JYOTIBA MURLIDHAR DAPKE,AURANGABAD V. ITO WARD 1(4), AURANGABAD, AURANGABAD

ITA 104/PUN/2025

AI Insights

The case involves Jyotiba Murlidhar Dapke, a farmer, who appealed against the order of the Commissioner of Income Tax (Appeals) which dismissed his appeal in limine due to non-compliance with procedural requirements under Rule 46A of the Income Tax Rules, 1962. The original assessment for the Assessment Year 2011-12 was made under section 144 of the Income Tax Act, 1961, where the assessee's non-filing of income tax return and subsequent cash deposits of Rs.11,06,305 in his bank account were treated as undisclosed income. The Tribunal noted the procedural lapses and the need for a fair hearing, leading to the decision to remand the case back to the Assessing Officer for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716986 (ITAT-PUNE)
• Duration Of Justice: 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 14-01-2025
• Other Referred Cases: Collector, Land Acquisition vs. Mst. Katiji & Ors. (1987) 167 ITR 471 (SC), Inder Singh Vs. The State of Madhya Pradesh (2025) LiveLaw (SC) 339
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAMNATH P MURKUNDE
• Assessee Lawyers: RAMESH N THETE
• Keywords: Set aside; Opportunity of being heard; Additional evidence; Reasonable cause; Reassessment proceedings; Corroborative evidences; Principle of natural justice
• Section: 147; 148; 144; 142(1)

Judgement Text

"आयकर अपीलीय अिधकरण “ए” Ɋायपीठ पुणे मŐ । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.104/PUN/2025 Assessment Year 2011-12 Jyotiba Murlidhar Dapke, Bahirgaon, Kannad, Aurangabad – 431103. PAN: BAYPD8679K Vs. The Income Tax Officer, Ward -1(4), Aurangabad. अपीलाथŎ / Appellant ŮȑथŎ / Respondent Assessee by : Shri Ramesh N Thete – AR(Virtual) Department by : Shri Ramnath P Murkunde - DR Date of hearing : 10-06-2025 Date of Pronouncement : 20-08-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the assessee is directed against the order dated 21.11.2023 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)/NFAC”] pertaining to Assessment Year (“AY”) 2011-12. 2. The appeal is filed with a delay of 349 days. The assessee has moved an application for condonation of delay. Sworn affidavit has been filed along with the application stating therein the reasons for the delay in para 3 to 8 thereof as under :- “3. That the delay in filing the present appeal is not deliberate or intentional but occurred due to the reasons beyond my control, as detailed herein below: o I had entrusted the matter to my previous tax consultant for proper handling of my case before the Learned CIT (Appeals). However, the said consultant was facing severe financial issues and mental distress, which adversely affected his professional responsibilities. o Due to the consultant's non-communication, I was unaware that the order had been passed, nor was I informed of the dismissal of my appeal by the Learned CIT (Appeals). o It was only recently, upon engaging a new Chartered Accountant, that I was informed about the adverse order and the need to file an Printed from counselvise.com 2 ITA No.104/PUN/2025 appeal before this Hon'ble Tribunal. The New CA browsed my Income Tax Details on the portal and came to know about the appeal status and informed me. 4. That, as a layman educated Graduated in Marathi Medium, living in a small village since 2007, and presently unemployed, but working as a farmer (presently cultivating family inherited agricultural lands), I lack the knowledge and expertise to comprehend income tax proceedings and have entirely relied on professional guidance for handling my tax matters. 5. That upon learning about the necessity of filing the appeal. I immediately contacted the previous consultant, who referred the matter to my present Advocate, Adv. Ramesh N. Thete, for preparation and filing of the appeal and paid filing fees and challan out of his own pocket. 6. That the delay in filing the appeal is attributable solely to the circumstances explained above and not due to any deliberate act or omission on my part. 7. That I humbly submit that justice would be served by condoning the delay in filing the present appeal, as the matter pertains to cash deposits treated as escaped income, despite the same being receipts from the sale of agricultural produce, which I had duly explained with supporting evidence. 8. That I assure this Hon'ble Tribunal of my utmost sincerity and commitment to comply with all further proceedings and respectfully pray for condonation of the delay in the interest of justice.” 