MANISHKUMAR KANUBHAI KACHCHHI, SURAT V. INCOME TAX OFFICER, WARD-2(3)(2), SURAT

ITA 417/SRT/2023

AI Insights

The case involves an appeal by Manishkumar Kanubhai Kachchhi against the order of the National Faceless Appeal Centre, Delhi, which confirmed an addition of Rs. 1.44 Crore to the assessee's income under Section 69 of the Income Tax Act, 1961, due to unexplained credits in a bank account. The assessee's appeal was initially dismissed ex parte by the CIT(A) due to non-appearance, attributed to the illness of his representative. The Tribunal found that the CIT(A) had not considered the merits of the case as required under Section 250(6) of the Income Tax Act, 1961, and thus restored the matter to the Assessing Officer for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 302161 (ITAT-SURAT)
• Duration Of Justice: 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-08-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 15-06-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Additional evidence
• Section: 147; 69; 148; 144; 139

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. 417/Srt/2023 (Assessment Year 2011-12) (Virtual hearing) Manishkumar Kanubhai Kachchhi, C-101, Silver Nest, Near Siler Chowk, Yogi Chock to Puna Road, Punagam, Surat. PAN No. ANYPK 5830 F Vs. I.T.O. Ward -2(3)2, Surat Appellant/ assessee Respondent/ revenue Assessee represented by Shri Vardhman Jain, C.A. Department represented by Shri Vinod Kumar, Sr. DR Date of Institution of Appeal 16/06/2023 Date of hearing 21/08/2023 Date of pronouncement 21/08/2023 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 National Faceless Appeal Centre Delhi (NFAC / ld. CIT(A)) dated 19.04.2023 for the Assessment Year (AY) 2011-12, which in turn arise against the assessment order dated 11.12.2018 passed under section 144 r.w.s 147. In the assessment order the assessing officer made addition of Rs. 1.44 Crore under section 69 on account of credit in undisclosed bank account. 2. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that the appeal of assessee was dismissed by the ld. CIT(A) in an ex parte order. the ld AR for the assessee submits ITA No. 417/Srt/2023 Manishkumar Kanubhai Kachchhi Vs ITO 2 that the assessee appointed Sh Mihir Thakkar CA, to represent him before ld CIT(A)/ in faceless appeal. However, the said CA could not attend or inform the assessee as he fell sick and could not recovered. The non-appearance before ld CIT(A) is neither intentional nor deliberate but for the reasons that his AR was not well and still under treatment. His CA has given his affidavit that due to his illness, he could not keep the track of the appeal. The ld. CIT(A) has not passed the order on merit as mandated under Section 250(6) of the Income Tax Act, 1961. The ld AR for the assessee submits that the assessee is engaged in the business of trading of mobiles and accessories and all the credits in the bank account is sale proceeds of his bossiness. The ld AR for the assessee submits that he has also filed application of admissions of additional evidence under Rule 29 of Income Tax (Appellate Tribunal) Rules. The ld AR for the assessee submits that his application for admissions of additional evidence may be allowed and the reasonable profit from the business form the credit in bank account may be added. 3. The ld. AR of the assessee submits that the assessee has good case on merit and likely to succeed if he has given one more opportunity to contest the case on merit. The ld. AR of the assessee submits that the ld. CIT(A) confirmed the action of Assessing officer by taking a view that the assessee has failed to furnish any evidence in support of his ITA No. 417/Srt/2023 Manishkumar Kanubhai Kachchhi Vs ITO 3 contention and in absence of any evidence whatsoever whether documentary or otherwise. The ld. CIT(A) passed the order without considering the merit of the case. 4. On the other hand, the learned Senior Departmental Representative (Sr. DR) for the revenue supported the orders of the lower authorities. The ld. Sr. DR for the revenue submits that the assessee is non- cooperative during assessment proceedings as well as appellate proceedings. The assessee has filed the so called additional evidence before the Tribunal for the first time. No such evidence was filed before the lower authorities. The assessee has not shown any sufficient cause either for non-appearance before assessing officer again before ld CIT(A) or about not filing the evidence. The assessee has not filed return of income either under section 139 or in response to notice under section 148. The assessee does not deserve any leniency and the application for admission of additional evidence as well as appeal of the assessee is liable to be dismissed. 5. In alternative submissions, the ld Sr DR for the revenue submits that in case this bench is of the view that the assessee deserve one more opportunity, in such circumstances, the matter may be restored back to the file of assessing officer with the specific direction to the assessee, not to make any default in future and make all compliance in time. The evidence if any with assessee has to be considered by assessing officer. ITA No. 417/Srt/2023 Manishkumar Kanubhai Kachchhi Vs ITO 4 6. We have heard the submissions of both the parties and record perused. We find that the Assessing Officer passed the assessment order under Section 144/ 147 of the Income Tax Act, 1961 (in short, the Act) by making addition 1.448 Crore on account of unexplained credit in the bank, which has not been disclosed to the income tax department. The Assessing Officer made addition by holding that the assessee failed to furnish return of income in response to the notice under section 148 and further failed to file necessary details. The ld. CIT(A) also confirmed the addition for want of submission in ex-party order. We find that the assessee has now shown sufficient cause for non- appearance before ld CIT(A), as his representative was suffering with severe back pain and is still under treatment. The ld CA has also filed his affidavit to substantiate the contention of assessee. 7. We further find that Assessing Officer has passed the assessment order was also passed under section 143(3). The ld CIT(A) also dismissed the appeal in ex-parte, without discussing the merit of the case, the order of ld CIT(A) is also not in accordance with the mandate of section 250(6). We find that due to non-representation before ld CIT(A), the assessee lost his appeal. We find that substantial right of the assessee are involved in the present appeal. Thus, in our view the assessee require one more opportunity to explain and substantiate his claim, therefore, we think it appropriate to restore the grounds of appeal back ITA No. 417/Srt/2023 Manishkumar Kanubhai Kachchhi Vs ITO 5 to the file of Assessing Officer to consider the case afresh by giving adequate opportunity of hearing to the assessee. The assessee is also directed to be more vigilant in future and not to cause further delay and seek adjournment without any valid reason and to furnish all the details and his submissions and evidences on various grounds of appeal raised by him, as soon as possible, if so desired without any further delay. As this case relates to AY 2011-12, the assessing officer is expected to expedite the matter as early as possible. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes. 9. In the result, the appeal of assessee is allowed for statistical purposes. Order announced in open court on 21 August, 2023 at the time of hearing. Sd/- Sd/- (Dr. ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 21/08/2023 *Ranjan Copy to: 1. Assessee – 2. Revenue – 3. CIT 4. DR 5. Guard File By order Sr. Private Secretary, ITAT, Surat