 without providing adequate and reasonable opportunity of being heard and not considering the material on record in the gross breach of natural justice. Hence the same entire addition may kindly be deleted and the assessment order may kindly be quashed. 2. The ld. CIT(A) has grossly erred in law as well as on the facts of the case in passing the Ex-parte order and confirming the order of the AO without providing adequate and reasonable opportunity of being heard and not considering the material on record in the breach of natural justice. Hence, the same entire addition may kindly be deleted and the assessment order may kindly be quashed. 3. Rs.1,69,35,170/-: The ld. CIT(A) has grossly erred in law as wel as on the facts of the case in confirming the addition of Rs.1,69,35,170/- made by the AO u/s 68 on account of entire cash deposit (total cash deposit of Rs.1,72,82,620/-) in the bank account which was business receipts and also erred in not considering the material and evidences available on record in their true perspective and sense and proceeded just on assumptions and presumptions. Hence, the addition so made by the AO and sustained by the ld. CIT(A) is being totally contrary to the provisions of law and facts on the record and hence the same may kindly be deleted in full. 4. The AO has grossly erred in law as well as on the facts of the case in invoking the provisions of Section 115BBE for charging tax on higher rate without any show cause notice and not applicable being the business receipts. Hence, the provisions so invoked and tax so charged at higher rate is also being totally contrary to the provisions of law and facts on the record and hence the same may kindly be deleted in full. 5. The AO has grossly erred in law as well as on the facts of the in charging interest u/s 234A, B and C. The appellant totally denies its liability of charging of any such interest. The interest so charged being contrary to the provisions of law and facts, may kindly be deleted in full. 3 ITA NO. 182/JP/2022 INAM MIYAN VS ITO, WARD 1(4), KOTA 2.1 Further, during the course of hearing, the ld. AR of the assessee vide application dated 11-10-2022 prayed for admitting additional evidence under rule 29A of the ITAT, Rules, 1963. The relevant relied upon part of the application is reiterated here in below: ‘’’Now we are filing a paper books. In the paper book pages at Serial No. 3 to 6 are additional evidence. Further these are only for reference and to explain the Bench about the source of cash deposits. Hence, due to this reason these documents are required to file before the Bench and these papers have direct impact on the assessment and it goes very root of the matter. The list of paper book Index is as under:- S.N. Particulars Page No. 1. Copy of IT Return 1-10 2. Copy of Balance Sheet and P&L account 11-12 3. Copy of cash receipts details 13-15 4. Copy of some specimen copies of bills 16-21 5. Copy of Bank Statement 22-52 2.2 During the course of hearing, the ld. DR objected to the additional evidence filed by the ld. AR and simultaneously relied upon the orders of the authorities below and submitted that the assessee remained non complied to the various opportunities granted and therefore, he objected to the petition made by the assessee for additional evidence. 2.3 We have heard both the parties and perused the materials available on record. Brief facts of the case are that the case of the assessee was selected for scrutiny assessment under CASS. The Notice u/s 143(2) of the Act was issued on 4 ITA NO. 182/JP/2022 INAM MIYAN VS ITO, WARD 1(4), KOTA 11-09-2018 requiring the assessee to furnish evidence / information specified in the notice. The Assessee did not furnish any reply. Therefore, the provisions of Section 144 of the Act initiated by the AO. During the course of assessment proceedings, the AO as per information as well as assessment record observed that the assessee had deposited total cash of Rs.1,72,82,620/- in ICICI Bank, Jhalawar Road, Kota. Statutory notices were issued for verification of cash deposits but the assessee neither complied with the notices nor submitted any information and documentary evidences to prove that the cash deposited by the assessee was earned by him and the same amount was deposited in the bank. In absence of verification of source of income and source of cash deposits, the amount of Rs.1,72,82,620/- deposited by the assessee in ICICI Bank, Jhalawar Road, Kota was treated as income of the assessee u/s 68 of the Act which in first appeal was confirmed by the ld. CIT(A), NFAC, Delhi. From the records, it is noted that the assessee could not contest the case before the AO for the reason that the AO passed the ex-parte order and the assessee was not provided adequate opportunity of being heard and similar modus operandi took place in first appeal before the ld. CIT(A), NFAC, Delhi who confirmed the order of the AO. However, the ld. AR of the assessee has prayed for admitting the additional ground under rule 29A of ITAT Rules, 1963 to contest the case with proper documents evidences on merits and in the interest of justice. The Bench does not go into the merit of the case as to what happened in the case before 5 ITA NO. 182/JP/2022 INAM MIYAN VS ITO, WARD 1(4), KOTA the lower authorities but Bench feels that the assessee should be provided adequate opportunity of being heard by the lower authority for which Bench has no objection to admit the additional evidence filed by the assessee and thus it is directed to the AO to consider the additional evidences so filed by the assessee and decide the case on merit by providing adequate opportunity of being heard to the assessee and the decide the issue on merits of the case. Thus the appeal of the assessee is restored to the file of the AO for afresh adjudication in view of the additional evidence so filed by the assessee. Hence, the appeal of the assessee is allowed for statistical purposes. 3. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 21 /11/2022. Sd/- Sd/- ¼Mk0 ,l- lhrky{eh ½ ¼jkBksMdeys'kt;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;dlnL;@Judicial Member ys[kklnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 21/11/2022 *Mishra vkns'k dh izfrfyfivxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Shri Inam Miyan, Kota 2. izR;FkhZ@ The Respondent- The ITO, Ward 1(4), Kota 3. vk;djvk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;djvihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZQkbZy@ Guard File (ITA No. 182/JP/2022) vkns'kkuqlkj@ By order, lgk;diathdkj@Asst. Registrar