Tirumala Construction , Nashik V. ITO, Ward 2(4), , Nashik

ITA 584/PUN/2024

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 2336 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 21-03-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ TRIPATHI
• Assessee Lawyers: FILING DOCUMENTARY EVIDENCES BEFORE
• Keywords: Opportunity of being heard; Reasonable cause; Condonation of delay
• Section: 144; 142(1); 143(2); 69A; 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC”, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.584/PUN/2024 िनधाᭅरण वषᭅ / Assessment Year : 2017-18 Tirumala Construction, ASE 78, Ashwin Nagar Sector, Pathardi Phata, Nashik- 422009. PAN : AAEFT2512Q Vs. ITO, Ward-2(4), Nashik. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 29.08.2023 passed by Ld CIT(A)/NFAC for the assessment year 2017-18. 2. The present appeal is filed belatedly i.e. with the delay of 145 days. The appellant furnished an application along with an affidavit praying for condonation of delay in the circumstances mentioned therein. Ld. Sr. DR could not controvert the averments made in the Assessee by : Shri Sanket Joshi Revenue by : Shri Manoj Tripathi Date of hearing : 30.04.2024 Date of pronouncement : 15.05.2024 ITA No.584/PUN/2024 2 above affidavit. We are of the considered opinion that the reasons mentioned by the assessee constitute reasonable cause for not filing the appeal within prescribed time. In the circumstances, the delay is hereby condoned and the appeal is admitted for adjudication. 3. The appellant raised the following grounds of appeal :- “1] The learned CIT(A) erred in confirming the addition u/s 69A of Rs. 19,91,000 made by the A.O. in the asst, order passed u/s 144 by treating entire cash deposits allegedly made during demonetization period as unexplained money without providing proper opportunity of being heard to the assessee. 2] The learned CIT(A) failed to appreciate that the actual quantum of cash deposits made during demonetization period was only Rs.l0,91,000 and the source of entire cash deposits was duly explained by the assessee by filing documentary evidences before the A.O. and therefore, the CIT(A) was not justified in dismissing the appeal in limine without passing any speaking order on merits. 3] The learned CIT(A) erred in not appreciating that the assessee had filed an ITR for A.Y. 2017 - 18 in response to notice u/s 142(1) and therefore, the asst, order passed u/s 144 without issuing any notice u/s 143(2) intimating the assessee regarding selection of its ITR for scrutiny, was bad in law. 4] Without prejudice to above grounds, the appellant submits that all the notices issued by the CIT(A) were issued on the email id and not served physically post and the partners of the appellant firm were not aware of the fact that the hearing notices will be served only on email and therefore, they were not in the practice of checking the email id and hence, it is prayed that the matter may be sent back to the file of CIT(A)/ A.O. for fresh adjudication on merits after affording reasonable opportunity of being heard to the assessee. 5] The appellant craves leave to add/ alter/ amend any of the grounds of appeal.” ITA No.584/PUN/2024 3 4. Briefly, the facts of the case are that the appellant assessee is a firm. No return of income for the assessment year under consideration was filed under the provisions of section 139(1) of the Act. Based on the information available with the AIR that the assessee had deposited cash of Rs.14,91,000/- in Saraswat Co- operative Bank, Nashik and Rs.5,00,000/- in Allahabad Bank, Nashik. during the demonetization period. Under “Operation Clean Money”, the Assessing Officer issued notice u/s 142(1) of the IT Act on 10.03.2018 as during the aforesaid period, the quantum of cash deposited by the assessee in his bank account exceeds the minimum threshold limit which is not chargeable to tax for the relevant year but no voluntarily return has been filed by the assessee. However, no compliance was made by the assessee in reply to the notices issued u/s 142(1) of the Act, the Assessing Officer in the order passed u/s 144 of the IT Act determined the total income of the assessee at Rs.19,91,000/- by treating the entire cash deposits into the bank account of the assessee during the demonetisation period as unexplained money u/s 69A of the IT Act. 5. Being aggrieved by the above action of the Assessing Officer, an appeal was filed before ld. CIT(A)/NFAC. Since assessee ITA No.584/PUN/2024 4 remained absent before the LD CIT(A)/NFAC, the appeal was dismissed vide impugned order dated 29-08-2023 confirming the addition made by the Assessing Officer. 