TaxTMI 
TaxTMI 
2023 (3) TMI 554
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.... for cash deposited by the appellant in his bank account, by ignoring all the evidences and documents filed by the appellant. 5. That the appellant craves leave to add or alter any of the Grounds of Appeal." 2. At the time of hearing no one attended the proceedings. However, it is stated vide letter dated 10.01.2023 that the written submissions dated 12.09.2022 may be considered and the appeal may be decided on the basis of the submissions of the assessee. Under these facts the appeal of the assessee was taken up for hearing in the absence of the assessee and is being decided after hearing the learned DR and on the basis of material available on record. 3. Facts giving rise to the present appeal are that case of the assessee was reopened on the basis that the assessee had deposited a sum of Rs. 31,70,000/- in his savings bank account. The Assessing officer has recorded that in response to the notice u/s. 148 of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), no one attended the proceedings and no return was filed. Therefore, a fresh notice u/s. 142(1) of the Act was issued. Thereafter, the case was fixed from time to time and on 25.02.2015 the assess....
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....Shri Jai Shiv Shankar Traders Pvt. Ltd. 383 ITR 455 (Del) Silver Line 398 ITR 701 (Del) Paramount Biotech Industries Ltd. 323 ITR 249 (Del) Society for Worldwide Inter Bank Financial Telecom 1.3 In his written submission dt. 8.3.202, Ld. DR is trying to take shelter u/s. 292BB of the Act. In this regard, it is to submit that non issuance of notice u/s. 143(2) is a basic jurisdictional error and cannot be cured/condoned by referring to section 292BB of the Act. Ld. DR in his written submission has cited some case laws. These case laws are not applicable on the facts and circumstances of the case, on the grounds mentioned here under:- (i) Broadway Shoe Company 99 taxmann.com 83 (J & K): in this case no return was filed by the appellant. Hence ratio in this judgment is not applicable on the present appeal of the appellant. (ii) Madhya Bharat Energy Corporation Ltd. 337 ITR 389 (Del):-this case was distinguished by Hon'ble Delhi High Court in the matter of Silver Line 383 ITR 455. (iii) Josh Builders and Developers Pvt. Ltd. 79 taxmann.com 435(P & H):-in this case, notice u/s. 143(2) was issued. Issue was regar....
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.... of the Act was issued on 09.01.2015 for 30.01.2015. On 30.01.2015 none attended. Again the case was refixed on 10.02.2015. On 10.02.2015 the notice remained unattended too. The case was again fixed for 25.02.2015 and the assessee filed written reply with a copy of the acknowledgement of the return already filed on 16.08.2007 may be treated as return filed in response to the notice u/s. 148 of the Act. It was examined and placed on the record by the AO. On this date the assessee was also supplied a copy of the reasons recorded for issue of notice u/s. 148 of the I.T. Act in his case. As per note sheet entry of the AO record on 25.02.2015 the assessee was also asked to explain the source of cash deposits in the bank at Rs. 31,70,000/- as mentioned a copy of reasons supplied to him. On 16.03.2015 Sh. Subhash Gurjar, the assessee attended the assessment proceedings with Sh. P. Narang, Adv. They submitted written reply alongwith various documents regarding sale of his agricultural land measuring 5 kanal-09 Marla against which he filed copy of agreements from different purchasers for sale of said land to explain the cash deposits in his bank account. It was further stated that the sale ....
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.... the assessment. Furthermore, the assessee's contention with regard to issue of notice u/s. 143[2] is not maintainable in view of section 292BB of the I T Act, 1961 which is reproduced below: "Notice deemed to be valid in certain circumstances. 292BB. Where an assessee has appeared in any proceeding or co-operated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any provision of this Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of this Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was-- (a) not served upon him; or (b) not served upon him in time; or (c) served upon him in an improper manner: Provided that nothing contained in this section shall apply where the assessee has raised such objection before the completion of such assessment or reassessment." Since the assessee has participated in assessment proceedings the notice u/s. 143[2] was deemed to have been issued in view of Section 292BB [supra]. Hence, ....
