Kamal Kishore Malani , Hyderabad V. Asst. Commissioner of Income Tax, Circle-4(1), Hyderabad

ITA 624/Hyd/2019

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6097 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2021
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB-B
• Assessment Year: 2008-2009
• Appeal Filed On: 25-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit
• Section: 143(3); 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “A”, HYDERABAD (Through Virtual Hearing) BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SRI S.S. GODARA, JUDICIAL MEMBER ITA No. 624/Hyd/2019 A.Y. 2008-09 Kamal Kishore Malani, Hyderabad. PAN: ABZPM 2703 Q VS. ACIT, Circle-4(1), Hyderabad. (Appellant) (Respondent) Assessee by Sri A.V. Raghuram Revenue by Sri Subbaraju Penmetsa, Sr. AR Date of hearing: 14/12/2021 Date of pronouncement: 20/12/2021 ORDER PER A. MOHAN ALANKAMONY, A.M: This appeal is filed by the assessee against the order of the Ld. CIT(A)-1, Hyderabad in appeal No. 0135/16-17/ACIT, Circle- 4(1)/CIT(A)-1/Hyd/2018-19, dated 06/11/2018 passed U/s. 143(3) r.w.s 147 of the Income Tax Act, 1961 for the A.Y. 2008-09. 2. The assessee has raised six grounds in its appeal, and they are extracted in below for reference: “1. On the facts and in the circumstances of the case, the order of the Ld. CIT(A)-1, Hyderabad is erroneous and unsustainable on facts and in law. 2 2. The Ld. CIT(A) erred in sustaining the action of the A.O. in making assessment without service of statutory notices u/s 142(1) and 143(2) of the Act. 3. The Ld. CIT(A) failed to appreciate that the reassessment proceedings is bad in law as the (sic) resorted to service of notice by affixture without serving notice on the appellant through normal mode of service on his last known address. The CIT(A) ought to have appreciated that the above procedure is mandatory as held by the jurisdictional high court. 4. The Ld. CIT(A) erred in not appreciating the fact that the A.O. did not have jurisdiction over the appellant and the reassessment made is bad in law. 5. Without prejudice to above legal grounds, the CIT(A) erred in upholding the addition of Rs. 2,06,09,862/- made by the appellant is unexplained credits in the bank account of the appellant. The CIT(A) ought to have appreciated that only the commission income embedded in the transactions conducted by the appellant could have been brought to tax but not the entire deposits. 6. On the facts and in the circumstances of the case, the CIT(A) erred in holding that the appellant failed to lead any evidence in support of his case, in as much as the written submissions and the nature of transactions in the bank account would lead to irresistible conclusion that the appellant carried on cheque discounting business and only commission income could have been brought to tax.” 3. At the outset, the Ld. AR submitted that there is a delay of 77 days in filing the appeal before the Tribunal. In this regard, the assessee had filed a condonation petition wherein it was stated that due to inadvertent omission by the office staff of the assessee’s Chartered Accountant, the appeals could not be filed before Tribunal within the prescribed time limit. The relevant portion from the assessee’s condonation petition is extracted herein below for reference: “The order of the Ld. CIT(A) was received by the office of the present Counsel, who were handling the first appeal also on 10/12/2018 and the same was communicated to Sri K.G. Maniyar, Chartered Accountant through mail on 12/12/2018, who was guiding me with accounting and tax matters. However, to the information given by Sri K.G. Maniyar the mail went to his junk mail folder and got deleted. My present counsel was waiting for the instructions for preparing further appeal and later lost sight as they thought I was not interested in filing 3 further appeal. Later, in the 4 th week of April, 2019 when I approached Sri K.G. Maniyar for the accounting work, I enquired about the status of the appeal filed before the Hon’ble CIT(A). Sri K.G. Maniyar has enquired with our counsel and he was informed that the Ld. CIT(A) has dismissed the appeal and the said order was also sent to him through mail. We immediately took steps to approach our Counsel’s office and on our instructions the appeal documents are prepared and the appeal was filed before the Hon’ble Tribunal on 26/04/2019 with delay of 77 days. 5. It is submitted that the delay in filing the appeal is not wilful but is on account of the reasons aforesaid. It is submitted that the appellant did not stand to gain in any manner on account of the delay in filling the appeal and on contrary, he is at the risk of losing a valuable right to have the appeal adjudicated. The inadvertent mistake happened at the office of Sri K.G. Maniyar, Chartered Accountant which is not wilful.” 4. On perusing the reasons stated by the assessee for filing the appeal with a delay of 77 days we are of the view that the delay cannot be attributable to the fault of the assessee. Therefore, we hereby conde the delay of 77 days in filing the appeal before the Tribunal and proceed to adjudicate the case on merits. 5. At the outset, the Ld. AR submitted before us by stating that the Ld. CIT (A) has passed ex-parte order without providing proper opportunity to the assessee of being heard. It was therefore pleaded that the matter may be remitted back to the file of the Ld. CIT (A) in order to provide one more opportunity to the assessee of being heard. Ld. DR, on the other hand, vehemently opposed to the submissions of the Ld. AR and argued that sufficient opportunities had been provided to the assessee however, on the given dates of hearing, neither the assessee nor its Representative appeared before the Ld. CIT (A). Therefore the Ld. CIT (A) had no other option but to pass ex-parte order 4 based on the materials available on record. Hence, it was pleaded, that the order passed by the Ld. CIT(A) does not call for any interference. 6. We have heard the rival submissions and carefully perused the materials on record. On examining the facts of the case, We find merit in the submissions of the Ld. DR. The Ld. CIT (A) had posted the case on several occasions. However, none appeared on behalf of the assessee before the CIT(A) on the dates of hearing. Therefore, the Ld. CIT (A) was left with no other option except to adjudicate the appeal ex-parte. In this situation, We do not find much strength in the arguments advanced by the ld. AR. However, considering the prayer of the Ld. AR as well as the issues involved in the appeal, in the interest of justice, We hereby remit the matter back to the file of Ld. CIT (A) in order to consider the appeal afresh on merits by providing one more opportunity to the assessee of being heard. At the same breath, We also hereby caution the assessee to promptly co-operate before the Ld. CIT (A) in the proceedings, failing which the Ld. CIT (A) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on the record. It is ordered accordingly. 5. In the result, appeal filed by the assessee is allowed for statistical purposes as indicated hereinabove. 5 Pronounced in the open Court on the 20 th December, 2021. Sd/- Sd/- (S.S. GODARA) (A. MOHAN ALANKAMONY) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 20 th December, 2021. OKK Copy to:- 1) Sri Kamal Kishore Malani, 3-2-846/B/B, 1 st Floor, Kachiguda, Hyderabad. 2) ACIT, Circle-4(1), IT Towers, Masab Tank, Hyderabad – 500 004. 3) The CIT(A)-1, Hyderabad. 4) The Principal Commissioner of Income Tax, Circle-4(1), Hyderabad. 5) The DR, ITAT, Hyderabad 6) Guard File