LAXMI BHATTER,KOLKATA V. DCIT, CC 2(1), KOLKATA

ITSSA 52/KOL/2025

AI Insights

Laxmi Bhatter filed an appeal against the order of the Commissioner of Income Tax (Appeals), Kolkata, which had dismissed her earlier appeal concerning an assessment order that added unexplained cash and jewellery to her income for the assessment year 2019-2020. The original assessment was based on a search and seizure operation that uncovered substantial unaccounted cash and jewellery in a locker belonging to the assessee. The Tribunal noted that the assessee's representative had not appeared at the appellate stage, and no evidence was provided to substantiate the claims of the assessee. The Tribunal upheld the lower authorities' decisions, emphasizing the assessee's non-compliance and failure to discharge the burden of proof regarding the sources of the seized assets.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708227 (ITAT-KOLKATA)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 17-07-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2019-2020
• Other Referred Cases: Kalyani Medical Stores Vs. Commissioner of Income Tax
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P.N. BARNWAL
• Keywords: Condonation of delay; Opportunity of being heard; Principle of natural justice; Search and seizure
• Section: 144; 143(3); 142(1); 234B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH KOLKATA BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RAKESH MISHRA, ACCOUNTANT MEMBER IT(SS) A. No.52/KOL/2025 Assessment Year: 2019-2020 Laxmi Bhatter, 27/1, Rabindra Sarani, Kolkata - 700073 (PAN: ATOPR3600G) Vs DCIT, CC2(1), Aayakar Bhawan, Poorva, Kolkata - 700107 (Appellant) (Respondent) Present for: Appellant by : None Respondent by : P.N. Barnwal, CIT-DR Date of Hearing : 17.06.2025 Date of Pronouncement : 17.07.2025 O R D E R PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the Assessee is against the order of the Ld. Commissioner of Income Tax (Appeals), Kolkata – 26 (hereinafter referred to as “the Ld. CIT(A)”) passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2019-2020 dated 11.02.2025, which has been passed against the assessment order u/s 144 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) dated 17.03.2021. 1.1 The registry has informed that the appeal is delayed by 13 days. It is observed that along with the memo of appeal, the assessee has also filed an affidavit seeking condonation of delay and has requested that the delay may be condoned, the contents of which are as under: 2 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 “AFFIDAVIT I, Laxmi Bhatter, daughter of Raj Kumar Bhatter, aged about 44 years, by religion Hindu, by occupation business, residing at 27/1, Rabindra Sarani, Kolkata 700073 do hereby solemnly affirm and state as follows: 1. That the Ld. CIT(A)-26, Kolkata has passed the appellate order for the A.Y. 2019-20 on 11.02.2025. 60 days thereafter elapsed on 12.04.2025, so the due date for presenting the appeal has expired by 31 days. The appeal has been filed on 13.05.2025, thereby 31 days of delay. 2. That my Authorised Representative (AR), Mr. Amit Lahoti, Chartered Accountant had filed the appeal before the Hon'ble Commissioner of Income Tax (Appeals)-26, Kolkata. However, he did not appear before the said authority during the course of appellate proceedings. 3. That the said AR also failed to inform me that an appellate order had been passed by the CIT(A)-26, Kolkata on 11.02.2025. 4. That since I did not receive any update or communication from my AR, I approached Sri Jaydeep Chakraborty, Advocate, in the first week of May 2025, to seek advice and assistance in the matter. 5. That Sri Jaydeep Chakraborty, Advocate, upon examining the case, advised me to file the appeal before the Hon'ble Income Tax Appellate Tribunal immediately. 6. That upon my request, Sri Jaydeep Chakraborty, Advocate, prepared the appeal in the second week of May 2025, which is being filed on 13.05.2025 before the Hon'ble Income Tax Appellate Tribunal, Kolkata. 7. That the delay, if any, in filing the appeal is not deliberate or intentional but occurred solely due to the non-communication by my previous AR, which was beyond my control. 4. Under the abovementioned facts and circumstances your goodself is requested to condone the said delay and to hear the appeal on merits to meet at the end of justice. The above informations are true to best of my knowledge and belief.” 2. Considering the affidavit filed seeking condonation of delay and the reasons stated therein, we are satisfied that the assessee had a reasonable and sufficient cause and was prevented from filing the instant appeal within the statutory time limit. We, therefore, condone the delay and admit the appeal for adjudication on merit. 3. The grounds of appeal raised by the Assessee are reproduced as under: “1. For that on the facts and in the circumstances of the case and in law the Hon'ble C.I.T.(A) erred in passing an ex parte order without appreciating that the non- appearance of the assessee's Authorised Representative was due to circumstances beyond the assessee's control and without affording a proper and effective opportunity of being heard is completely arbitrary, unjustified and illegal. 