DAMODARAN SURESH, GOBICHETTYPALAYAM V. ITO,WARD-2(1), ERODE

ITA 469/CHNY/2023

AI Insights

The case involves an appeal by Shri Damodaran Suresh, the proprietor of Sumy Electronics, against a revision order passed by the PCIT, Coimbatore-1. The revision was concerning the assessment year 2017-18, where the Income Tax Officer (ITO) had initially framed the assessment under section 143(3) of the Income Tax Act, 1961. The PCIT later revised this assessment under section 263, citing non-verification of cash deposits made during the demonetization period and violations of section 40A(3) of the Act. The assessee contested that the revision order was passed ex-parte without proper opportunity to present his case. The Tribunal agreed with the assessee's contention and remanded the case back to the PCIT for a fresh hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135096 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 03-07-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 11-04-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 40A(3)

Judgement Text

आयकर अपीलीय अिधकरण, ‘सी’ (एस एम सी) ᭠यायपीठ,चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ (SMC) BENCH, CHENNAI ᮰ी महावीर ᳲसह, उपा᭟यᭃ के समᭃ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT आयकर अपील सं./ITA No.:469/CHNY/2023 िनधाᭅरण वषᭅ/Assessment Year: 2017-18 Shri Damodaran Suresh, Prop. Sumy Electronics, No.52, Main Road, Gobichettipalayam – 638 452. PAN: AIJPS 3460M Vs. The Income Tax Officer, Ward-2(1), Erode. (अपीलाथᱮ/Appellant) (ᮧ᭜यथᱮ/Respondent) अपीलाथᱮ कᳱ ओर से/Appellant by : Shri G. Tarun, Advocate ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri P. Sajit Kumar, JCIT सुनवाई कᳱ तारीख/Date of Hearing : 04.07.2023 घोषणा कᳱ तारीख/Date of Pronouncement : 28.07.2023 आदेश /O R D E R This appeal filed by the assessee is arising out of the Revision order passed by the Principal Commissioner of Income Tax, Coimbatore-1 in Revision No.PCIT, Coimbatore-1/Revision- 263/100000329491/2022 dated 25.03.2022. The assessment was framed by the Income Tax Officer, Ward 1(1), Erode for the assessment year 2017-18 u/s.143(3) of the Income Tax Act, 1961 (hereinafter ‘the Act’) vide order dated 31.12.2019. - 2 - ITA No.469/Chny/2023 2 The only issue in this appeal of assessee is as against the revision order passed by PCIT u/s.263 of the Act revising the assessment framed by AO u/s.143(3) of the Act dated 31.12.2019. 3. I have heard rival contentions and gone through facts and circumstances of the case. The ld.counsel for the assessee pointed out that the revision order passed by the PCIT is ex-parte. He took me through para 4 which reads as under:- “4. In response to the above show cause notice, the case was posted for hearing on 21/03/2022. The assessee was given opportunity to appear in person or through their authorized representative or to file written submissions. However, none appeared for the hearing, nor any written submissions were received in this office. Therefore, the present proceeding initiated u/s.263 of the Act is disposed off based on the material available on record.” 3.1 The ld.counsel for the assessee urged that the matter can be restored back to the PCIT for redoing the revision order after allowing reasonable opportunity of being heard to the assessee. When this was pointed out to ld. Senior DR, he could not controvert the above fact situation. 4. I noted that the assessee is an individual engaged in the business of running an electronic shop by name M/s. Sumi Electronics, who has made cash deposits during demonetization period in its bank account in Specified Bank Notes amounting to - 3 - ITA No.469/Chny/2023 Rs.10,94,634/-. The AO has not verified the violation of provisions of section 40A(3) of the Act because the assessee has made payment in cash in excess of Rs.20,000/- to various parties as noted by PCIT amounting to Rs.85,03,246/-. Hence, the PCIT issued show cause. Since none was present before PCIT, he passed ex-parte order. I noted that the PCIT should have allowed opportunity of being heard to the assessee and hence, I set aside the order of PCIT and remand the matter back to his file for fresh adjudication. Accordingly, the appeal of the assessee is allowed for statistical purposes. 5. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 28 th July, 2023 at Chennai. Sd/- (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चे᳖ई/Chennai, ᳰदनांक/Dated, the 28 th July, 2023 RSR आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकर आयुᲦ /CIT 4. िवभागीय ᮧितिनिध/DR 5. गाडᭅ फाईल/GF.