SUKHRAJ KAUR,FEROZEPUR V. ITO, FEROZEPUR

ITA 58/ASR/2024

AI Insights

This case involves an appeal by Sukhraj Kaur against the order of the Ld. CIT (A) NFAC, which confirmed the action of the Assessing Officer (AO) in making an addition of Rs. 37 lakhs to the assessee's income under section 69 of the Income Tax Act, 1961. The addition was based on a cash payment made for the purchase of land, which the AO deemed unexplained. The assessee argued that she was not given an adequate opportunity to present her case, as the notices were sent to an email address managed by her previous tax consultant, who failed to inform her of the hearing dates. The tribunal found merit in the assessee's claim of not having a proper opportunity to explain her cash flow and remanded the case back to the CIT (A) for a fresh hearing.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 23330 (ITAT-AMRITSAR)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-10-2024
• Assessment Year: 2014-2015
• Appeal Filed On: 12-02-2024
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRADEEP KUMAR
• Assessee Lawyers: ASHRAY SARNA
• Keywords: Principle of natural justice
• Section: 147; 69

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. UDAYAN DAS GUPTA, JUDICIAL MEMBER I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 Sukhraj Kaur, Near Cold Store, VPO, Satia Wala, Ferozepur, Punjab. [PAN:AAVPK3105F] (Appellant) Vs. ITO, Ferozepur. (Respondent) Appellant by Sh. Ashray Sarna, CA Respondent by Sh. Pradeep Kumar, Sr. DR Date of Hearing 17.10.2024 Date of Pronouncement 18.10.2024 ORDER Per: Udayan Das Gupta, JM This appeal is presented by the assessee against the order of the Ld. CIT (A) NFAC, dated 23/01/2024, passed u/s 250(6) of the Act 61, which has emanated from the order of the AO, NFAC, passed u/s 147 r.w.s. 144B of the Act 61. 2. The grounds of appeal taken by the assessee in form 36 are as follows: “1. Thai the order passed by the Hon’ble CIT (A) dated 23.01.2024 is against the law and facts of the case. I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 2 2. That having regard to the facts and circumstances of the ease. Hon’ble CIT(A) has erred in law and on facts in confirming the action of ld. AO in framing the impugned assessment order u s 147 read with section 144B of the Income Tax Act and without complying with the mandated conditions u/s 143.147/151 as envisaged under the Income Tax Act. 1961. 3. That having regard to the facts and circumstances of the case. Hon’ble CIT(A) has erred in law and on facts in confirming the action of ld. Assessing Officer in passing order without giving adequate opportunity of hearing and without appreciating the facts before the ld. AO. 4. That having regard to the facts and circumstances of the case. Hon’ble CIT(A) has erred in law and on facts in confirming the action of ld. AO in making an addition of Rs. 37.00.000/- u/s 69 of the Act. without considering the facts of the case and without observing the principles of natural justice. 5. That having regard to the facts and circumstances of the case. Hon’ble CIT(A) has erred in law and on facts in confirming the action of ld. AO in making an addition u/s 69 of the Act and charging (ax as per section 1 I5BBE of the Act. without considering the facts of the case. 6. That die appellant craves the leave to add. modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.” I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 3 3. The facts of this case in brief are that, the lady assessee has paid an amount of Rs.37 lakhs (thirty seven lakhs) in cash to one Mr. Samunder Singh, for purchase of a plot of land, on 5th July, 2013. In absence of any regular return on record the AO initiated proceedings u/s 147 of the Act 61, by issue of 148 notice dated 30/03/2021. In response to such notice, the assessee filed return and complied with the AO in assessment proceedings in response to notice u/s 143(2), by filing necessary explanations and submissions and cash flow statement for explaining the availability of the source of cash. However, due to reasons contained in the assessment order the AO was not satisfied with the evidences and submissions of the assessee and has completed the assessment by making an addition of Rs. 37 lakhs to the returned income u/s 69 of the Act 61 and consequently, has applied the provisions of section 115BBE of the Act 61, for tax rate purpose. 4. The matter was carried in appeal before the first appellate authority, and there has been no compliance before the Ld. CIT (A), even though statement of facts and grounds of appeal are on record. It is further observed that notice of hearing from the office of the first appellate authority has been issued on FOUR separate dates fixing the case for hearing four times, through the e filing portal and also at the email id, registered in the portal, and thereafter, the Ld. CIT (A) has I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 4 proceeded to dispose of the case on the basis of grounds of appeal and materials on record, and has sustained the addition, as per his observation in the appellate order. 5. In course of hearing before the tribunal, the Ld. AR of the assessee, submitted, (referring to ground no 2 of the memorandum of appeal), that proper and adequate opportunity of hearing has not been allowed to the lady appellant, in as much the notice of hearing issued in the email id registered in the portal ([e-mail],) was not assessable by the appellant, because it might have belonged to her previous tax consultant, who never informed her about the hearing dates and as such no representation could be caused. 6. He further submitted that the main issue of availability of cash, on a particular date, can only be explained by way of the cash flow statement, supported by bank statements, and bank withdrawals, taking into account the receipts from agricultural activity throughout the year from agricultural land holdings and supporting jamdani, and in the instant case the appellant never had the opportunity to explain the contents of the cash flow statement, before the first appellate authority along with corroborating bank entries, which will prove the availability of requisite cash , to the satisfaction of the revenue. 7. As such he prayed for an opportunity to explain his case to the satisfaction of the Ld. CIT (A), because according to him, the assessee never had any I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 5 knowledge of the notices issued in the email id of the portal, so no representation could be made. 8. The Ld. DR, relied on the order of the Ld. CIT (A) and argued that it is the duty of the assessee and her Ld. counsel, to keep track of IT portal, especially when appeal has been filed, and in the instant case, there has been a failure on the part of the Ld. AR or the counsel, to keep track of departmental notices. 9. We have heard the rival submissions and considered all materials on record and we find that the assessee has filed her return and cooperated in course of re assessment proceedings, and cash flow statement and written explanations are on record, and, before the first appellate authority, the statement of facts and grounds are on record , but in absence of any representation from the assessee or her counsel , the cash flow could not have been properly explained vis a vis bank statements and other documentary evidences , for proper disposal of the case. 9.1 As such in the interest of justice we are of the opinion that , the appellant may be allowed one more opportunity to explain her case with all necessary documentary evidences in support of her grounds of appeal contained in Form 35, and as such we remand the matter back to the files of the Ld. CIT (A), for deciding the grounds contained in the appeal memo, on merits after affording proper I.T.A. No.58/Asr/2024 Assessment Year: 2014-15 6 opportunity of hearing to the assessee and the assessee is also directed to submit all necessary evidences and submissions including cash flow, in support of her case. 9.2 Since we have remanded the matter for fresh consideration, the grounds on merits are academic and not adjudicated. 10. In the result, the appeal of the assessee bearing ITA No. 58/Asr/2024 is allowed for statistical purposes. Order pronounced in the open court on 18.10.2024 Sd/- Sd/- (Dr. M. L. Meena) (UDAYAN DAS GUPTA) Accountant Member Judicial Member AKV Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order "