SMT. SUMITRADEVI KAMALKUMAR AGRAWAL,AHMEDABAD V. .THE ITO, WARD-5(3)(2), AHMEDABAD

ITA 1309/AHD/2024

AI Insights

The case involves Smt. Sumitradevi Kamalkumar Agrawal, the appellant, contesting an order from the CIT(A) regarding an addition of Rs. 28,30,250 as unexplained investment for the Assessment Year 2016-17. The addition was based on information that the assessee had purchased a property and paid 'on money' to M/s. Navratna Organisers and Developers Pvt. Ltd. The assessee argued that the reopening of the case under section 147 and the subsequent notice under section 148 were invalid, and that no incriminating documents were found to support the addition. The CIT(A) dismissed the appeal for non-prosecution, citing the appellant's failure to respond to multiple notices. The Tribunal, however, noted the procedural error in serving notices to an incorrect email address and remanded the case for a fresh hearing.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 29563 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 03-07-2024
• Other Referred Cases: CIT vs. B.N. Bhattacharjee and Another, Estate of Late Tukojirao Holkar vs. CWT, CIT Vs. Multiplan India (P) Ltd.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NITIN VISHNU KULKARNI
• Assessee Lawyers: KETAN H. SHAH
• Keywords: Set aside; Opportunity of being heard; Unexplained investment
• Section: 147; 148; 69