2.1 The Ld. AR submitted that the delay is not intentional and is a bonafide one for the reasons beyond the control of the assessee as evident from the affidavit filed in support thereof and therefore prayed that the delay may be condoned and the appeal be admitted for adjudication. The Ld. DR, on the other hand, strongly opposed the arguments advanced by the Ld. AR. 2.2 After hearing both the sides, we find some merit in the submission of the Ld. Counsel for the assessee that there was a reasonable cause in not filing the appeal before the Tribunal within the stipulated time. 2.3 We find the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. (1987) 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As Printed from counselvise.com 3 ITA No.104/PUN/2025 against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. 2.4 We find recently the Hon'ble Supreme Court in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339 has held as under: “14. There can be no quarrel on the settled principle of law that delay cannot be condoned without sufficient cause, but a major aspect which has to be kept in mind is that, if in a particular case, the merits have to be examined, it should not be scuttled merely on the basis of limitation.” 2.5 Considering the totality of facts and in the circumstances of the case set out above and respectfully following the above decision(s) of the Hon'ble Supreme Court, we hereby condone the delay in filing of the appeal and admit the same for adjudication. 3. It is a case of assessment framed u/s 144 of the Income Tax Act, 1961 (the “Act”). The assessee is a non-filer and did not file his return of income for the relevant AY 2011-12. The case of the assessee was reopened for scrutiny for the relevant AY 2011-12 for the reason that the assessee had deposited cash of Rs.11,06,305/- in his saving bank account of SBI no. 30735210056. Notice u/s 148 of the Act was issued on 20.03.2018 which was duly served upon the assessee. Thereafter, statutory notice(s) u/s 142(1) along with questionnaire were issued and served upon the assessee from time to time. For lack of compliance in response to the said notice(s) as also to the show cause letter, the Ld. Assessing Officer (“AO”) added the entire amount of Rs.11,06,305/- to the income of the assessee as income received from undisclosed sources and completed the assessment ex-parte on total income of Rs.5,36,170/- on 14.12.2018 u/s 144 r.w.s. 147 of the Act. 4. The assessee challenged the ex-parte order before the Ld. CIT(A)/NFAC. Though the appeal was filed late by more than three years, the Ld. CIT(A)/NFAC condoned the delay and by applying the provisions of Rule 46A of Printed from counselvise.com 4 ITA No.104/PUN/2025 the Income Tax Rules, 1962 (“IT Rules”) with the support of various judicial precedents cited therein, dismissed the appeal of the assessee in limine by observing as under : “….it can be observed from above that the notices issued u/s 148/142(1) and the show cause were duly served on the Appelant and yet he failed to respond. In case the Appellant had lost relevnat details, as is being claimed, atleat this fact could have been brought to the knowledge of the AO. However, there was complete silence on the part of the Appellant. These facts do not lend credibilty to the claim being made by the Appellant that details were lost. Be that as it may, the facts remain that the details which are being submitted in the course of present proceedings were never submitetd in the course of assessment proceedings. Thus, upon a perusal of the relevant details in the backdrop of the assessment order, it is clear that these documents/evidences are indeed in the nature of an Additional Evidence. However, there is no accompanying petition of the Appellant under Rule 46A of the IT Rules, 1962. In this regard, it would be imperative to refer to the provisions contained in rule 46A of the Income Tax Rules, 1962 which is being reproduced as under \"Rule 46A.- (1) The Appellant shall not be entitled to produce before the [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)], any evidence, whether oral or documentary, other than the evidence produced by him during the course of proceedings before the [Assessing Officer], except in the following circumstances, namely:- 1. where the [Assessing Officer) has refused to admit evidence which ought to have been admitted; or 1. where the Appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by the [Assessing Officer];or (c) where the Appellant was prevented by sufficient cause from producing before the [Assessing Officer) any evidence which is relevant to any ground of appeal; or 1. where the [Assessing Officer] has made the order appealed against without giving sufficient opportunity to the Appellant to adduce evidence relevant to any ground of appeal. (2) No evidence shall be admitted under sub-rule (1) unless the [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] records in writing the reasons for its admission. (3) The [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] shall not take into account any evidence produced under sub-rule (1) unless the [Assessing Officer] has been allowed a reasonable opportunity- 1. to examine the evidence or document or to cross-examine the witness produced by the Appellant, or 1. to produce any evidence or document or any witness in rebuttal of the additional evidence produced by the Appellant. (4) Nothing contained in this rule shall affect the power of the [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] to direct the production of any document, or the examination of any witness, to enable him to dispose of the appeal, or for any other substantial cause including the enhancement of the assessment or penalty (whether on his own motion or on the request of the [Assessing Officer]) Printed from counselvise.com 5 ITA No.104/PUN/2025 under clause (a) of sub-section (1) of section 251 or the imposition of penalty under section 271.