MUNNALAL,KAJLANA, MOLANA, BADNAGAR, UJJAIN V. ITO, UJJAIN, UJJAIN

ITA 887/IND/2024

AI Insights

The case involves an appeal by the assessee, Munnalal, against the order of the CIT(A) which confirmed the additions made by the A.O. under Section 69A of the Income Tax Act, 1961, concerning unexplained cash deposits amounting to Rs. 89,74,500 in the assessee's bank account. The assessee had not filed his return of income for the Assessment Year 2018-19, and despite multiple notices under Sections 148 and 142(1), he failed to respond, leading to an ex parte assessment order under Section 144. The Tribunal found that the assessee was not given a reasonable opportunity to present his case, as the notices were not received in physical form and the time given for compliance was insufficient, considering the assessee's background as an agriculturist not frequently using email.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 397904 (ITAT-INDORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH PORWAL
• Assessee Lawyers: GAURAV PANDYA
• Keywords: Set aside; Principle of natural justice
• Section: 147; 144; 142(1); 139

Judgement Text

" Page 1 of 8 आयकर अपीलीय अिधकरण, इंदौर Ɋायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI PARESH M JOSHI, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER ITA No.887/Ind/2024 (AY: 2018-19) Munnalal, Kajlana, Molana, Badnagar, Ujjain (PAN: DIXPM9177G) बनाम/ Vs. Income Tax Officer, Ujjain (Appellant) (Respondent) Assessee by Shri Gaurav Pandya, AR Revenue by Shri Ashish Porwal, Sr. DR Date of Hearing 04.06.2025 Date of Pronouncement 06.06.2025 आदेश / O R D E R Per Paresh M Joshi, J.M.: This is an appeal filed by the assessee Under Section 253 of the Income Tax Act, 1961 (hereinafter referred to as the “Act” for sake of brevity) before this Tribunal as and by way of second appeal. The assessee is aggrieved by the order bearing Number ITBA/NFAC/S/250/2024-25/1069646376(1) dated 14.10.2024 of Ld. CIT(A) which is hereinafter referred to as the “Impugned order”. The relevant Assessment Year is 2018-19 and the Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 2 of 8 corresponding previous year period is from 01.04.2017 to 31.03.2018. 2. FACTUAL MATRIX 2.1 That as and by way of an assessment order made u/s 147 r.w.s. 144 of the Act, the assesee’s total income was determined and computed at Rs.89,78,173/- exigible to tax. Additions were made on account of unexplained money u/s 69A of the Act to the tune of Rs.89,74,500/- which was found to have been credited in to assessee’s Axis Bank saving account. The aforesaid amount was deposited in cash. There was sale of equity share of Rs.3,673/- which too was treated as Short Term Capital Gain. 2.2 The assessee had not filed his return of income for Assessment Year 2018-19 both u/s 139 & u/s 147/148/148A of the Act. 2.3 Before passing the assessment order the Ld. A.O had issued following notice(s) u/s 148/142(1) of the Act to the assessee which are tabulated as below:- Notice Date of issue Due date compliance Remarks 148A(b) 15.03.2022 23.03.2022 No response Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 3 of 8 148 29.03.2022 20.04.2022 No response 142(1) 13.12.2022 28.12.2022 No response 142(1) 04.01.2023 12.01.2023 No response 142(1) 19.02.2023 28.02.2023 No response 142(1) 20.03.2023 22.03.2023 No response 2.4 Since the assessee was totally non responsive the Ld. Assessing Officer invoked the provisions of Section 144 and passed assessment order bearing Number ITBA/AST/S/147/2022-23/1051697318(1) dated 30.03.2023 which is hereinafter referred to as the “impugned assessment order”. 2.5 That the assessee being aggrieved by the aforesaid “impugned assessment order” prefers first appeal u/s 246A of the Act before Ld. CIT(A) who by the “impugned order” has dismissed the 1st appeal of the assessee. 2.6 That the assessee being aggrieved by the “impugned order” has preferred the instant second appeal before this Tribunal and has raised following grounds of appeal in Form No.36 against the “impugned order” which are as under:- Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 4 of 8 “1. That on the facts and in the circumstances of the case, the notice U/s. 148/142(1) and Order U/s. 147 r.w.s.144 passed in the case of the appellant are wrong and invalid. 2. That the confirmation by Ld. CIT(A), of addition U/s. 69A at Rs. 89,74,500/-on account of alleged unexplained cash deposit in bank account, is also wrong, invalid and unjustified. 3. (In the nature of submissions): That in the case of the appellant: (a) the appellant did not received reasonable/sufficient opportunity during assessment as the various notices issued by the Income Tax Officer u/s 148/142(1) was not received by him physically therefore he could not explain cash deposit source before the Ld. AO, and (b) the appellant did not received reasonable/sufficient opportunity before the Ld. CIT(A) as he got merely seventeen days from the date of issuance of fist hearing notice till the due date of compliance of last notice through email and the appellant is uneducated and is solely engaged in agricultural activities and does not use email frequently; and 4 (c) the appellant at the time of filing appeal under Form 35 duly submitted before the Ld. CIT(A), the evidences of agricultural receipts i.e., agricultural produce sale bills, crop certificate cum land holding certificate issued by government authority, copy of agricultural KCC bank account, copy of saving bank account etc. but the Ld. CIT(A) has not