VAJSHIBHAI SUKABHAI KESHWALA,PORBANDAR V. THE COMMISSIONER OF INCOME TAX(APPEALS), PORBANDAR

ITA 458/RJT/2024

AI Insights

The case involves an appeal by Vajshibhai Sukabhai Keshwala against the order of the National Faceless Appeal Centre, which confirmed a penalty imposed by the Assessing Officer under section 271(1)(c) of the Income Tax Act, 1961. The penalty of Rs. 11,20,860 was imposed due to unexplained cash deposits amounting to Rs. 29,01,900 in the assessee's bank accounts, which were not added back to the income. The Tribunal noted that the assessee had not complied with the notices during the assessment proceedings but decided to remit the matter back to the Assessing Officer, providing the assessee another opportunity to present his case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 26385 (ITAT-RAJKOT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHIMANYU SINGH YADAV; LD.
• Assessee Lawyers: JAGDISH TRIVEDI; LD
• Keywords: Set aside; Unexplained cash credit
• Section: 271(1)(c); 69A; 274

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकरअपीलसं./ITA No. 458/RJT/2024 (Ǔनधा[रणवष[ / Assessment Year: (2014-15) (Hybrid Hearing) Vajshibhai Sukabhai Keshwala Plot No. 1, At Keshav, Via Bagvadar Dist. Porbandar – 360590 Vs. The Commissioner of Income Tax(Appeals), Porbandar Assessment Unit, Income Tax Department, National Faceless Assessment Centre èथायीलेखासं./जीआइआरसं./PAN/GIR No.: BODPK9597N (Appellant) (Respondent) Appellant by : Shri Jagdish Trivedi, Ld. AR Respondent by : Shri Abhimanyu Singh Yadav, Ld. Sr. DR Date of Hearing : 24/03/2025 Date of Pronouncement : 26/03/2025 आदेश / O R D E R PER DINESH MOHAN SINHA, JM: Captioned appeal filed by the assessee is directed against the order passed by the National Faceless Appeal Centre [(in short “NFAC/Ld. CIT(A)”] vide order dated 28.05.2024, which in turn assessment order passed by Assessment Unit, Income Tax Department / Assessing Officer under section 241(1)(e) and 147 r.w.s. 144 and 144B of the Income Tax Act, 1961 (in short “the Act”), vide order dated 22.09.2022. 2. Grounds of appeal raised by the assessee are as follows: Page | 2 Vajshibhai Sukabhai keshwala ITA No. 458/Rjt/2024 (AY 2014-15) 1) On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in confirming the AO’s action invoking penalty proceeding of Rs. 11,20,860/- under the provisions of s. 271(1)(c) of the Act. The facts applicable to the case on surmises and conjectures formed an opinion, with a quote that the appellant is not interested in pursuing the appeal. The appellant submits that the said penalty is without assigning justified ground and factual position as well as past records of the appellant, and is arbitrary in nature. The appellant prays that the said penalty may please be deleted order may please be quashed. 2) On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in not considering merits of the main case which is pending before the Hon’ble Income Tax Appellate Tribunal, Rajkot, wherein facts of the case are assigned justified ground and factual position as well as records produced along with appeal memo. Further, the Ld. CIT(A) erred in considering the facts of the case and evidences submitted with appeal memo in Form No. 35. The appellant prays that the said order on account of non available of information may please be removed and matter remanded till finalization of appeal by the Hon’ble Income Tax Appellate Tribunal, Rajkot. 3. Brief facts of the case that the appellant has filed return of income for AY 2014-15 declaring income of Rs. 1,86,140/- and agricultural income of Rs. 4,25,000/- for AY 2014-15 was issued on 08.05.2020. As per the information, the appellant has deposited Rs. 45,80,900/- by way of cash in his saving bank accounts, for which, the Ld. Assessing Officer wanted to know the source of income. A notice u/s. 148. In response, the appellant has filed various details establishing deposition of cash amount in the saving bank accounts. During the year the same as an unexplained cash source. A show cause notice issued on 26.03.2022, as to the same not added back to the income of the appellant as unexplained cash credits of Rs. 29,01,900/-. Therefore, the assessment proceedings were finalized ex-parte u/s. 147 r.w.s. 144 and 144B of the I. T. Act, 1961 on 12.03.2022 determining assessed income at Rs. 30,88,040/- after making addition of Rs. 29,01,900/- on account of unexplained money u/s. 69A of the Act and demand of Rs. 19,54,675/- has been raised. A notice u/s. 274 r.w.s. 271(1)(c) of the Act dated 11.08.2022, 05.09.2022 and 12.09.2022 and the said notice were Page | 3 Vajshibhai Sukabhai keshwala ITA No. 458/Rjt/2024 (AY 2014-15) served upon the assessee. In response to the show cause notices, the assessee did not bother to submit any reply. The details of penalty notices issued by the Income tax Department. Since, the assessee has not fully cooperated during the course of assessment proceedings. The Ld. AO impose a penalty of Rs. 11,20,860/-, u/s. 271(1)(c) of the I. T. Act, by order dated 21.09.2022. 4. That the assessee filed an appeal against the order of the Ld. CIT(A), vide order dated 22.09.2022. 5. During the course of hearing, the Ld. AR of the assessee submitted that sister of the consultant met with cancer and was busing in treatment, hence the assessee could not comply with the notices issued by the Ld. CIT(A). Therefore, the Ld. AR of the assessee prayed for an opportunity to be given to the assessee to present his case before the lower authority. 6. On the other hand, the Ld. Sr. DR has relied upon the order of the Ld. CIT(A) and not objected to the prayer of the Ld. AR. 7. We have heard both the parties and perused the documents available on record. We note that four notices have been issued by the Ld. CIT(A), but there was no compliance to the notice . The ex-parte order of Ld. CIT(A) is silent on service of the notice upon the assessee, we also note that before the Ld. AO. there was no compliance hence and ex-parte order for levying penalty was proceed. However, we are of the view that an opportunity should be given to the assessee to present his case before the Lower Authority. We set aside the order of Ld. CIT(A) and remit the matter back to the file of Ld. AO for fresh adjudication on merit after giving due opportunity to the assessee to proceed the case. Page | 4 Vajshibhai Sukabhai keshwala ITA No. 458/Rjt/2024 (AY 2014-15) In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 26 -03-2025 Sd/- Sd/- (A. L. SAINI) (DINESH MOHAN SINHA) ACCOUNTANT MEMBER JUDICIAL MEMBER Rajkot (True Copy) Ǒदनांक/ Date:26/03/2025 Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. Pr. CIT 5. DR/AR, ITAT, Rajkot 6. Guard File By Order Assistant Registrar/Sr. PS/PS ITAT, Rajkot "