Judgement Text

" आयकर अपीलीय अिधकरण, अहमदा बा द \u0012ा यपीठ ‘SMC’, अहमदा बा द । IN THE INCOME TAX APPELLATE TRIBUNAL “SMC ” BENCH, AHMEDABAD सु\u0017ी सुिच\u0019ा का \u001aले, \u0012ा ियक सद\u001c एवं \u0017ी मकरंद वसंत महा देवकर, लेखा सद\u001c क े सम\"। ] ] BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI MAKARAND V. MAHADEOKAR, ACCOUNTANT MEMBER आयकर अपील सं /ITA No.1309/Ahd/2024 िनधा \u0010रण वष\u0010 /Assessment Year : 2016-17 Smt. Sumitradevi Kamalkumar Agrawal C/o.Ketan H. Shah, Advocate 512, Times Square-1 Opp. Ram Baug Bungalow Thaltej, Shilaj Road, Thaltej Ahmedabad – 380 059 (Gujarat) बनाम/ v/s. The ITO Ward-5(3)(2) Ahmedabad \u0014थायी लेखा सं./PAN: AAUPA 5783 C अपीलाथ%/ (Appellant) &' यथ%/ (Respondent) Assessee by : Shri Ketan H. Shah, AR Revenue by : Shri Nitin Vishnu Kulkarni, Sr.DR सुनवाई की तारीख/Date of Hearing : 11/12/2024 घोषणा की तारीख /Date of Pronouncement: 12/12/2024 आदेश/O R D E R PER MAKARAND V. MAHADEOKAR, AM: This appeal filed by the Assessee is directed against the order dated 12/02/2024 passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] for the Assessment Year (AY) 2016-17 arising from the assessment order dated 25/03/2022 passed by the Assessing Officer (hereinafter referred ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 2 to as “AO”) u/s. 147 read with section 144B of the Income Tax Act, 1961 (hereinafter referred to as “the Act”). 2. The assessee has raised the following grounds of appeal: “The Lower Authority has erred on facts as well as law. 1. In assuming jurisdiction U/s 148 of the Income Tax Act by issuing notice dated 30-03-2021 for the AY 2016-17, it is said that the whole proceeding is itself bad in law and void and the reason recorded is itself vague and cryptic and therefore, the reopening is liable to be quashed. 2. It is further submitted that no incriminating documents was found from the premises of Navratna Organizers to support the reason recorded as well as in support of the Rs.28,30,250/- and therefore, the addition is required to be deleted. 3. It is further submitted that no such statement of Navratna Organization and Developer Pvt. Ltd of any director or any authorize persons have been provided and even otherwise, the cross examination has been requested which was denied and therefore, it is said that the proceeding is bad in law and void. 4. It is further submitted that in any case on merits, there is no justification to make the addition in FY 2016-17 instead of it should be in FY 2010-11 and therefore, the addition in this year is required to be deleted.” 3. At the outset, it is noted that there is a delay of 82 days on the part of the assessee in filing the appeal before the Tribunal. In this regard, the assessee has filed an Affidavit dated 11/07/2024 seeking condonation of the said delay on the grounds that no intimation of this order was received via SMS or email. The assessee also stated in the affidavit that order of CIT(A) was discovered on or around May 20, 2024, when the deponent's Chartered Accountant checked the ITBA portal and informed her and subsequently, instructions were given to file the appeal. ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 3 3.1. Keeping in view the reason given by the assessee in her application for condonation of delay, we are satisfied that there was a reasonable and sufficient cause for the delay of 82 days on the part of the assessee in filing the appeal before the Tribunal and even learned DR has not raised any material objection in this regard. We, therefore, condone the said delay and proceed to adjudicate the appeal. 4. The brief facts of the case culled out from the records are that the assessee filed her return of income on 25/06/2016 declaring total income of Rs.7,67,940/- during the year under consideration. On receipt of information from DCIT Central Circle – 1(1), Ahmedabad that the assessee has purchased villa/plot and paid on money of Rs. 56,60,500/- to M/s. Navratna Organisers and Developers Pvt. Ltd. (NODPL), the case was reopened u/s.147 of the Act, after recording the reasons and obtaining approval u/s.151 of the Act. The AO issued Notice u/s.148 of the Act, dated 30/03/2021, which was duly served upon the assessee. The assessee filed the return of income in response to notice u/s 148. The assessee declared total income of Rs. 7,67,940/- and provided details such as computation of income, balance sheet, property purchase agreements, and conveyance deeds. The assessee explained that the property (Unit No. 248 in Kalhaar Blues and Greens) was purchased on September 21, 2010, with a conveyance deed executed on March 23, 2016, for Rs. 1,11,60,500/- and the property was jointly owned by the assessee and her husband, with each holding a 50% share. The payment was made via bank loans and personal funds, with no cash payments involved. A show cause notice dated March 18, 2022, was issued to the assessee proposing an addition of Rs. 28,30,250/- as unexplained investment under Section 69 of the Act. The assessee denied any cash payments to NODPL and highlighted that no ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 4 corroborative evidence existed to prove the alleged unexplained investment. It was argued by the assessee that since the property was purchased in the financial year 2010-11, no addition should be made for the assessment year 2016-17 under review. The AO did not accept the assessee's submissions and computed the total income of the assessee at Rs.35,98,190/- after adding Rs. 28,30,250/- as unexplained investment. 