LATE SH SETHURAMAN THROUGH LEGAL HEIR SH S NISHAANTH ,CHENNAI V. ASSISTANT COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE 3(1), CHENNAI

ITA 2615/CHNY/2024

AI Insights

The case involves an appeal by the legal heir of the late Sh. Sethuraman against the order of the Commissioner of Income Tax (Appeals), which confirmed the additions made by the Assessing Officer under sections 69A and 69 of the Income Tax Act, 1961. The additions were based on unexplained cash deposits and investments in bonds/debentures. The Tribunal noted procedural lapses in the issuance and compliance of notices under section 148 of the Act, particularly that the legal heir was not properly served or considered in the initial assessments and appeals. Consequently, the Tribunal remanded the case for a fresh assessment, emphasizing the need for proper procedural adherence and fair opportunity for the legal heir to present his case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 107583 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R.ANITA
• Keywords: Set aside; Unexplained investment
• Section: 148; 69; 69A

Judgement Text

"आयकर अपीलीय अिधकरण, ’सी’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI ŵी एस.एस. िवʷनेũ रिव, Ɋाियक सद˟ एवं ŵी जगदीश, लेखा सद˟ क े समƗ । Before Shri S.S. Viswanethra Ravi, Judicial Member & Shri Jagadish, Accountant Member आयकर अपील सं./I.T.A. No.2615/Chny/2024 िनधाŊरण वषŊ/Assessment Year: 2015-16 Late Sh. Sethuraman through Legal heir Sh. S. Nishaanth, O 9/12, Subbarayan Street, Nungambakkam, Chennai 600 034. [PAN:ABHPS3001R] Vs. The Assistant Commissioner of Income Tax, Corporate Circle 3(1), Chennai. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : None ŮȑथŎ की ओर से/Respondent by : Ms. R. Anita, Addl. CIT सुनवाई की तारीख/ Date of hearing : 27.01.2025 घोषणा की तारीख /Date of Pronouncement : 07.02.2025 आदेश /O R D E R PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order dated 14.08.2024 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment year 2015-16. 2. We find no representation on behalf of the assessee or any application filed seeking adjournment. Thus, the assessee called absent I.T.A. No.2615/Chny/24 2 and set exparte. We proceed to decide the appeal on merits after hearing the ld. DR basing on the material available on record. 3. The assessee raised 5 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the ld. CIT(A) is justified in confirming the additions made by the Assessing Officer under section 69A and section 69 of the Income Tax Act, 1961 [“Act” in short]. 4. The Assessing Officer observed that the assessee made cash deposits amounting to ₹.14,02,880/- and no return of income filed. A notice under section 148 of the Act issued and there was no response from the assessee. Despite various notices issued, there was no response to any of the statutory notices issued by the Assessing Officer. Further, the Assessing Officer noted that from the specific information received from Andhra Bank, the assessee made cash deposits of ₹.14,02,880/- in his bank account during the financial year 2014-15. Since the source of cash deposits could not be ascertained as there was no response from the assessee, the Assessing Officer treated the same as unexplained money and added to the total income of the assessee. Further, the Assessing Officer noted that the assessee has invested ₹.50,00,000/- for acquiring bonds/debentures from National Highway Authority of India (NHAI), Delhi during the financial year 2014-15 I.T.A. No.2615/Chny/24 3 corresponding to AY 2015-16. Since the assessee could not explain the source for the above investment, the Assessing Officer treated the same as unexplained investment under section 69 of the Act and added to the total income of the assessee. On appeal, after considering the submissions of the assessee, the ld. CIT(A) confirmed the additions made by the Assessing Officer and dismissed the appeal of the assessee. 5. In this case, on perusal of the impugned order at page 4 & 5, we note that the Jurisdictional Assessing Officer issued show cause notice under section 138 of the Act. The above notice remained uncomplied with as the same was neither issued in the name of living entity nor served upon the legal heir. The legal heir of deceased assessee has filed objection to the above notice under section 148 of the Act dated 29.04.2022, but, his request was rejected on 03.05.2022 without providing any reasons. Shri S. Nishaanth (legal Heir), son of the deceased assessee was appointed as legal heir of the deceased assessee on 22.08.2023 and after appointment of legal heir, the present assessee (legal heir) preferred an appeal before the ld. CIT(A). We note that without considering the submissions of the assessee, the Assessing Officer made the additions and the ld. CIT(A) also confirmed the same, appears to be not correct. Taking into consideration the request of legal I.T.A. No.2615/Chny/24 4 heir of deceased assessee which is reflected in page 5 of the impugned order, we set aside the impugned order in confirming the additions and remand the matter to the file of the Assessing Officer to decide the issues afresh by affording reasonable opportunities to the legal heir of the deceased assessee and decide the issues in accordance with law. Thus, the grounds raised by the assessee are allowed for statistical purposes. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 07th February, 2025 at Chennai. Sd/- Sd/- (JAGADISH) ACCOUNTANT MEMBER (S.S. VISWANETHRA RAVI) JUDICIAL MEMBER Chennai, Dated, 07.02.2025 Vm/- आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3. आयकर आयुƅ/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय Ůितिनिध/DR & 5. गाडŊ फाईल/GF. "