Chetan Dhirajlal Tanna, Ahmedabad V. The ITO, Ward-2(2)(1), Ahmedabad

ITA 354/AHD/2020

AI Insights

The case involves Chetan Dhirajlal Tanna, the appellant, who faced penalties for unexplained cash deposits totaling Rs. 7.42 crores in his bank account during the Assessment Year 2011-12. The Income Tax Officer (ITO) initiated penalty proceedings after the assessee failed to provide satisfactory explanations during the assessment and subsequent appellate stages. The Commissioner of Income Tax (Appeals) confirmed the penalty, which was later upheld by the Tribunal. The Tribunal noted the assessee's repeated non-appearance and non-cooperation throughout the legal proceedings, leading to the dismissal of his appeal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 114111 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-07-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 22-06-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Source of fund
• Section: 271(1)(c); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “A” BENCH Before: Smt. Annapurna Gupta, Accountant Member And Shri T.R. Senthil Kumar, Judicial Member Chetan Dhirajlal Tanna, 102, Ajor Residency, Sarvoday Society, Acher, Ramnagar, Sabarmati, Ahmedabad-380005 PAN: ADZPT9482F (Appellant) Vs The ITO, Ward-2(2)(1), Ahmedabad (Respondent) Assessee Represented: None Revenue Represented: Shri Atul Pandey, Sr.D.R. Date of hearing : 10-07-2023 Date of pronouncement : 12-07-2023 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- This appeal is filed by the Assessee as against the appellate order dated 31.01.2020 passed by the Commissioner of Income Tax (Appeals)-10, Ahmedabad, confirming the Penalty levied under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year (A.Y) 2011-12. ITA No. 354/Ahd/2020 Assessment Year 2011-12 I.T.A No. 354/Ahd/2020 A.Y. 2011-12 Page No Chetan Dhirajlal Tanna. vs. ITO 2 2. The Registry has noted that there is delay of 79 days in filing the above appeal by the assessee. This appeal is filed by the assessee on 23.06.2020. This period falls under COVID-Pandemic situation, thus following Hon’ble Supreme Court judgment dated 23.9.2021 in M. A. No. 665 of 2021 in suo-moto Writ Petition (Civil) No.3 of 2020, the Hon’ble Supreme Court has excluded time limit for filing appeal from 15.3.2020 till 02.10.2021. Thus, there is no delay in filing the above appeal and we take up the assessee appeal for adjudication. 3. Today is the 15 th time of hearing of the above appeal, None appeared on behalf of the assessee in spite of service of notices. Even in the previous hearings None appeared or represented on behalf of the assessee. This clearly shows that the assessee is not interested in pursuing the above appeal. With available materials on record, we proceed to dispose of the above appeal. 4. The Ld. Sr. D.R. Shri Atul Pandey appearing for the Revenue submitted that the assessment was passed is also Best Judgment Assessment under section 144 and the main issue is with regard to unexplained cash deposit of Rs. 7.42 crores in the bank account of the assessee. The assessee’s first appeal before Ld. CIT(A) was dismissed on 13-10-2016. It is thereafter the Assessing officer initiated penalty proceedings to levy penalty u/s. 271(1)(c) of the Act on account of concealment of income of Rs. 7.44 crores. 4.1. Even during the penalty proceedings, the assessee has not filed any reply and not participated in the hearing, thereby the Ld. A.O. levied a minimum penalty of Rs. 2.28 crores. The assessee’s I.T.A No. 354/Ahd/2020 A.Y. 2011-12 Page No Chetan Dhirajlal Tanna. vs. ITO 3 quantum appeal before this Tribunal was also dismissed on 12-10- 2022 in ITA No. 5/Ahd/2019. During the penalty appeal before Ld. CIT(A), there was no evidences produced before the Appellate Authority. Therefore the Ld. CIT(A) dismissed the appeal observing as follows: “.....10. On Merits the appellant has taken a view that only credit side entries have been added by the Assessing Officer, the same has been done by the AO in the absence of any explanation being submitted by the appellant. No details have been filed by the appellant before Hon'ble ITAT as well. This defense cannot be admitted at this stage. If any relief is given to the appellant on merits in quantum appeal then consequent effect will follow in penalty also. Therefore, no relief is provided to the appellant on this issue. In result the grounds of appeal taken by the appellant are dismissed.” 4.2. Thus the Ld. Sr. D.R. pleaded to dismiss the appeal filed by the assessee. 5. The assessee is in appeal before us raising the following Grounds of Appeal: 1. In law, on the facts and in the circumstances of the case, the impugned penalty order passed by the Income Tax Officer, Ward-2(2)(1), Ahmedabad and subsequently confirmed by the ld CIT(A) is against natural justice, bad in law and deserves to be cancelled. 2. On the facts, in law and in the circumstances of the case, the ld. CIT(A)- 10. Ahmedabad has grossly erred in confirming Penalty of Rs. 2,28,55,310/- under section 271(1)(c) of the I.T. Act. He may be directed to delete the same. 3. The appellant craves leave to add, alter, amend and/or withdraw any ground/s of an appeal on or before hearing of the appeal. 