6. Being aggrieved by the decision of ld. CIT(A)/NFAC, the appellant assessee is in appeal before this Tribunal. 7. The LD AR submitted before us that the assessee furnished return of income for Asstt Year 2017-18 on 29-03-2018 i.e. after the due date but before the last date for furnishing return of income. It was submitted by LD Counsel of the assessee that earlier the jurisdiction was with some other AO & on 25-10-2019 another AO issued notice u/s 142(1) of the IT Act to explain the source of cash deposit in the banks. In response to the same a detailed written submission along-with copy of return for Asstt Year 2017-18 & other relevant documents such as sale bills etc for carrying out excavation work were submitted before the AO. In the assessment order the AO did not considered the return filed by the assessee & also did not issued any notice u/s 143(2) of the IT Act. Even the documents furnished on 20-11-2019 in response to notice u/s 142(1) of the IT Act were not found satisfactory/concrete evidence to substantiate the source of cash receipts. In response to show cause ITA No.584/PUN/2024 5 notice dt. 21-11-2019 it was again clarified that sales invoices are already submitted but the AO did not accepted those sale bills as conclusive proof of cash deposit by treating them as self made vouchers. Under these circumstances it was submitted by the counsel of the assessee that the AO erred in not accepting the explanation of the assessee & further erred in making the addition of Rs.19,91,000/- treating the same as unexplained money u/s 69A of the IT Act. Regarding LD CIT(A)/NFAC’s order it was submitted by LD Counsel of the assessee that all the notices were served through email only & the partners of the firm were not aware of the fact that the hearing notices will be served only on the email & therefore they were not in practice of checking the email & hence could not respond to the notices issued by LD CIT(A)/NFAC. Therefore it was prayed by LD counsel of the assessee that the matter may kindly be sent back to the file of LD CIT(A)/NFAC / the AO for fresh adjudication on merits after affording reasonable opportunity of hearing to the assessee. 8. The LD DR supported the orders passed by subordinate authorities & requested to confirm the above orders. ITA No.584/PUN/2024 6 9. We have heard LD counsels from both the sides & perused the material available on the record. We find that the return for Asstt Year 2017-18 was furnished by the assessee & written submission was also filed before the AO along with copies of sales bills & copy of IT Return. The notices were issued on email id & the partners were not aware with the fact that the no physical notice will be issued & therefore they could not see the notices sent on email id, which resulted in this unfortunate event. We find that the order was passed by LD CIT(A)/NFAC in the absence of the assessee, apparently the merits of the case has not been dealt with by LD CIT(A)/NFAC. We therefore in the interest of justice, deem it proper to provide one more opportunity to the assessee to explain his case before LD CIT(A)/NFAC. Hence we set-a-side the order passed by LD CIT(A)/NFAC with direction to decide the appeal on merits after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to submit the details/ explanations in support of the grounds of appeal on merit before LD CIT(A)/NFAC on the appointed day without seeking any adjournment under any pretext, failing which LD CIT(A)/NFAC is at liberty to pass appropriate orders as per law. We hold & direct ITA No.584/PUN/2024 7 accordingly. The grounds of appeal in the appeal filed by the assessee are allowed for statistical purposes. 10. In the result, the appeal of the assessee stands allowed for statistical purposes. Order pronounced in the open Court on 15 th day of May, 2024. Sd/- Sd/- (INTURI RAMA RAO) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 15 th May, 2024. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “SMC” बᱶच, पुणे / DR, ITAT, “SMC” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.