3 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 2. For that on the facts and in the circumstances of the case and in law the Ld. CIT(A) failed to adjudicate the case on merits and did not consider the relevant facts, evidences and explanations which the assessee was prevented from submitting due to the negligence of the AR, thereby violating the principles of natural justice. 3. For that on the facts and in the circumstances of the case and in law the Ld. Assessing Officer erred in law in framing the assessment u/s 143(3) of the Income Tax Act, 1961 without validly issuing a notice u/s 143(2) of the Income Tax Act, 1961 after the case was transferred to him, which is mandatory and jurisdictional in nature, rendering the entire assessment order void ab initio. 4. For that on the facts and in the circumstances of the case and in law the Hon'ble C.I.T.(A) erred in confirming the addition made by the Ld. Assessing Officer amounting to Rs. 20,69,111/- as unexplained jewellery u/s 69A r.w.s. 115BBE of the Income Tax Act, 1961 without appreciating the fact that the jewellery was duly explained and belonged to the family and consistent with disclosed sources. 5. For that on the facts and in the circumstances of the case and in law the Hon'ble C.I.T.(A) erred in confirming the addition made by the Ld. Assessing Officer amounting to Rs. 55,97,000/- as unexplained cash u/s 69A r.w.s. 115BBE of the Income Tax Act, 1961 without appreciating the fact that the cash was duly explained and belonged to the family and consistent with disclosed sources. 6. For that on the facts and in the circumstances of the case and in law the Ld. Assessing Officer and the Ld. CIT(A) failed to appreciate that the entire assessment proceeding was vitiated by procedural irregularities and lack of natural justice, as the appellant was denied any effective opportunity to explain her position due to the gross misconduct and non-responsiveness of the AR, who neither represented the case before the Assessing Officer nor before the C.I.T. (A), and even failed to communicate the appellate order to the appellant in a timely manner. 7. For that on the facts and in the circumstances of the case and in law the imposition of interest amounting to Rs. 14,33,064/- u/s 234B of the Income Tax Act, 1961 and Rs. 1,79,133/- u/s 234A of the Income Tax Act, 1961, is wholly arbitrary, devoid of merit, and contrary to the principles of natural justice. It is submitted that such interest has been levied without proper appreciation of the factual matrix and legal provisions, rendering the action unsustainable in law and liable to be quashed. 8. For that on the facts and in the circumstances of the case and in law the appellant reserves the right to adduce any further ground or grounds, if necessary, at or before the hearing of the appeal.” 4. Brief facts of the case are that the assessee is an individual who had filed her return of income on 12.11.2019 for the AY 2019-20 declaring total income at Rs. 10,15,540/- which was computed under the normal provisions of the Act. The return was processed and an intimation under section 143(1) of the Act dated 30/11/2019, was issued accepting the returned income. A search and seizure operation u/s 132(1) of the IT Act, 1961 was conducted on 28-01-2019 by the DIT, Kolkata in the premises at the basement of Vardhan Market at 25A, Camac Street, Kolkata 700 071 in the name of \"Shree Vardhan Safe Deposit Vaults Pvt. Ltd.\" Locker No. L 1997 belonging to the assessee was further searched and the contents were 4 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 seized on 16-03-2019. During the said search operation, jewellery amounting to Rs. 20,69,111/- and Cash amounting to Rs. 55,97,000/- were found. Notices u/s 143(2) dated 20-02-2020 and u/s 142(1) dated 04- 02-2021 over issued to the assessee through ITBA. Furthermore, a show cause notice dated 01-03-2021 was also issued through ITВА. An order u/s 144 of the Act was passed on 17-03-2021 determining the total income at Rs. 87,76,555/-. The Ld. AO added the value of Cash and Jewellery amounting to Rs. 76,66,111/- by treating the same as Unexplained Cash/Jewellery u/s 69A of the IT Act, 1961 r.w.s. 115BBE of the Act. Aggrieved with the assessment order, the assessee preferred an appeal before the Ld. CIT(A), who, vide order dated 11.02.2025, dismissed the appeal as despite several opportunities being granted for being heard via emails issued, the assessee did not file any details for the relief claimed and neither any response nor any request for adjournment was filed. The Ld. CIT(A) inferred that the assessee was not interested in availing the opportunity provided and was not interested in pursuing the appeal and relying upon several judicial pronouncements and section 114 of the Indian Evidence Act, the appeal was dismissed as even on merits of the case, the Ld. CIT(A) did not find any reason to differ with the findings of the Ld. AO. