Shri Hiteshbhai Bhikhabhai Patel, Bharuch V. The Assessing Officer, Income Tax Officer, Ward - 1(2), Bharuch

ITA 252/SRT/2023

• Counselvise Citation: [2024] 130 COUNSELVISE.COM (IT) 4673 (ITAT-SURAT)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-03-2024
• Assessment Year: 2012-2013
• Appeal Filed On: 16-04-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Business income; Reassessment proceedings
• Section: 148; 144; 143(2); 44AD; 69A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA No. 252/Srt/2023 (Assessment Year 2012-13) (Physical hearing) Hiteshbhai Bhikhabhai Patel, 116, Chhellu Faliya, Vilage-Bhuva, Bharuch-392012. PAN No. BOHPP 5707 H Vs. I.T.O., Ward 1(2), Bharuch Appellant/ Assessee Respondent/ Revenue Assessee represented by Shri Krutarth Desai, Advocate with Ms. Disha Kharod, C.A. Department represented by Shri Vinod Kumar, Sr. DR Appeal instituted on 18/04/2023 Date of hearing 12/03/2024 Date of pronouncement 12/03/2024 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 the National Faceless Appeal Centre, Delhi (NFAC)/learned Commissioner of Income Tax (Appeals) [in short, the ld. CIT(A)] dated 28/02/2023 for the Assessment Year (AY) 2012-13 wherein the assessee has raised following grounds of appeal: “1. The Learned CIT (Appeals) has erred in considering the factual matrix of the case that the property was jointly owned by the appellant along with nineteen other co-owners and share of the appellant was deposited in the bank account of the appellant. 2. The Learned CIT (Appeals) has erred in considering the fact that the property was an agriculture land and therefore it ought not to have been taxed. Therefore the addition deserved to be deleted. ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 2 3. The Learned CIT (Appeals) has erred in arriving to the conclusion that sum of Rs. 13,80,042/- is taxable irrespective of the fact that Rs. 13,75,000/- is the business income of the appellant for which Return of Income has been filled by the appellant under Section 44AD of the Income Tax Act, 1961. 4. The appellant craves for add or alter or amend any other grounds of appeal. 2. Vide application dated 12/03/2024, the assessee has raised following additional grounds of appeal: “1. Whether in the facts and circumstances of the case, whether notice under section 143(2) of the Act is mandatory in nature? IN the case of answer of the aforesaid question is yes then whether the present assessment order is required to be quashed and set aside in view of the fact that the notice under section 143(2) has not been issued by the learned assessing officer in reassessment proceedings? 2. Whether reassessment proceedings under section 148 is bad in law where it relates to the grounds that cash has been deposited in the bank account of the appellant? 3. Rival submissions of both the parties have been heard and record perused. The learned Authorised Representative (ld. AR) of the assessee submits that the assesse has raised additional grounds of appeal raising objection/grounds that notice under Section 143(2) of the Income Tax Act, 1961 (in short, the Act) was not issued by the Assessing Officer. The additional grounds of appeal raised by the assessee is purely legal in nature. No additional fact is required to be brought on record. The facts regarding adjudication of such issue is emanating/ can be ascertained from the record/orders of the lower authorities. To support such contention, the assessee relied upon the decision of Hon'ble Apex Court in the case of National Thermal Power Co. Ltd. Vs CIT dated 04/12/1996. ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 3 Against original grounds of appeals, the ld. AR of the assessee submits that the assessee was not given fair and reasonable opportunity by the lower authorities. The Assessing Officer made addition on account of cash deposit in bank by taking a view that the complete details were not furnished. The ld. CIT(A) confirmed the action of Assessing Officer in ex parte order without giving any independent finding. The order of ld CIT(A) is not in accordance with the mandate of section 250(6) of income Tax Act. The ld. AR of the assessee submits that he has good case on merit on additional ground of appeal and that he has filed details of notices/communication issued by the Assessing Officer through ITBA Portal. The Assessing Officer issued notice under Section 148 of the Act dated 27/03/2019 and notice under Section 142(1) of the Act on 03/11/2019. Even in the entire assessment order, there is no reference if the notice under Section 143(2) of the Act was issued. To support his submissions, the ld. AR of the assessee relied upon the decision of Hon'ble Calcutta High Court in Pr.CIT Vs. M/s Eversafe Securities Pvt. Ltd. Tax appeal No. 156/2022 dated 02/01/2023. 