4. Aggrieved the assessee, filed an appeal before the CIT(A), who passed an ex-parte order by dismissing the appeal of the assessee, by observing as under: 4. Several notices were issued giving opportunities of being heard to the appellant, which were duly served upon the appellant through registered email. No response is received till date. The particulars of notices issued are as under: Sr. No. Date of Notice Date of hearing Remarks 1. 14/08/2023 25/08/2023 Delivered on the registered e-mail address given by the appellant, but no response received. 2. 21/12/2023 28/12/2023 Delivered on the registered e-mail address given by the appellant, but no response received. 3. 29/12/2023 05/01/2024 Delivered on the registered e-mail address given by the appellant, but no response received. 4. 09/01/2024 15/01/2024 Delivered on the registered e-mail address given by the appellant, but no response received. 4.1 In view of the above, it appears that the non-appearance to notices is deliberate as all the notices have been duly served upon the appellant on the registered email account. No response has been received from the appellant till date. It is reasonable to infer from the continued non-compliance that the appellant is not serious to pursue its appeal. ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 5 4.2 Hon'ble Supreme Court in the case of CIT vs. B.N. Bhattacharjee and Another, 118 ITR 461(SC) observed that preferring an appeal means more than formally filing it but effectively prosecuting it. Hon'ble M.P. High Court in the case of Estate of Late Tukojirao Holkar vs. CWT, (1997) (223 ITR 480) (M.P.) dismissed the reference in default and for not taking necessary steps. Similar view has been taken by I.T.A.T. Delhi Bench in the case of CIT Vs. Multiplan India (P) Ltd. (1991)(38 ITD 320). Considering the above, it appears that the appellant is not interested in prosecuting its appeal. Therefore, the appeal filed by the appellant is dismissed for non-prosecution. 5. In the result, the appeal is dismissed.” 5. During the course of hearing before us, the ld.Counsel for the assessee contended that the ex-parte order passed by the Ld.CIT(A) needed to be set aside and submitted that as no incriminating documents were found from the premises of Navratna Organizers to support the reason recorded as well as in support of the addition of Rs.28,30,250/- The AR also submitted that the assessee could not reply to the notices of the CIT(A) as the notices were not received by the assessee. 5. On the other hand, the Ld.DR for the Revenue vehemently supported the orders of authorities below. 6. We have heard both parties perused the material on record, and carefully examined the orders of the lower authorities. Upon consideration of the facts and circumstances of the case, it is noted that the email address mentioned in Form 35 is [e-mail], which does not pertain to the assessee. This lends credence to the contention of the learned Authorized Representative (AR) that the assessee did not receive any notice or order from the CIT(A). Given that the issue was not adjudicated on merits, we deem it appropriate, in the interest of justice, to restore the matter to the file of the CIT(A) for a fresh decision. ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 6 6.1. However, we cannot overlook the conduct of the assessee during the appellate proceedings. The assessee’s lack of diligence has contributed to the delay in proceedings, thereby placing an undue burden on the judicial system. To underscore the importance of compliance and to deter such conduct in the future, we impose a cost of Rs.5,000/-, payable to the Income Tax Department. 6.2. In light of the foregoing, the order of the CIT(A) for Assessment Year 2016-17 is set aside, and the matter is remanded to the file of the CIT(A) for a fresh adjudication on merits. The CIT(A) is directed to grant the assessee a reasonable opportunity of being heard and to duly consider all submissions and evidence submitted during the fresh appellate proceedings. The assessee is directed to fully cooperate with the proceedings and comply with all notices issued by the CIT(A). Any failure to do so may result in adverse consequences, including an ex-parte decision. 7. In the result, the appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the Open Court on 12th December, 2024 at Ahmedabad. Sd/- Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER (MAKARAND V. MAHADEOKAR) ACCOUNTANT MEMBER अहमदाबाद/Ahmedabad, िदनांक/Dated 12/12/2024 टी.सी.नायर, व.िन.स./T.C. NAIR, Sr. PS ITA No.1309/Ahd/2024 Smt. Sumitradevi Kamalkumar Agrawal vs. ITO Asst. Year : 2016-17 7 आदेश की #ितिलिप अ$ेिषत/Copy of the Order forwarded to : 1. अपीलाथ% / The Appellant 2. #&थ% / The Respondent. 3. संबंिधत आयकर आयु' / Concerned CIT 4. आयकर आयु' ) अपील ( / The CIT(A)-(NFAC), Delhi 5. िवभागीय #ितिनिध , आयकर अपीलीय अिधकरण , राजोकट/DR,ITAT, Ahmedabad, 6. गाड\u0010 फाईल / Guard file. आदेशानुसार/ BY ORDER, स&ािपत #ित //True Copy// सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad 1. Date of dictation (word processed by Hon’ble AM in his laptop) : 11.12.2024 2. Date on which the typed draft is placed before the Dictating Member. : 11.12.2024 3. Date on which the approved draft comes to the Sr.P.S./P.S : 4. Date on which the fair order is placed before the Dictating Member for pronouncement. : 5. Date on which fair order placed before Other Member : 6. Date on which the fair order comes back to the Sr.P.S./P.S. : 12.12.’24 7. Date on which the file goes to the Bench Clerk. : 12.12.’24 8. Date on which the file goes to the Head Clerk. : 9. The date on which the file goes to the Assistant Registrar for signature on the order. : 10. Date of Despatch of the Order : "