\" A perusal of the above provisions of Rule 46A would reveal that Rule 46A(1) is negatively worded and precludes an appellant from filing any evidence in the nature of an additional evidence, other than those which have been filed before an AO, except in the circumstances laid out in Rule 46A(1) Thus, it is clear that before the first Appellate Authority an Appellant can rely on the evidence filed before the AO and incase an Appellant so chooses to furnish any evidence other than the ones filed by him before the AO, then in that situation the Appellant must make out a case as falling under any of the four limbs of rule 46A(1) It therefore emerges that without stating a case under Rule 46A(1), an appellant cannot file additional evidence. A natural corollary of the same is that in the absence of any case made out by an Appellant under Rule 46A(1), the first Appellate Authority cannot consider the additional evidence filed before him. In this regard, it would be pertinent to refer to the ratio of the following judgments. In the case of CIT vs. Manish Build Well Pvt. Ltd. [ITA no.928/2011 dated 15/11/2011], it was held/averred, as follows, by the Hon'ble Delhi High Court \"23. It is for the aforesaid reason that Rule 46A starts in a negative manner by saying that an appellant before the CIT (A) shall not be entitled to produce before him any evidence, whether oral or documentary, other than the evidence adduced by him before the assessing officer. After making such a general statement, which is in consonance with the principle stated in the above judgment, exceptions have been carved out that in certain circumstances it would be open to the CIT (A) to admit additional evidence. Therefore, additional evidence can be produced at the first appellate stage when conditions stipulate in the Rule 46A are satisfied and a finding is recorded. …………………. We are highlighting these aspects only to press home the point that the conditions prescribed in Rule 46A must be shown to exist before additional evidence is admitted and every procedural requirement mentioned in the Rule has to be strictly complied with so that the Rule is meaningfully exercised and not exercised in a routine or cursory manner. A distinction should be recognized and maintained between a case where the assessee invokes Rule 46A to adduce additional evidence before the CIT (A) and a case where the CIT (A), without being prompted by the assessee, while dealing with the appeal, considers it fit to cause or make a further enquiry by virtue of the powers vested in him under sub-Section (4) of Section 250. It is only when he exercises his statutory suo moto power under the above sub-section that the requirements of Rule 46A need not be followed. On the other hand, whenever the assessee who is in appeal before him invokes Rule 46A, it is incumbent upon the CIT (A) to comply with the requirements of the Rule strictly.\" In the case of ITO vs. Bajoria Foundation [254 ITR 065 (Cal), Para 6), it was held/averred, as follows, by the Hon'ble Calcutta High Court \"It is trite that rules have to be framed within the scope of main, provision and that a rule, which travels beyond or is inconsistent with or is repugnant to the provisions in the statute will be ultra vires and void. Rule 46A was introduced with effect from 1-4-1973 and as a result of insertion of Section 295(2)(mm) in the income tax act which empowered Board to provide for the circumstances in which, the condition subject to which and the manner in which Commissioner (Appeals) may permit an Appellant to produce an evidence which the Appellant did not produce or was not allowed to produce before the assessing officer. However, these powers of the Board, which have been vested in them for carrying out for the purposes of the Act, have to be exercised in such a judicious manner so as not to make any statutory provision redundant and nugatory. Printed from counselvise.com 6 ITA No.104/PUN/2025 In the case of DCIT vs. Gurdaspur Central Co-op. Bank Ltd (ITA No. 99 (Asr.) of 2011 dated 07/05/2012), it was held/averred, as follows, by the Hon'ble ITAT Amritsar \"9.1 As per Rule 46A(2), no evidence can be admitted by the Id. CIT(A) under sub-rule (1) unless he records in writing the reasons for its admission. Under Rule 46A(3), it is clearly mentioned that the Ld. CIT(A) shall not take