KISHORBHAI CHHAGANBHAI ANDIPARA, RAJKOT V. ITO, WARD-1(2)(1), RAJKOT

ITA 199/RJT/2022

AI Insights

The case involves Shri Kishorbhai Chhaganbhai Andipara, the appellant, who contested an ex parte assessment order passed under sections 144 and 147 of the Income Tax Act, 1961, by the Income Tax Officer, Rajkot. The assessment was based on unexplained cash deposits totaling Rs. 19,90,500 in the appellant's bank account for the Assessment Year 2011-12. The appellant did not file a return of income as his income was below the exemption limit. The Assessing Officer initiated reassessment proceedings after discovering the deposits and issued a notice under section 148, which the appellant failed to respond to. The NFAC dismissed the appeal due to non-response from the appellant. The Tribunal noted discrepancies in the NFAC's order regarding the amount and bank mentioned, leading to the decision to remand the case for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 138219 (ITAT-RAJKOT)
• Duration Of Justice: 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 22-02-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 18-07-2022
• Other Referred Cases: Sudhir Kumar Sharma (HUF) Vs. CIT, K Chinnathambam vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Invalid notice; Onus to prove; Reassessment proceedings; Set aside
• Section: 144; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (Conducted Through Virtual Court) Before: Shri Waseem Ahmed, Accountant Member And Shri T.R. Senthil Kumar, Judicial Member Shri Kishorbhai Chhaganbhai Andipara Parishram, Shantinagar Gundala Road, Gondal- 360311 PAN No: AJLPA8514H (Appellant) Vs The Income-tax Officer, Ward-1(2)(1), Rajkot (Respondent) Assessee Represented: Shri Mehul Ranpura, A.R. Revenue Represented: Shri B.D. Gupta, Sr.D.R. Date of hearing : 23-02-2023 Date of pronouncement : 24-02-2023 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- This appeal is filed by the Assessee as against the ex parte order dated 17.05.2022 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “NFAC”), arising out the Assessment order passed under section 144 r.w.s. 147 of the Income Tax Act, 1961 (hereinafter ITA No. 199/Rjt/2022 Assessment Year: 2011-12 I.T.A No. 199/Rjt/2022 A.Y. 2011-12 Page No Shri Kishorbhai Chhaganbhai Andipara vs. ITO 2 referred to as ‘the Act’) relating to the Assessment Year (A.Y) 2011- 12. 2. The brief facts of the case is that the assessee is an individual and assessed to tax before the Income Tax Officer, Rajkot. As the net taxable income for the assessment year 2011-12 was below the basic exemption limit, the assessee has not filed the Return of Income u/s. 139 of the Act. 2.1. The Assessing Officer found that the assessee had deposited cash of Rs. 19,90,500/- in assessee Saving Bank Account with Rajkot Nagrik Sahakari Bank Ltd. However no Return of Income was filed by the assessee. Therefore the Assessing Officer initiated reassessment proceedings u/s. 147 of the Act by issuing a notice u/s. 148 of the Act dated 21.03.2018. The assessee has not responded to the above notice, in spite of opportunities given to the assessee. Therefore the Assessing Officer passed an ex parte assessment order u/s. 144 r.w.s. 147 of the Act determining the total income of the assessee at Rs. 21,50,500/-, which includes the cash deposit of Rs. 19,90,500/- and estimation of house hold withdrawal of Rs. 1,60,000/-. 3. Aggrieved against the same, the assessee filed an appeal before Ld. NFAC. The Ld. NFAC taken up the case for hearing, as the assessee has not responded to the earlier hearing notices, therefore the Ld. NFAC dismissed the appeal observing as follows: I.T.A No. 199/Rjt/2022 A.Y. 2011-12 Page No Shri Kishorbhai Chhaganbhai Andipara vs. ITO 3 “...Ground Nos. 4 & 5: The only ground is related to addition on account of cash of Rs 26,90,000/- deposited in Indian Corporation Bank, during the F.Y. 2010 11. The appellant has not explained the source of cash deposited either during the assessment proceedings or during the appellate proceedings before me. During the appellate proceedings, the appellant has not responded to the notices issued by me. The burden of proof primarily lies on the appellant to explain the nature and source of cash deposited during the F.Y. 10-11. Reliance is placed on the decision in the