either seen/not properly appreciated them, and (d) as per ITBA (Income Tax Business Application) information, notice from Income Tax department showing cash deposits in one or more accounts (other than a current account and time deposit) amounting to Rs. 89,74,500/-. However the bank account of the appellant showing cash deposit of Rs. 30,89,500/- during the year in the Saving Account of Axis Bank having Account No. 917010041469976 and KCC Account of Axis Bank having Account No. 917030054192315. Further, there is no other cash deposit in any other bank account of the appellant; and 5 (e) the above cash deposit of Rs. 30,89,500/- pertains to receipts from sale of agriculture produce and milk where the amount is cited and withdrew from time to time as per the needs of the same and (f) the land holding was about 35 Bighas and around 15-20 buffalo, considering them the amount of cash deposit is reasonable and the bills for the sale of agricultural produce and milk throughout the year are also available”. Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 5 of 8 3. Record of Hearing 3.1 The hearing in the matter took place before this Tribunal on 04.06.2025 when the Ld. AR for and on behalf of the assessee appeared before us and interalia contended that the “impugned order” is bad in law, illegal and not proper. The “impugned order” is also in violation of principle of natural justice. The “impugned order” thus deserves to be set aside. The Ld. AR has placed on records of this Tribunal today a brief write up in support of his case wherein it has been urged that notice(s) issued by Ld. Assessing Officer (supra)were never received by the assessee in physical form. Further Ld. CIT(A) gave too short time of 17 days from date of issuance of first hearing notice till the date of due compliance of last notice. It was urged that assessee is an agriculturist by profession and does not use e- mail facility frequently. Details of bank statements, agriculture produce sale bills, copy of agricultural KCC bank account, crop certificate cum land holding certificate issued by government authority etc are too placed in write up given today. Per contra Ld. DR appearing for and on behalf of the revenue has submitted Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 6 of 8 that both “impugned assessment order” and so also “impugned order” are not on merits and hence in view of submissions made today by Ld. AR it would be just and fair that matter be adjudged afresh by Ld. Assessing Officer wherein all papers, documents, evidences now placed in write up given can be looked into. Finally Ld. DR has said that the “impugned order” be set aside and the matter be relegated back to the file of Ld. Assessing Officer so that correct determination of income can take place according to law. 4. Observations,findings & conclusions. 4.1 We now have to decide the legality, validity and the proprietery of the “impugned order” basis records of the case and rival contentions canvassed before us. 4.2 We have carefully perused the records of the case. 4.3 We basis records of the case so also after hearing and upon examining the contentions are of the considered opinion that the “impugned order” has given too short a time to the assessee to present his case. We notice and observe that first notice is dated 10.09.2024 and date of compliance was 17.09.2024, second notice was dated 19.09.2024 with date of compliance on Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 7 of 8 23.09.2024 and the last notice was dated 24.09.2024 with date of compliance on 27.09.2024. We on cumulative analysis of notice(s) (supra) finds that between first date of notice i.e. 10.09.2024 and last date of notice dated 24.09.2024 in all 14 days time gap is provided and for the purpose of compliances in all 10 days time period is provided from date of first compliance to last compliance date (17.09.2024 to 27.09.2024). The assessee is not tech savy person he is an agriculturist in rural area of India. The Ld. AR has successfully demonstrated that short gap of time has caused prejudice. The Ld. DR has not effectively rebutted the contentions of Ld. AR on any cogent grounds on the contrary Ld. DR has stated that matter should be relegated back to the file of Ld. A.O. In brief Ld. DR for and on behalf of revenue too desires meritorious disposal of the case. 4.4 In the premises drawn up by us as aforesaid we set aside the “impugned order” and remand the case back to the file of Ld. A.O with a direction to pass a speaking and well reasoned order on merits. We direct the assessee to place on record of Ld. A.O file of assessment all the relevant and material papers. Documents, evidences having bearing on his income and its Munnalal ITA No. 887/Ind/2024 - A.Y.2018-19 Page 8 of 8 sources and such other papers and documents like land deed, crop pattern, crop produced and mandi receipts evidencing from which sources income is derived at. The Ld. A.O would be free to examine and verify such papers and documents as he deem it in accordance with law. 5. Order 5.1 The “impugned order” is set aside as and by way of remand back to the file of Ld. A.O. 5.2 Appeal of the assessee is allowed for statistical purpose. Order pronounced in open court on 06.06.2025. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PARESH M JOSHI) ACCOUNTANT MEMBER JUDICIAL MEMBER Indore िदनांक / Dated : 06/06/2025 Dev/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order COPY Senior Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore "