KAMRAN ZUBAIR,KANPUR V. THE AO CIRCLE-1(2)(1), KANPUR

ITA 84/LKW/2024

AI Insights

The case involves Kamran Zubair, the proprietor of M/s U.K. Shoppe, who appealed against the order of the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi. The appeal was related to the assessment year 2017-18, where the assessee's income was significantly increased due to undisclosed cash deposits during the demonetization period. The Assessing Officer (AO) added Rs. 27,50,000 as undisclosed income under section 69A of the Income Tax Act, 1961, which was upheld by the CIT(A). The NFAC dismissed the appeal ex-parte, leading to the current appeal before the Income Tax Appellate Tribunal, Lucknow.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 471104 (ITAT-LUCKNOW)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAURABH DUBEY
• Assessee Lawyers: ASHISH JAISWAL
• Section: 143(3); 69A; 145(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, LUCKNOW BEFORE SHRI. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA No.84/LKW/2024 Assessment Year: 2017-18 Kamran Zubair 112/349-D, Swaroop Nagar Kanpur v. The Assessing Officer Circle 1(2)(1) Kanpur TAN/PAN:AAEPZ7118E (Appellant) (Respondent) Appellant by: Shri Ashish Jaiswal, Advocate Respondent by: Shri Saurabh Dubey, D.R. Date of hearing: 12 12 2024 Date of pronouncement: 23 12 2024 O R D E R This appeal has been preferred by the assessee against the order dated 12.12.2023, passed by the ld. Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi for Assessment Year 2017-18. 2. The brief facts of the case are that the assessee was engaged in the business of trading of Shoes, Leather and Leather Scrap as a proprietor of M/s U.K. Shoppe. The assessee filed his return of income for the year under consideration on 06.11.2017, declaring a total income of Rs.15,26,110/-. Later on, the case was selected for complete scrutiny to examine the issue of cash deposits during the demonetization period. During the course of assessment proceedings, the Assessing Officer (AO) noticed that ITA No.84/LKW/2024 Page 2 of 5 the assessee had deposited cash amounting to Rs.27,50,000/- during the demonetization period. Since the AO was not satisfied with the explanations furnished by the assessee with regard to the aforesaid cash deposits, he treated the cash deposits of Rs.27,50,000/- as undisclosed income of the assessee and added the same to the total income of the assessee under section 69A of the Income Tax Act, 1961 (hereinafter called “the Act’). The AO accordingly completed the assessment under section 143(3) of the Act at a total income of Rs.42,76,110/-. 3. The AO also invoked the provisions of section 115BBE and initiated penalty proceedings under section 271AAC of the Act. 4. Aggrieved, the assessee preferred an appeal before the NFAC. However, the appeal before the NFAC came to be dismissed by passing an order ex-parte qua the assessee. 5. Now, the assessee has approached this Tribunal challenging the dismissal of its appeal by the NFAC by raising the following grounds of appeal: 1. That the Id.AO has erred in making addition of Rs.27,50,000/- u/s 69A of the Income Tax Act, 1961on the basis of partial rejection of books of account u/s 145(3) of the Income Tax Act, 1961. ITA No.84/LKW/2024 Page 3 of 5 2. That the Id.AO as well as Id.CIT(A) has erred in confirming addition of Rs.27,50,000/- u/s 69A read with section 115BBE of the Income Tax Act, 1961. 3. That the Id.AO as well as Id.CIT(A) has erred in confirming addition of Rs.27,50,000/- u/s 69A of the IT Act, 1961 rws 115BBE of the IT Act, 1961 leading to double taxation as the cash deposit has already been considered in the return of income. 4. The the Id.CIT(A) has erred in not providing the proper and adequate opportunity of hearing to the appellant. 5. That the order passed by the Id.AO as well as Id.CIT(A) is arbitrary, prejudicial and unlawful without proper appreciation of facts and position of law. 6. That the appellant craves leave to introduce, modify or withdraw any ground of appeal with kind permission of your honour. 6. The Ld. Authorized Representative for the assessee (Ld. A.R.) submitted that there is a delay of 05 days in filing the appeal before the Tribunal. He submitted that the assessee had filed an application for condonation of delay, duly supported by an Affidavit, stating therein that the delay in filing of the appeal by 05 days was caused by delay in delivery of the appeal memo by the Postal Department. He prayed that the delay be kindly condoned. 7. The Ld. Sr. D.R. had no objection to the delay being condoned. ITA No.84/LKW/2024 Page 4 of 5 8. In view of the prayer made by the Assessee, supported by an Affidavit and no objection by the ld. D.R., I condone the delay in filing of the appeal and admit the appeal for hearing. 9. During the course of hearing before me, the Ld. Authorized Representative for the assessee (Ld. A.R.) submitted that no notice of hearing from the Office of the ld. CIT(A)/NFAC was received by the assessee and that the NFAC had decided the appeal of the assessee ex-parte qua the assessee without providing a reasonable opportunity of hearing to the assessee. The Ld. A.R. prayed that in the interest of justice, the matter may be restored to the file of the NFAC for deciding the issues in dispute on merits after providing a reasonable opportunity of hearing to the assessee. 10. Since the order passed by NFAC was an ex-parte order, the ld. Senior D.R. had no objection to the restoration of appeal to the NFAC. 11. I have heard both the parties and have also perused the material on record. It is evident that the order passed by the NFAC is an ex-parte order. Looking into the facts of this case, I am of the considered view that the assessee deserves one more opportunity to present his case and, therefore, in the interest of substantial justice, I restore this file to the Office of the NFAC with the direction to provide one more opportunity to the ITA No.84/LKW/2024 Page 5 of 5 assessee to present his case. I also caution the assessee to fully comply with the directions of the NFAC in the set-aside proceedings when called upon to do so, failing which, the NFAC shall be at complete liberty to pass the order in accordance with law, based on material available on record even if it is ex-parte qua the assessee. 12. In the result, the appeal of the assessee stands allowed for statistical purposes. Order pronounced in the open Court on 23/12/2024. Sd/- [SUDHANSHU SRIVASTAVA] JUDICIAL MEMBER DATED:23/12/2024 JJ: Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DR By order Assistant Registrar "