case of Sudhir Kumar Sharma (HUF) Vs. CIT (2014) 46 Taxmann.com 340 (P&H), the Supreme Court dismissed the Special Leave Petition filed against the impugned order wherein, it is held that since, cash was deposited in bank account of the assessee, onus was upon the assessee to explain nature and source of said cash deposit. Reliance is also placed on the decision of Supreme Court in the case of K Chinnathambam (2007) 162 taxmann.com 459 (SC)/(2007) 292 ITR 682 (SC)/(2007) 211 CTR 86 (SC) wherein, it is held that the onus of proving the source of deposit primarily rest on the person in whose name the deposit appears in various banks. As the appellant did not discharge the burden of proof, the A.O. is right in his action to treat the said cash deposit as unexplained. The Ground of appeal is dismissed.” 4. Aggrieved against the same, the assessee is in appeal before us raising the following Grounds of Appeal: 1. The grounds of appeal mentioned hereunder are without prejudice to one another. 2. The ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to as the "CIT(A)"] was erred on facts as also in law in dismissing the appeal ex-parte. 3. The ld. CIT(A) in rejecting the ground of appeal related to validity of notice issued u/s. 148 of the Income tax Act, 1961. That on facts as also in law, Initiation of proceedings u/s. 147 of the Act is invalid and assessment made on such invalid notice is deserves to be quashed and may kindly be quashed. 4. The ld. CIT(A) erred on facts as also in law in confirming addition of Rs.19,90,500/- on the alleged ground of failure to explain source of cash deposit of Rs.19,90,500/- In the bank account no.010003100043500 with Rajkot Nagrik Sahakari Bank Ltd. The addition made and confirmed without allowing opportunity of being heard is totally unjustified and uncalled for which deserves to be deleted may kindly be deleted. 5. The ld. CIT(A) erred on facts as also in law in confirming addition of Rs.1,60,000/- on account of estimated household expense. The addition I.T.A No. 199/Rjt/2022 A.Y. 2011-12 Page No Shri Kishorbhai Chhaganbhai Andipara vs. ITO 4 made was totally unjustified on facts as also in law and may kindly be deleted. 4.1. The Ld. Counsel Mr. Mehul Ranpura appearing for the assessee submitted that the assessee is prepared to appear before the Assessing Officer with all relevant materials and explain the case. The assessee being a Senior Citizen because of his ill health, he could not appear before the Lower Authorities and thereby the Ld. A.R. pleaded to set aside the matter back to the file of the Assessing officer. 5. Per contra, the Ld. D.R. appearing for the Revenue has no serious objection in setting aside the matter back to the file of the Assessing Officer for fresh consideration, provided the assessee should make use of this final opportunity given to the assessee. 6. We have given our thoughtful consideration and perused the materials available on record. As it can be seen from the Ld. CIT(A)’s order it is mentioned “the only ground related to addition on account of cash of Rs. 26,19,000/- deposited in Indian Corporation Bank, during the Financial Year 2010-11”. We do not find this figure of Rs. 26,19,000/- anywhere in the assessment order and no question of Indian Corporation Bank in the assessment order. Thus, we find Ld. NFAC did not applied its mind, while passing the above appeal. Though the Ld. NFAC has clearly extracted the grounds of appeal wherein the cash deposit of Rs. 19,90,500/- in Rajkot Nagrik Sahakari Bank Ltd., the Ld. NFAC has mentioned the sum of cash deposit as wrongly at I.T.A No. 199/Rjt/2022 A.Y. 2011-12 Page No Shri Kishorbhai Chhaganbhai Andipara vs. ITO 5 Rs.26,90,000/-. Thus the order passed by the Ld. NFAC is without application of mind and the same is liable to be set aside. Thus the Appellate order is set aside to the file of the Assessing Officer to pass fresh assessment order after giving due opportunity to the assessee to explain its case. 7. In the result, the appeal filed by the Assessee is allowed for statistical purpose. Order pronounced in the open court on 24-02-2023 Sd/- Sd/- (WASEEM AHMED) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER True Copy JUDICIAL MEMBER Ahmedabad : Dated 24/02/2023 आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपीलȣय अͬधकरण, राजकोट