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal. 5. None appeared on behalf of the assessee; therefore, the appeal was heard with the assistance of the Ld. DR. It was submitted by the Ld. DR that although the assessee is pleading lack of natural justice but the facts of the case are that the opportunities provided were not availed by the assessee. It was submitted that a search and seizure action was carried out against Shree Vardhan Safe Deposit Vaults Pvt. Ltd and in the locker of the assessee, cash and jewellery were found and the assessee could not explain the source thereof, therefore, the Ld. AO made the addition. As no compliance was made before the Ld. CIT(A), the addition was confirmed. 5 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 He requested that the order of the Ld. CIT(A) may be confirmed as even now no submission has been made in respect of the reliefs claimed. 6. We have heard the submissions made and also gone through the orders of the lower authorities. The Ld. AO made the addition by observing as under: “6.2 As apparent from the facts briefed supra, However, even after providing opportunity the assessee did not complied in any means. There is nothing any corroborative which has been received in this office substantiating her claim with regards to the source of valuables and cash found kept in the locker. Taking cognizance of her statement during the search proceedings/Locker operation as discussed supra as well as non-compliance to the notices which clearly implies that she doesn't have any sort of documents to establish the source of cash so found in the locker no. L-1997 and the jewellery so found. Since she couldn't furnish the source of such valuables & cash found kept in the locker with reasonable contention with material evidence, such valuables & cash are considered as unexplained money in the hand of Mrs. Laxmi Rathi (Maheshwari). Therefore, the cash of Rs. 55,97,000/- and value of the jewellery of worth Rs. 20.69.111/-is remained unexplained and added to the total income of the assessee in the meaning of section 69A of the I.T. Act, 1961 (Unexplained money). [Addition: Rs. 55,97,000/- + Rs. 20,69,111/- Rs. 76,66,111/-]” 7. The Ld. CIT(A) confirmed the addition by holding as under: “4.4 In appeal, the appellant has not substantiated its grounds with relevant evidence(s), case laws, if any, to support the claim. Since an appeal is nothing but the claim of the appellant that he has been unduly unjustifiably penalized, it is for the appellant to prove its case. The appellant has not also availed any opportunity to do so. 4.5 The appellant in the present case has not discharged the primary onus cast upon it to substantiate its claim. The natural presumption as per Indian Evidence Act thus goes against the appellant. It is also pertinent to take note of Section 114 of the Indian Evidence Act. The presumption under the said Act flows from the words \"That evidence which could be and is not produced would, if produced be unfavourable to the person who withholds it.\" 4.6 The High Court of Calcutta in Kalyani Medical Stores Vs. Commissioner of Income Tax (80 taxmanm.com 158) (Calcutta)(2017) held as below- \"If the assessee chooses to withhold the best evidence and relies on the secondary evidence even assuming that any secondary piece of evidence was adduced then the presumption in law shall be against the assessee. 6 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 9. Reference may be made to Clause (g) of Section 114 of the Indian Evidence Act, 1872, which provides that \"The Court may presume- (g) That evidence which could be and is not produced would, if produced, be unfavourable to the person with respect to the addition who withholds it.\" 4.7 From the conduct of the appellant as per facts noted above, it is clear that the appellant does not wish to pursue the appeal. The appellant has been non-compliant in the appellate stage also. Even otherwise on the merits, I do not see any reason to differ with the findings of the AO since he has given a cogent reasoning for making the addition and no attempt has been made by the assessee to discharge its onus. The entire assessment order has been reproduced above to evidence the facts brought on record while making the addition. Hence, respectfully following the above-mentioned judicial pronouncements and in view of the facts of the case, the appeal is hereby dismissed. परिणामस्वरूप, अपील खारिज की जाती है। In the result, the appeal is dismissed” 8. Even before us, no further evidence has been filed for the relief claimed nor has anyone appeared on behalf of the assessee; hence there is no reason to interfere with the findings of the Ld. CIT(A) whose order is hereby confirmed and the appeal of the assessee is hereby dismissed. 9. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on 17th July, 2025. Sd/- Sd/- [George Mathan] [Rakesh Mishra] Judicial Member Accountant Member Dated: 17.07.2025 7 IT(SS) A.No. 52/Kol/2025 Laxmi Bhatter; AY: 2019-20 Copy to: 1. The Appellant: 2. The Respondent. 3. CIT(A) 4. The CIT, 5. DR, ITAT, Kolkata Bench, Kolkata //True Copy// By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata 1. Date of Dictation………………………………………. 2. Date on which the typed order is placed before the dictating Member and other Mem- ber…………………………………………….. 3. Date on which the order came back to Sr. PS…………………………………… 4. Date on which the file goes to the Bench Clerk………………………………… 5. Date on which the file goes to the O.S………………………………… 6. Date on dispatch of the order……………………………………… "