YOGESH DURGADAS PHAL,PUNE V. ITO, WARD 3(2), PUNE, PUNE

ITA 436/PUN/2025

AI Insights

The case involves Mr. Yogesh Durgadas Phal, the appellant, contesting an order from the Commissioner of Income Tax (Appeals) which confirmed an addition of cash deposits under section 69A of the Income Tax Act, 1961, for the assessment year 2017-18. The appellant argued that the addition of Rs. 19,75,000 was unjust as it was from withdrawals made from the same bank. Additionally, the appellant contested the interest levied under sections 234A and 234B. The CIT(A) had dismissed the appeal for non-compliance without addressing the merits. The Tribunal, referencing a decision by the Bombay High Court, found that the CIT(A) is obligated to decide on the merits and cannot dismiss the appeal for non-prosecution.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 316029 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Other Referred Cases: Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MADHAN THIRMANPALLI
• Assessee Lawyers: SAILEE GUJARATHI
• Keywords: Set aside; Opportunity of being heard
• Section: 234B

Judgement Text

" आयकर अपीलीय अिधकरण ”एस एम सी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC” :: PUNE BEFORE MS.ASTHA CHANDRA, JUDICIAL MEMBER AND DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.436/PUN/2025 िनधाᭅरण वषᭅ / Assessment Year: 2017-18 Mr.Yogesh Durgadas Phal, 309/33 Gokhale Nagar, Shivaji Nagar, Opp.Patrakar Nagar, Haweli, Pune – 411016. Maharashtra. V s The Income Tax Officer, Ward-3(2), Pune. PAN: ABJPP1640F Appellant/ Assessee Respondent / Revenue Assessee by Shri Sailee Gujarathi – CA Revenue by Shri Madhan Thirmanpalli – Addl.CIT(DR) Date of hearing 14/05/2025 Date of pronouncement 15/05/2025 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the assessee is against the order of ld.Commissioner of Income Tax(Appeals)[NFAC], passed under section 250 of the Income Tax Act, 1961; dated 29.11.2023 for Assessment Year 2017-18. The assessee has raised the following grounds of appeal : ITA No.436/PUN/2025 [A] 2 “1. On the facts and the circumstances of the case and in law, the Honorable CIT(A) NFAC erred in confirming addition of cash deposited in Canara Bank under section 69A of the Act without appreciating the facts of the case in a proper perspective. The Honorable CIT(A), NFAC failed to appreciate that the same was out of withdrawals made out of the very same bank. Hence, the appellant hereby prays that the addition of Rs. 19,75,000/- be deleted. 2. On the facts and in the circumstances of the case and in law, the leamed AO has erred in levying interest under section 234A and 234B of the Act amounting to Rs.4,42,424/- and Rs. 5,03,448/- respectively and to re-compute its total income and tax liability accordingly. 3. The appellant hereby reserves the right to add, amend, alter, or raise any additional ground or grounds of appeal or delete or withdraw any of the grounds of appeal.” 2. The ld.Authorised Representative(ld.AR) for the Assessee submitted that assessee’s appeal was dismissed by the ld.CIT(A) without discussing each and every ground and merits of the case and merely dismissed for non-compliance. Hence, ld.AR requested for one more opportunity of being heard to the assessee. Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue relied on the order of Assessing Officer(AO) and ld.CIT(A)[NFAC]. Findings & Analysis : 4. We have heard both the parties and perused the records. It was observed from the order of the ld.CIT(A) that Ld.CIT(A) issued ITA No.436/PUN/2025 [A] 3 noticed dated 25.07.2022, 12.06.2023 and 17.10.2023 to the Assessee. The ld.CIT(A) stated that Assessee has been provided with number of opportunities but Assessee has not made any compliance. 4.1 It is observed from the order of the ld.CIT(A)[NFAC] that the ld.CIT(A)[NFAC] did not decide the grounds of appeal on merit, but merely dismissed the appeal of the assessee. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits. 4.2 The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF)(Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “8.From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an ITA No.436/PUN/2025 [A] 4 assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) is coterminous with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non- prosecution as is evident from the provisions of the Act.” Unquote. 5. Thus, the Hon’ble Bombay High Court has categorically held that ld.CIT(A) has to decide the appeal on merit and ld.CIT(A) does not have any power to dismiss appeal for non-prosecution. 6. In view of the above, in the interest of justice, we set-aside the order of the ld.CIT(A) to ld.CIT(A) for denovo adjudication. Ld.CIT(A) shall provide opportunity to the assessee. Assessee shall file all the necessary documents before the ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose. ITA No.436/PUN/2025 [A] 5 7. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 15th May, 2025. Sd/- Sd/- (ASTHA CHANDRA) (DIPAK P.RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 15 May, 2025/ SGR आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “एस एम सी” बᱶच, पुणे / DR, ITAT, “SMC” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune. "