into account any evidence produced under sub-rule (1) unless the Assessing Officer has been allowed a reasonable opportunity to examine the evidence or document or to cross-examine the witness produced by the appellant, or to produce any evidence or document or any witness in rebuttal of the additional evidence produced by the appellant. As regards Rule 46A(4), it has also been mentioned that nothing contained in this rule shall affect the power of the CIT(A) to direct the production of any document to enable to dispose of the appeal, or for any other substantial cause including the enhancement of the assessment or penalty, whether on his own motion or on the request of the AO. In the present case, the assessee had submitted the details with regard to hiring charges, petrol charges and other charges before the Id. CIT(A) and other evidences to show that the claim of Rs.12,00,000/- is available to the assessee. In the present case, the assessee has not moved any application for admission of any additional evidence under Rule 46A of the Income Tax Rules, 1962. Even if the application under Rule 46A has not been filed before the Id. CIT(A), the assessee has not shown that the AO has refused to admit the evidence which ought to have been admitted or the assessee was prevented by sufficient cause from producing the evidence which he was called upon to produce by the AO; or where the assessee was prevented by sufficient cause from producing before the AO any evidence which is relevant to any ground of appeal; or where the AO has made the order appealed against without giving sufficient opportunity to the assessee to adduce evidence relevant to any ground of appeal. 9.2 The Ld. CIT(A), without application under Rule 46A and without recording any reason for admitting the documents and explanation filed before him and without affording reasonable opportunity to examine such evidence or documents filed before him by the AO had decided the issue in favour of the assessee, which is clear violation of principle of natural justice. It is not a case under Rule 46A(4) that the Id. CIT(A) had directed the assessee for production of any document to enable him to dispose of the appeal. Therefore, the decision of the Id. CIT(A) is in clear violation of principle of natural justice and bad in law. But in the interest of justice, since the details submitted by the Id. CIT(A) remained to be examined by the AO, though the same were not submitted before the AO inspite of number of opportunities given. Therefore, the issues involved in ground Nos. 1 & 2 are set aside to the file of the AO who will decide the issue denovo but by providing opportunity of being heard to the assessee and after considering the documents submitted before the Ld. CIT(A). Accordingly, the appeal of the Revenue is allowed for statistical purposes.\" Respectfully following the ratio of the above judgments and in view of the fact that the Appellant has furnished the additional evidence without any accompanying petition making out a case under any of the four limbs of the Rule 46A(1) of the Income Tax Rules, 1962, 1, being constrained by the procedural rules and law laid out, cannot consider the additional evidence. Thus, in the absence of the requisite documentary evidences, the contention of the Appellant remained unverified and unproved solely due to the conduct and latches on the part of the Appellant and these cannot be accepted. Accordingly, the addition made by the AO is hereby confirmed and the appeal is dismissed, in limine.” 5. Dissatisfied, the assessee is in appeal before the Tribunal raising the following grounds of appeal:- Printed from counselvise.com 7 ITA No.104/PUN/2025 “1. Considering the facts of the case and the law, the Ld. Assessing Officer is not justified to treat the cash deposits as income escaped in the hands of the Assessee, as the said cash deposits in the bank account of the assessee were receipts from sales of agricultural produce/activities of the assessee. The Ld. Commissioner of Income Tax (Appeals) has not considered the evidences submitted by the Appellant, citing the provisions of Rule 46A and dismissed the Appeal without considering the merits of the appeal before his office. The appellant is living in a small village and working as farmer i.e. cultivating his inherited agricultural lands. The action of the Ld. Commissioner of Income Tax Appeal is not justified, as the Appellant has had reasons beyond his controls to produce the evidences before the Ld. Assessing Officer. The Ld. Commissioner of Income Tax Appeal has passed the order against the very spirit of law, without paying any consideration to the fact on record and upheld the addition on technical considerations only. 2. The assessee craves to add, delete, alter, modify, withdraw any of the grounds before or at the time of hearing of the appeal.” 