6. We have given our thoughtful consideration and perused the materials available on record. Right from the assessment proceedings, the assessee was non-cooperative with the Department in spite of 8 hearing notices given, the assessee has I.T.A No. 354/Ahd/2020 A.Y. 2011-12 Page No Chetan Dhirajlal Tanna. vs. ITO 4 neither replied nor filed any details before the Assessing Officer. In the absence of any details, the Assessing Officer treated the cash deposit of Rs. 7,42,62,300/- in the bank account of the assessee as unexplained income in the hands of the assessee. During the penalty proceedings also, the assessee has not made any reply or filed any submissions before the Assessing Officer, thereby the Ld. A.O. levied penalty u/s. 271(1)(c) of Rs. 2,85,55,310/- for concealment of income. 6.1. It is further seen from the decision of the Co-ordinate Bench of this Tribunal in the quantum appeal of the assessee in ITA No. 5/Ahd/2019 dated 12-10-2022 dismissing the same observing as follows: “.....3. The addition of Rs.7,42,62,300/- made by the Assessing Officer by treating the cash deposits found to be made in his bank account was challenged by the assessee in an appeal filed before the learned CIT(A). During the course of appellate proceedings, the learned CIT(A) fixed the appeal of the assessee for hearing on as many as 16 occasions. The assessee, however, either sought adjournment or did not attend the hearing. He also failed to offer any explanation as regards the source of cash deposits found to be made in his bank account in spite of sufficient and specific opportunity given by the learned CIT(A) in this regard. The learned CIT(A), therefore, proceeded to dispose of the appeal of the assessee ex-parte vide his appellate order dated 03.10.2016 whereby he confirmed the addition of Rs.7,42,62,300/- made by the Assessing Officer on account of unexplained cash deposits found to be made in the bank account of the assessee. Aggrieved by the order of the learned CIT(A), the assessee has preferred this appeal before the Tribunal. 4. It is noted from the record that the appeal of the assessee was fixed for hearing initially on 07.02.2022. The assessee, however, sought adjournment and the appeal of the assessee thereafter was fixed for hearing on 27.06.2022. None, however, appeared on behalf of the assessee on 27.06.2022 nor any application seeking adjournment was filed. In order to give one more opportunity to the assessee, the hearing was adjourned by the Bench to 02.08.2022. The assessee again sought adjournment on 02.08.2022 and accordingly the hearing was adjourned to 07.09.2022. On 07.09.2022, again none appeared on behalf of the assessee. The Authorized Representative of the assessee, Advocate Vijay I.T.A No. 354/Ahd/2020 A.Y. 2011-12 Page No Chetan Dhirajlal Tanna. vs. ITO 5 H. Patel, however, has filed a letter dated 07.09.2022 seeking permission to withdraw his appearance on the ground that no instructions are forthcoming from the assessee. Keeping in view this non-compliant and non-cooperative attitude of the assessee and the fact that sufficient opportunity has already been given to the assessee which he has failed to avail, this appeal of the assessee is being disposed of ex-parte after hearing the arguments of learned DR and perusing the relevant material available on record. 5. It is observed that proper and sufficient opportunity was given to the assessee by the Assessing Officer during the course of assessment proceedings as well as by the learned CIT(A) during the course of appellate proceedings to explain the source of cash deposits found to be made in his bank account with Sarvodaya Commercial Co-op. Bank Ltd. The assessee, however, failed to offer any satisfactory explanation as regards the source of funds utilized for making the said cash deposits. Even during the course of appellate proceedings before the Tribunal, no explanation whatsoever has been offered by the assessee as regards the source of funds utilized for making the said cash deposits in spite of sufficient opportunity afforded to him. Keeping in view this failure of the assessee, we find no justifiable reason to interfere with the impugned order of the learned CIT(A) confirming the addition of Rs.7,42,62,300/- made by the Assessing Officer on account of cash deposits found to be made in the account of the assessee with Sarvodaya Commercial Co-op. Bank Ltd. by treating the same as unexplained. The same is, therefore, upheld and this appeal of the assessee is dismissed. 6. In the result, the appeal of the assessee is dismissed.” 6.2. It is seen from record that one Vakalatnama by Shri Vijay H Patel was filed on 14-06-2022 and sought for adjournment for four weeks period to take the appropriate instruction from the assessee. However, thereafter neither the assessee nor the Representative appeared for the above appeal. It is seen from the assessment order is an exparte order, the assessee has not represented during the penalty proceedings. In the quantum appeal before this Tribunal also None appeared and thereby the appeal was dismissed. 6.3. In the absence of any details or explanation from the assessee, we have no hesitation in dismissing the present penalty appeal filed I.T.A No. 354/Ahd/2020 A.Y. 2011-12 Page No Chetan Dhirajlal Tanna. vs. ITO 6 by the assessee. Thus the Grounds raised by the assessee are hereby dismissed. 7. In the result, the appeal filed by the assessee is hereby dismissed. Order pronounced in the open court on 12-07-2023 Sd/- Sd/- (ANNAPURNA GUPTA) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER True Copy JUDICIAL MEMBER Ahmedabad : Dated 12/07/2023 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, अहमदाबाद