Balwinder Singh, Gurdaspur V. ITO WARD , GURDASPUR

ITA 194/ASR/2024

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 2190 (ITAT-AMRITSAR)
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 13-05-2024
• Assessment Year: 2015-2016
• Appeal Filed On: 08-04-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 148; 142(1); 250; 207; 208

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. UDAYAN DASGUPTA, JUDICIAL MEMBER I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 Balwinder Singh, Guru Nanak Nagri Dinanagar, Punjab. [PAN:-DZIPS3972R] (Appellant) Vs. ITO, Ward Gurdaspur. (Respondent) Appellant by Sh. Rohit Kapoor, CA and Sh. V.S. Aggarwal, ITP Respondent by Sh. Radhey Shyam Jaiswal, Sr. DR Date of Hearing 14.05.2024 Date of Pronouncement 28.05.2024 ORDER Per: Udayan Dasgupta, JM: The instant appeal of the assessee was filed against the order of the ld. Commissioner of Income Tax (Appeals), NFAC, Delhi, [in brevity the ‘CIT (A)’], order passed u/s 250 of the Income Tax Act 1961 (in brevity the Act) dated I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 2 09.02.2024 for A.Y. 2015-16. In turn arising out of order dated 13/03/2023 passed u/s 147 rws 144 / 144B of the Act 61. The CIT (A) has refused to admit the appeal for hearing, for nonpayment of advance tax as per provisions of section 249(4)(b) of the Act 61. 2. The grounds of appeal filed by the assessee before us are as follows: “1. On the facts and circumstances of the case, the Ld. CIT(A) vide order u/s 250(6) dated 09.02.2024 rejecting the appeal filed vide form 35 for non-payment of tax payable on addition of Rs. 8942000/- made by the Ld. AO vide order u/s 147 r.w.s 144. 2. That the Ld. CIT(A) has erred in rejecting the appeal filed vide form 35 by invoking the provisions of section 249(4) without appreciating that the stipulation as to the payment of tax before filing of first appeal is only directory and not mandatory. 3. That the Ld. CIT(A) has erred in rejecting the appeal filed vide form 35 against the order passed by the AO u/s 147 r.w.s 144 in view of the fact that the assessee could not remit the tax payable due to financial hardship and there is no evidence of any dishonest or improper motive on the part of the assessee. I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 3 4. That the Ld. CIT(A) has erred in rejecting the appeal filed vide form 35 in limine without adjudicating the case on merits. 5. That the CIT(A) has erred in confirming the addition of Rs. 8942000/- made by the AO on account of total deposits including cash deposits with respect to sale of land and advance received. 6. That the CIT(A) has erred in confirming the addition made by the AO without appreciating that deposit of Rs. 8342000/- was made out of sale proceeds of sale of agriculture land and deposit of Rs. 60000/- was made out of advance received in respect of agriculture land which are exempt as per the provisions of Income Tax Act, 1961. 7. That the CIT(A) has erred in confirming the addition of Rs. 8942000/- on account of cash deposited without considering the documents furnished by the assessee. 8. That CIT(A) has erred in rejecting the appeal in limine by resorting to section 249(4) without appreciating that meaning of tax as embedded in section 249(4) means tax on real income. 9. That the appellant craves leave to add or amend the grounds of appeal before the appeal is heard and disposed off.” I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 4 3. Facts of the case in brief are that , the assessee during the year under appeal derived income from agriculture , and has derived substantial amount on sale of agricultural lands and also against advance for sale. No return has been filed in normal course. Cash has been deposited in bank by the assessee, amounting to Rs. 95,30,500/-, during the year under appeal. In absence of any return on record, notice u/s 148 of the Act 61, issued on 31/03/2022, (as per provisions of law laid down under new regime). Subsequent notices u/s 142(1) of the Act 61, also issued. However, the assessee filed written submission before the AO on 20/02/2023 along with documentary evidence of registered deed of sale of agricultural lands, agreement of advance against sale of land, bank statements, computation of income, etc. as explanation to cash deposit in bank accounts. 3.1 However, the AO completed the assessment on a total income of Rs. 89,42,000/-, against which the appeal was filed before the first appellate authority, challenging various grounds as contained in Form 35. 3.2 The issue before the CIT ( A ) , for non admission of the appeal , was that the memorandum of appeal ( filed in Form 35 , the clause no 8 and 9 ) ,of the said form , was incorrectly filed, because in the instant case , the assessee , has neither I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 5 paid any advance tax as per provisions of Chapter XVII of the Act 61 , nor has he filed any return of income for the year under appeal , and as such the admission of the appeal is hit by the provisions of section 249(4)(b) of the Act 61 . 3.3 In response to the deficiency letter issued by the CIT(A) dated 10/01/2024, the appellant filed a short reply, which is reproduced as under: “2.6 In response to the deficiency notice, the appellant has furnished reply dated 15.01.2024 stating as below: Respected AO, its respectfully submitted that your good self has demanded clarification in respect to appeal number NFAC/2014-15/10235571 dated 10/01/2024. in s context it is submitted that no Income Tax Return has been filed under any section so, acknowledgement number, date of filing and tax paid information cannot be provided as my source of income was from agriculture only. Secondly, in Form 35, column number 8, it is mentioned that no Income Tax Return has been filed, so no question arises of tax deposit. Column number 9 is of taxed posited, it is submitted there is no tax liability as no Income Tax return has been filed. It is humbly prayed that Form 35 is filed completely. Kindly treat the appeal as valid and oblige". I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 6 3.4 The CIT(A) concluded that the reply filed by the assessee is not satisfactory , and it is also stated , that the assessee has not made any application as per proviso to section 249(4)(b) of the Act 61, along with the memorandum of appeal in Form 35 , praying for exemption from operation of the said provision of that clause. As such, the CIT(A), dismissed the appeal for statistical purpose as not admitted. 4. In course of hearing of the appeal the Ld. AR, argued that in the instant case, the assessee is an agriculturist , has agricultural income and has also received sale proceeds on sale of agricultural lands against registered sale deeds , during the year amounting to Rs.83.42 lakhs plus Rs.6 lakhs on agreement of sale , and the documentary evidence of which has already been submitted before the AO in course of assessment proceeding as narrated by the AO in the assessment order and verifiable from on line portal response sheet . All the receipts together have formed the source of bank deposits. 5. The AR, also filed a copy of the computation of taxable income for the year ended 31/03/2015, ( which is already in AO record ) disclosing taxable income at NIL. He further argued that this being the case, the assessee never had any taxable income during the year and had no liability to pay advance tax , as per provisions I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 7 of section 210 of the Act 61, ( which is expected to be paid by the assessee of his own accord ) , and as per computation of advance tax u/s 209 ,the advance tax payable is NIL . 5.1 In other words , as per the assessee own computation , the advance tax payable is NIL as per provisions of section 249(4)(b) of the Act 61, and correspondingly , his admitted tax liability, for the purpose of Form 35 is also NIL, and that is the reason , why the assessee has stated “ NOT APPLICABLE ” against column - 8 and column - 9 of Form 35. 5.2 He further argued that, the proviso to section 249(4)(b) of the Act 61, applies in a case where advance tax ( or admitted tax ) liability exists as per section 210 , by the appellants own calculation u/s 209 , and the appellant is prevented by some reasons from making payment thereof , then in such cases the appellant is allowed a window to make an application of waiver quoting good and sufficient reasons before the first appellate authority , to exempt him from the operation of the provision of that clause. 5.3 In other words, in the instant case since the amount of advance tax payable by the assessee was NIL as per clause (b) of sub sec (4) of Sec 249, the proviso to the said clause (b) itself is not triggered in this case. I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 8 5.4 The AR in support of his arguments relied upon the decision of the ITAT , Raipur Bench in ITA No: 73/ RPR/ 2024, in the case of Vishnusharan Chandravanshi vs ITO , 161 taxman.com 803 ( Raipur ), and prayed that the appeal before the first appellate authority is legally valid and should not be rejected for non payment of advance tax because in the instant case no advance tax is actually payable because the assessee has no taxable income and the appeal should be admitted to be decided on merits. 6. The Ld DR, relied on the order of the CIT (A) and argued that the appeal before the CIT (A) is not maintainable, for non-payment of advance tax and is hit by the provisions of section 249(4) (b) of the Act 61. 7. We have heard the submissions of the rival counsels, and considered the materials on record. The documentary evidences filed by the assessee, of course, has been filed before the AO in course of assessment proceedings (as seen from the computer printout of the on line response sheet needs filed before us ) , but we are not expressing any opinion on the same because we are not adjudicating on the merits of the case and our opinion are only restricted to the applicability of section 249(4)(b) of the Act 61. 7.1 We find that the assessee has declared , before the AO that he has no taxable income for the year under appeal and his income is only agricultural income, and I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 9 receipts from sale proceeds sale of agricultural land which is exempted income under the Act 61 and the computation filed , shows non-taxable Income , and has filed documentary evidence of the same before the AO , as evident from the assessment order, and in the computation of income filed by the assessee before the Tribunal , he has declared NIL taxable income , thereby indicating that he is not liable to pay any advance tax as per provisions of section 207 of the Act 61 because he has no total income which would be chargeable to tax and computation of advance tax , as per sec 209 of the Act is NIL, and according to the assessee the payment of advance tax u/s 210 of the Act , of his own accord , does not arise in this case. We also note that the assessee has filed a reply before the first appellate authority to the deficiency letter, dated 15/01/2024, stating that he has no taxable income and not liable to file return of income. 7.2 As such, considering all materials on record, we are of the opinion, that the assessee has presented a prima facie case, of no obligation, to make payment of advance tax u/s 208 of the Act 61, for the year under appeal, and we hold that the CIT(A) should have admitted the appeal for adjudication on merits, and the amount of advance tax payable by the assessee, for the purpose of presenting the appeal, as per provisions of section 249(4)(b), should be taken as NIL. I.T.A. No.194/Asr/2024 Assessment Year: 2015-16 10 Accordingly, we set aside the order of the CIT(A) and restore the same to his file, for adjudication on merits, on the grounds contained in Form 35, after causing all necessary verification of all documentary evidences as he deems fit and proper, as per procedure of law, (un influenced by any observation we might have made in the above paragraphs), and after allowing proper opportunity to the assessee of being heard. 8. In the result, the appeal of the assessee bearing ITA No. 194/Asr/2024 is allowed for statistical purposes. Order pronounced in the open court on 28.05.2024 Sd/- Sd/- (Dr. M. L. Meena) (UDAYAN DASGUPTA) Accountant Member Judicial Member AKV Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order