Sh. Harjinder Singh, Kurukshetra V. ITO, Ward 4(1), Chandigarh

ITA 631/CHANDI/2022

AI Insights

The case involves an appeal by Sh. Harjinder Singh against the order of the ld. CIT(A), National Faceless Appeal Centre, Delhi, which confirmed the addition of Rs. 13,20,000 as unexplained capital introduced in the assessee's firm, M/s VRRH. The original assessment was made under section 143(3) of the Income Tax Act, 1961, and the addition was made under sections 143(3) read with section 147. The assessee contested the re-opening of the case under section 148 as illegal and void-ab-initio. The CIT(A) passed an ex-parte order, which the assessee challenged, claiming that all applications and replies were e-filed and visible on the portal. The Tribunal found that the CIT(A) had dismissed the appeal without considering the material on record and without going into the merits of the case, thus remitting the matter back for a fresh decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127817 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 16-05-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 22-09-2022
• Other Referred Cases: S. Velu Palandar Vs. DCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift
• Section: 148; 143(3); 250

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH, ‘B’, CHANDIGARH BEFORE SHRI A.D. JAIN, VICE PRESIDENT & SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 631/CHD/2022 नधा रण वष / Assessment Year : 2008-09 Sh. Harjinder Singh, House No. 155, Model Town, Pehowa, Kurukshetra Vs. बनाम The ITO, Ward No. 4(1), Chandigarh थायी लेखा सं./PAN NO: ATUPS7823C अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से/Assessee by : Sh. Parikshit Aggarwal, CA राज व क ओर से/ Revenue by : Smt. Amanpreet Kaur, Sr.DR स ु नवाई क तार$ख/Date of Hearing : 17.05.2023 उदघोषणा क तार$ख/Date of Pronouncement : 19.05.2023 आदेश/Order Per A.D. Jain, Vice President: This is assessee’s appeal against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, dated 10.08.2022, for the Assessment Year 2008-09 taking the following grounds of appeal: 1. That on the facts, circumstances and legal position of the case, the Worthy CIT (A), Chandigarh in Appeal No. 1/10771/2019-20 dated 10.08.2022 has erred in passing that order in contravention of the provisions of S. 250 of the Income Tax Act, 1961. 2. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) has erred in confirming the addition of Rs. 13,20,000/-made by 631-Chd-2022 – Sh. Harjinder Singh, Kurukshetra 2 Ld. AO u/s 143(3) r.w.s. 147 of the Act by erroneously holding on account of capital introduced by the appellant in firm VRRH by alleging the same to be from unexplained source. 3. That on the facts, circumstances and legal position of the case, the impugned assessment order passed u/s 147 deserves to be quashed since the re-opening of the case u/s 148 is illegal and void-ab-initio. 4. That on law, facts and circumstances of the case, the impugned order passed by Worthy CIT(A) deserves to be quashed since he has erred in passing the order ex-parte by noting that the appellant did not file any reply or adjournment in proceedings even when the appellant had e-filed all applications on the portal and the same are visible even as on date. 2. Briefly, the facts are that in this case original assessment was made u/s 143(3) of the Income Tax Act, 1961 (hereinafter called 'the Act') at an income of Rs. 14,72,000/- which comprised of addition of Rs. 13,20,000/- made on account of unexplained capital introduced in the capital account with M/s VRRH. On being asked to explain the sources of introduction of capital of Rs. 13,20,000/- in his capital account with the firm M/s VRRH, the Assessee submitted details which have been incorporated in the order of the AO. However, the AO was not satisfied with the details furnished and found that the Assessee has declared meager income and thus held that the Assessee had no sufficient money for investment. The AO further found that 631-Chd-2022 – Sh. Harjinder Singh, Kurukshetra 3 the Assessee had not furnished any evidence regarding having received gifts from relatives and thus treated the income of Assessee earned from undisclosed sources and added the same to his income. In appeal before the ld. CIT(A), the ld. CIT(A), sustained the addition so made by the AO by passing an ex-parte order observing that several opportunities were provided to Assessee to represent its case, but the Assessee failed to appear before him. 3. It has been submitted by the ld. Counsel for the Assessee that the foremost grievance of the Assessee is that the ld. CIT(A) has concluded the proceedings without proper perusal of the assessment record by passing an ex-parte order dated 10.08.2022 u/s 250 of the Income Tax Act, 1961 (hereinafter called 'the Act') and also without considering the e-filed reply and the applications for adjournment submitted on the portal, which are visible even as on date. It has been further submitted that the Assessee has a strong case in his favour. The ld. Counsel for the Assessee prayed that keeping in view the principles of natural justice, the Assessee may be given a reasonable opportunity of hearing of the appeal before the ld. Commissioner and the appeal may be directed to be decided on merits. 4. The ld. DR, on the other hand, has placed reliance on the orders of the authorities below. 631-Chd-2022 – Sh. Harjinder Singh, Kurukshetra 4 5. Heard. We have gone through the order of the ld. CIT(A) and find that the appeal of the Assessee has been dismissed by passing an ex-parte order, merely on the basis of the non-prosecution. We find that the ld. CIT(A) has dismissed the appeal without considering the material available on record, as also without going into the merits of the case. As such, an opportunity of hearing requires to be given to the assessee to represent his case fully before the Ld. PCIT. Even otherwise, it is trite [‘S. Velu Palandar Vs. DCIT’ 83 ITR 683 (Mad.)] and incumbent on the authority to decide an appeal on merit. 6. In view of the above, finding force in the grievance raised by the Assessee, in the interest of justice, the matter is remitted to the file of the ld. CIT(A), to be decided afresh on merit, in accordance with law, on affording due and adequate opportunity of hearing to the assessee. The assessee, no doubt, shall cooperate in the fresh proceedings before the ld. CIT(A). All pleas available under the law shall remain so available to the assessee. Ordered accordingly. 7. In the result, for statistical purposes, the appeal is treated as allowed. Order pronounced on 19.05.2023. Sd/- Sd/- (VIKRAM SINGH YADAV) ( A.D. JAIN ) Accountant Member Vice President Dated : 19.05.2023 “आर.के.” 631-Chd-2022 – Sh. Harjinder Singh, Kurukshetra 5 आदेश क त*ल+प अ,े+षत / Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकर आय ु 1त/ CIT 4. +वभागीय त न5ध, आयकर अपील$य आ5धकरण, च7डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड फाईल/ Guard File आदेशान ु सार/ By order, सहायक पंजीकार/ Assistant Registrar