This article provides a comprehensive analysis of the proceedings and final judgment in ITA No. 1869/DEL/2020, involving Vijay Kumar and the Income Tax Officer (ITO) Ward-45(4), New Delhi. The case was filed on November 18, 2020, and the final order was pronounced on July 29, 2021.
Vijay Kumar, a non-filer, was subjected to scrutiny by the Income Tax Department after information was received regarding cash deposits totaling Rs. 17,48,425/- in his savings bank account with Punjab National Bank, Gurudwara Road, Karol Bagh, New Delhi, during the Financial Year 2010-11, relevant to Assessment Year 2011-12. The Assessing Officer (AO) issued a notice under Section 148 of the Income Tax Act, 1961, but received no compliance from the assessee. Subsequently, the AO issued notices under Section 142(1) of the Act on various dates, again without any response from the assessee. The AO, therefore, proceeded to complete the assessment under Section 144 of the IT Act.
The AO observed that the assessee had made regular cash deposits and withdrawals through cash, ATM, and cheques. Consequently, the AO adopted a profit rate of 20% of the total credit transactions amounting to Rs. 17,58,425/-, determining the total income of the assessee at Rs. 3,49,685/-. The assessee appealed this decision to the Commissioner of Income Tax (Appeals) [CIT(A)], who issued three statutory notices to the assessee. However, the assessee did not appear before the CIT(A), leading to the dismissal of the appeal and the sustenance of the addition made by the AO.
The assessee, Vijay Kumar, contested the ex parte order of the CIT(A) and argued that he was not granted a proper opportunity to explain his case. He appealed to the Income Tax Appellate Tribunal (ITAT), seeking a fair chance to present his case.
The respondent, represented by Shri Rajesh Kumar Dhanesta, Sr. DR, supported the order of the CIT(A) and argued that the assessee had been given ample opportunities to present his case, which he failed to utilize.
The ITAT, presided over by Shri R.K. Panda, Accountant Member, examined the facts of the case and the arguments presented. The tribunal noted that the AO had completed the assessment based on the available information due to non-compliance by the assessee. The CIT(A) had also dismissed the appeal due to the assessee’s failure to appear and substantiate his case.
Considering the totality of the facts and in the interest of justice, the ITAT deemed it proper to restore the issue to the file of the CIT(A). The tribunal directed the CIT(A) to grant one final opportunity to the assessee to substantiate his case and decide the issue based on facts and law. The ITAT also directed the assessee to appear before the CIT(A) and present his case without seeking any adjournments under any pretext.
The final order, pronounced on July 29, 2021, reads:
In the result, the appeal filed by the assessee is allowed for statistical purposes. Pronounced in the open court at the time of hearing itself, i.e., on 29.07.2021.
Signed by:
Shri R.K. Panda, Accountant Member
This judgment emphasizes the importance of providing a fair opportunity to the assessee to present his case and ensures that justice is served based on a thorough examination of facts and law.
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