4. On the other hand, the learned Senior Departmental Representative (ld. Sr. DR) for the revenue supported the orders of lower authorities. The ld. Sr. DR for the revenue submits that during the assessment, the Assessing Officer issued a number of show cause notice, the assessee ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 4 failed to furnish complete details in response to such notices. The Assessing Officer in absence of any explanation or evidence has no option except to make addition on account of unexplained deposits. Again before the ld. CIT(A), the assessee has not made any compliance despite giving more than sufficient opportunity as recorded in para 3 of order of ld. CIT(A). The ld. CIT(A) has no option except to confirm the order of Assessing Officer. On the additional ground of appeal, the ld. Sr. DR for the revenue submits that no such ground of appeal was raised by assessee before the ld. CIT(A) nor any such objection was filed before the Assessing Officer. Mere filing screenshot of ITBA Portal is not sufficient for adjudication of additional ground of appeal. In the screenshot, the notice under Section 148 of the Act is shown to have been issued on 27/03/2019, however, in para 1 of assessment order, the Assessing Officer has clearly recorded that notice under Section 148 of the Act was issued on 27/03/2019. The assessee has not shown any reasonable and plausible explanation for non-appearance before the lower authorities. The ld. Sr. DR for the revenue seriously objected for raising additional grounds of appeal. The ld Sr DR for the revenue submits that the assessee does not deserve any leniency at this stage. 5. We have considered the rival submissions of both the parties and perused the orders of the lower authorities carefully. We have also ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 5 perused the various evidences filed in the paper book including screenshot of various notices from ITBA Portal with regard to assessee. We find that the case of assessee was reopened on the basis of information on ITD system that the assessee has made cash deposit of Rs. 30,70,000 lacs in Bank of Baroda and that no return of income was filed by assessee. The Assessing Officer after taking proper approval of PCIT, Vadodara, issued notice under Section 148 of the Act on 27/03/2019. In response to such notice, the assesse filed return of income on 17/09/2019. The Assessing Officer noted that the assesse has not e-verify the return of income and treated the same as invalid return. The assessing officer proceeded for assessment and noted that the assessee has not responded to his various notices issued under section 142(1). The assessing officer in order to verify the facts issued notice to the banker of assessee under section 133(6). The banker of the assessee informed that there was other credit of Rs. 13,80,042/- in the bank account of the assessee. The assessing officer on the basis of information of his banker find that there was total cash and credit of Rs. 44,50,042/- (3070000+1380042). The assessing officer in absence of any justification made addition of Rs. Rs. 44,50,042/- under section 69A on account of unexplained money in the assessment order dated 12.12.2019 passed under section 144 rws 147. ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 6 6. On appeal before the ld. CIT(A), the action of Assessing Officer was upheld in ex parte proceedings. Before us, the ld. AR of the assessee has raised additional grounds of appeal. We find that the additional grounds of appeal is purely legal in nature and can be adjudicated merely on verification of records of lower authorities. However, the facts remained the same that such grounds of appeal was not raised before the ld. CIT(A), therefore, considering the fact that the additional grounds of appeal can be adjudicated on the basis of material available on record and verification thereof. Therefore, the additional grounds of appeal is admitted. Further considering the fact that the assessee has not made any written submission or compliance in response to various notices issued by the ld. CIT(A) as well as before assessing officer, thus, in our view the assessee deserve one more opportunity of hearing on merit. Therefore, the additional grounds of appeal alongwith original grounds of appeal is restored back to the file of ld. CIT(A) with direction first to verify the facts if notice under Section 143(2) of the Act was issued or not, if such notice is not issued, the ld. CIT(A) shall pass the order by considering the decision of Hon'ble Calcutta High Court in Pr.CIT Vs. M/s Eversafe Securities Pvt. Ltd.(supra). And in case the issue of non-issuance of notice under section 143(2) is decided against the assessee, the ld CIT(A) will decide other grounds of appeal on merit in accordance with law. Needless to direct that before passing the order, ITA No. 252/Srt/2023 Hiteshbhai Bhikhabhai Patel Vs ITO 7 the ld. CIT(A) shall grant reasonable opportunity of hearing to the assessee. The assessee is also directed to be more vigilant and to furnish complete details to substantiate the agricultural income, expenses and cash credit/deposit. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes only. 7. In the result, this appeal of assessee is allowed for statistical purposes. Order announced in open court 12 th March, 2024. Sd/- Sd/- (Dr. ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 12/03/2024 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT 4. DR By order 5. Guard File Sr. Private Secretary, ITAT, Surat