MALKARI MAHESWARI BAI, KURNOOL V. ITO., WARD-2, KURNOOL

ITA 566/HYD/2025

AI Insights

The case involves Malkari Maheswari Bai, the appellant, who filed an appeal against the order of the CIT(A) - National Faceless Appeal Centre, Delhi, concerning the assessment year 2017-2018. The appellant, a firm, had filed a return declaring a total income of Rs.4,74,830. The case was selected for scrutiny, and due to non-submission of details by the assessee, the Assessing Officer made a best judgment assessment under section 144 of the Income Tax Act, 1961, significantly increasing the assessed income. The CIT(A) upheld this assessment after the appellant failed to appear or provide details during multiple hearings. The appellant contested that they did not receive proper notice for these hearings, leading to the current appeal before the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711251 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURPREET SINGH
• Assessee Lawyers: K A SAI PRASAD
• Section: 144; 142(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “A” BENCH: HYDERABAD BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MANJUNATHA G, ACCOUNTANT MEMBER ITA.No.566/Hyd./2025 Assessment Year 2017-2018 Malkari Maheswari Bai KURNOOL – 518 002 PAN AOBPB5251K vs. The Income Tax Officer, Ward-2, KURNOOL – 518 001. (Appellant) (Respondent) For Assessee : CA, KA Sai Prasad And CA, P V Raghavendra Kumar For Revenue : Sri Gurpreet Singh, Sr. AR Date of Hearing : 23.07.2025 Date of Pronouncement : 25.07.2025 ORDER PER MANJUNATHA G. : The above appeal has been filed by the Assessee against the Order dated 09.01.2025 of the learned CIT(A)- National Faceless Appeal Centre [in short “NFAC], Delhi, relating to the assessment year 2017-2018. 2. Brief facts of the case are that, the assessee, is a Firm, filed return of income for the assessment year 2017- 2018 on 19.09.2017, declaring total income at Printed from counselvise.com 2 ITA.No.566/Hyd./2025 Rs.4,74,830/-. The case was selected for scrutiny under CASS and notice u/sec.143(2) and 142(1) of the of the Income Tax Act, 1961, even dated has been issued along with relevant questionnaire and called-upon the assessee to file evidences. In response, the assessee has not filed any details. Therefore, the Assessing Officer issued a show cause notice as per the provisions of sec.144(1)(b) of the Act and called-upon the assessee to explain as to why the assessment shall not be completed in terms of section 144 to his best Judgment. Once again, there is no response from the assessee. Therefore, the Assessing Officer on the basis of material available on record, completed the assessment to his best Judgment in terms of sec.144 of the Act and determined the total income of Rs.1,41,73,790/- by making addition towards cash deposit during the demonetization period for Rs.42,98,500/- and addition towards cash and other credits before demonetization period for Rs.94,00,461/- and brought to tax u/sec.115BBE of the Income Tax Act, 1961. Printed from counselvise.com 3 ITA.No.566/Hyd./2025 3. Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). Before the learned CIT(A), the assessee neither appeared nor filed any details which is evident from para-4 of learned CIT(A)’s order where the case has been listed for hearing on 6 occasions right from 29.01.2021 to 12.12.2024, but, no response from the assessee. Therefore, the learned CIT(A) passed ex-pate appellate order and sustained the additions made by the Assessing Officer towards cash deposit during the demonetization period and other credits and dismissed the appeal filed by the assessee. 4. Aggrieved by the order of the learned CIT(A), the assessee is now, in appeal before the Tribunal. 5. CA, K A Sai Prasad along with CA, P V Raghavendra Kumar, referring to Form-35 filed by the assessee before the learned CIT(A) submitted that, the assessee has communicated in Form-35 at column no.17 that notice of hearing may be sent to the email ID [e-mail]. However, the learned CIT(A) has issued notices to various other emails. The said notices Printed from counselvise.com 4 ITA.No.566/Hyd./2025 issued through emails were not received by the assessee. Therefore, the assessee could not appear before the learned CIT(A) to explain it’s case. Further, the Assessing Officer has made additions towards cash deposit during the demonetization period and also other bank credits, even though, there are various other credits and refund of advances from customers and same needs to be explained to the Assessing Officer. Therefore, he submitted that, the matter may be remitted to the file of Assessing Officer to give another opportunity of hearing to the assessee to explain it’s case. 6. Sri Gurpreet Singh, learned Sr. AR for the Revenue, on the other hand, supporting the order of the learned CIT(A) submitted that, the Assessing Officer has given ample opportunities to the assessee to file relevant evidences. The learned CIT(A) had also given number of opportunities, but, the assessee failed to file any evidences. Now the assessee claims that notice issued by the learned CIT(A) to a different email address were not received by the assessee and because of this reason, the assessee could not Printed from counselvise.com 5 ITA.No.566/Hyd./2025 file any evidences, but, the fact remains that, the learned CIT(A) issued notices to the email ID given by the appellant in Form-35 column-17, which is evident in the list submitted by the assessee. Therefore, there is no merit in the arguments of the assessee and thus, the appeal filed by the assessee should be dismissed. 7. We have heard both the parties, perused the material on record and the orders of the authorities below. Admittedly, the assessment proceedings before the Assessing Officer is ex-parte, because, the assessee neither appeared nor filed any details. Therefore, the Assessing Officer passed best judgment assessment in terms of sec.144(1) of the Income Tax Act, 1961. Although, the assessee has filed appeal before the learned CIT(A), but, did not get an opportunity of hearing because, the assessee claims that, the notice issued by the learned CIT(A) were sent to a different email-ID, even though, the assessee has furnished email-ID [e-mail] in column-17 of Form-35. Since the assessee did not get an opportunity to explain it’s case before the lower authorities Printed from counselvise.com 6 ITA.No.566/Hyd./2025 and further, the assessee claims that, the Assessing Officer has made additions towards credits in the bank account which are not only cash deposit, but, also various other credits including refund of advances and this fact needs to be verified by the Assessing Officer. Therefore, we are of the considered view that, the issue needs to go back to the file of Assessing Officer for further verification. Thus, we set- aside the order of the learned CIT(A) and restore the issue back to the file of Assessing Officer and direct the Assessing Officer to reconsider the issue ‘de novo’ in accordance with law, after providing an opportunity of hearing to the assessee. Needless to say, the assessee shall furnish relevant details as and when the case is called for hearing. 8. In the result, appeal of the Assessee is allowed for statistical purposes. Order pronounced in the open Court on 25.07.2025. Sd/- Sd/- [VIJAY PAL RAO] [MANJUNATHA G] VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad, Dated 25th July, 2025 VBP Printed from counselvise.com 7 ITA.No.566/Hyd./2025 Copy to 1. Malkari Maheswari Bai, KURNOOL – 518 002. C/o. Katrapati & Associates, 1-1-298/2/B/3, Sowbhagya Avenue Apts. 1st Floor, Ashok Nagar, Street No.1, Hyderabad. Telangana. 2. The Income Tax Officer, Ward-2, Income Tax office, Opp. Childrens Park, Nr Pet Kurnool, KURNOOL – 518 001. 3. The Pr. CIT, Kurnool. 4. The DR ITAT “A” Bench, Hyderabad. 5. Guard File. //By Order// //True Copy// Printed from counselvise.com "