6. The Ld. AR submitted that the assessee is a farmer and all the cash deposits were made out of receipts from the sale of agricultural produce/activities which has been explained and supported by evidence such as copy of receipts/ bills for agricultural products sold during the relevant AY as well by filing bank statement of the Bank in which the alleged cash was deposited. He submitted that the Ld. CIT(A)/ NFAC ought to have considered the submissions of the assessee, however, he dismissed the appeal for non- production/ non-verification of the requisite supporting documentary evidence in support of his claim applying the provisions of Rule 46A of the IT Rules. He submitted that the assessee has a strong case on merits and given an opportunity the assessee is in a position to substantiate and explain his case by filing the all requisite details/ documentary evidence before the Ld. CIT(A)/NFAC or AO to their satisfaction. He, therefore, prayed that in the interest of justice, the matter may be restored to the file of the Ld. CIT(A)/NFAC/AO as deemed fit by the Bench for adjudication afresh on merits after affording an opportunity of hearing to the assessee. Printed from counselvise.com 8 ITA No.104/PUN/2025 7. The Ld. DR supported the order of the Ld. CIT(A)/ NFAC. He, however, had no objection if the matter is set aside to the file of the Ld. CIT(A)/ NFAC or AO for fresh decision on merits. 8. We have heard Ld. Representatives of the parties and perused the records as well as the paper book filed by the Ld. AR on behalf of the assessee. We find that despite service(s) of notice of hearing issued during the reassessment proceedings there was non-compliance which resulted in ex- parte decision by the Ld. AO. The Ld. CIT(A)/NFAC dismissed the appeal of the assessee in limine without considering the additional evidence filed by the assessee for the reason that the same were never produced by the assessee before the Ld. AO at the assessment stage which are detailed in the preceding paragraph. The case of the assessee was reopened for the reason that the assessee had deposited cash of Rs.11,06,305/- in his saving bank account of SBI. Before the Ld. CIT(A) as well the Tribunal, the assessee has contended that the cash deposits were made out of receipts from the sale of agricultural produce/ activities. The said contention of the assessee has been corroborated by submission of documentary evidence in the form of cop(ies) of receipts/ bills for agricultural products sold during the relevant AY as well by bank statement of SBI where the cash has been deposited (pages 1 to 31 of the Paper book refers). This supporting evidence adduced by the assessee requires verification. As submitted by the Ld. Counsel the assessee is a small farmer and lacked technical expertise in maintaining and keeping the requisite records due to which the supporting evidence could not be filed before the Ld. AO. It is also his submission that given an opportunity the assessee is in a position to substantiate and explain his case by filing the all requisite details/ documentary evidence before the lower authorities and therefore urged that the matter may be sent back to the Ld. CIT(A)/NFAC/AO for adjudication afresh on merits. Printed from counselvise.com 9 ITA No.104/PUN/2025 9. On the facts and in the circumstances of the case enumerated above, we are of the opinion that in the interest of justice and fair play the matter deserves to be sent back to the file of the Ld. AO for adjudicating the assessee’s appeal before him for the relevant AY under consideration afresh on merits as per fact and law in light of the submissions/ documentary evidence already available on record and such other documentary evidence as may be called upon and/ or further submitted by the assessee during the course of fresh proceedings. Needless to say, the assessee shall co-operate fully during the fresh assessment proceedings in terms of submitting the relevant documents/ evidence as may be required/called upon on the appointed date and make his submissions without seeking any adjournment under any pretext, failing which the Ld. AO shall be at liberty to pass appropriate order as per law. Accordingly, we set aside the impugned order of the Ld.CIT(A)/NFAC and direct the Ld. AO to decide the matter de-novo on merits after allowing opportunity of hearing to the assessee. We direct and order accordingly. 10. In the result, the appeal of the assessee for AY 2011-12 is allowed for statistical purposes. Order pronounced in the open court on 20th August, 2025. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; िदनांक / Dated : 20th August, 2025./SGR* आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant. 2. ŮȑथŎ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, “ए” बŐच, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाडŊ फ़ाइल / Guard File. Printed from counselvise.com 10 ITA No.104/PUN/2025 आदेशानुसार / BY ORDER, / / True Copy / / वįरʿ िनजी सिचव / Sr. Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Printed from counselvise.com "