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....see has relied upon various case laws as stated in para 1.2 of his submissions. On the other hand, contention of learned D.R. is that this issue is taken first time. The assessee failed to file ITR within time in pursuance of notice u/s. 148 of the Act. Hence, now assessee cannot take advantage of his own negligence and lapse. He further placed reliance on provisions of Section 292BB of the Act to buttress the contention that non-issuance of notice u/s. 143(2) would not vitiate the proceedings u/s. 147 of the Act. I find that the Assessing Officer has observed as under : "As per record, to enquire into the source of above deposits, various notices were issued from this office to the assessee but nothing was heard from the assessee from 31.07.2009 to 10.02.2014. Accordingly notices u/s. 148 of the Act was issued in this case on 18.03.2014 which was duly served upon the assessee through speed post sent vide dispatch No. 12388 dated 18.03.2014. In response to notice issued, the assessee did not file his return of income. Again notice u/s. 142(1) was issued on 02.09.2014, sent through speed post vide dispatch No. 2010 for 10.09.2014 requiring the assessee to file his return of....
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....ue to certain circumstances and the money received by the seller was to be returned to the purchasers through panchayati settlements. The assessee also stated that he sold buffalo and from-J. etc. and the cash deposits in the bank were out of such sale proceeds. They submitted that in view of written submission filed, the proceedings may be dropped. The case was discussed with them. Assessee derives income from rent and income from furniture business during the year. Perusal of the documents submitted by the assessee reveals that the assessee is having in his name only 5 K-09 Marla of agril land at Jhajjar for which Fard/Jamabandi have been filed by the assessee. It is also noticed that there are co-owners of the said land which was stated to be sold to different persons as per details given below:- Land Total consideration Date Baiana received i) 1K -12 Marla Rs. 8,00,000/- 5.4.2006 3,50,000/- ii) 2K-00M Rs. 12,00,000/- 8.4.2006 1,20,000/- iii) 2K- 2.5m Rs. 18,00,000/- 20.11.2006 3,50,000/- The assessee submitted photo copies of the agreements for the above transactions to prove the cash deposits ....
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....of the act for furnishing of inaccurate particulars of income are being initiated separately. Subject to above remarks, income of the assessee is computed as under:- Income as per return filed Rs. 92,020/- Addition as discussed above Rs. 31,70,000/- Taxable income Rs. 32,62,020/-." 7. The grievance of the assessee in respect of reopening of the proceedings u/s. 147 of the Act are two-fold - (i) that the notice u/s. 148 of the Act was issued just to make fishing inquiry without being based upon any material evidence; and (ii) that the statutory notice u/s. 143(2) was not issued and served upon the assessee. The assessee has filed reasons as recorded for reopening of the assessment along with paper book. As per this, it was stated that the assessee had deposited a sum of Rs. 31,70,000/- in his bank account. The explanation was sought whether such amount was disclosed in the return of income and source thereof. Therefore, the Assessing officer formed his belief that amount of Rs. 31,70,000/- was chargeable to tax and escaped assessment. I do not see any infirmity into the order of the Assessing Officer so far the first objection of the assessee is concern....
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....urt in the case of ACIT Vs. Hotel Blue Moon (supra), non-issuance of notice u/s. 143(2) of the Act is a jurisdictional error on the part of Assessing Authority. Hence, Section 292BB of the Act would not help AO. The impugned assessment so framed without issuance of notice u/s. 143(2) is illegal, hence deserves to be annulled. It is pertinent to note that the judgment of Hon'ble Punjab & Haryana High Court rendered in the case of Josh Builders & Developers (P.) Ltd. (supra), has been rendered on different set of facts, hence do not help Revenue. From the records placed before me it is evident that AO failed to issue notice u/s. 143(2) of the Act. Hence, the assessment framed by the AO is without authority of law. I hold accordingly. Ground No. 3 of the assessee's appeal is allowed. 11. Apropos to ground No. 4, it is stated that the assessee had filed supporting evidences regarding availability of cash. The assessee has filed a cash flow statement in paper book, which is reproduced as under : Date Particulars Amount Date Particulars Amount 05.04.2006 Om Parkash S/0 Amar Singh 350,000.00 31.08.2006 SELF 500,000.00 08.04.2006 Om Park....
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....p; 200000.00 342367.00 cr. 20.11.2006 By cash 390000.00 732367.00 cr. 27.11.2006 By cash 250000.00 982367.00 cr. 02.12.2006 By transfer 424373.00 1406740.00 cr. 02.12.2006 By transfer 424373.00 1831113.00 cr. 28.12.2006 To cash 150000.00 1681113.00 cr. 03.10.2007 To cash 220000.00 1461113.00 cr. 18.01.2007 To cash 1350000.00 111113.00 cr. 02.03.2007 By cash 600000.00 711113.00 cr. 10.03.2007 By interest 8401.00 719514.00 cr. 14.03.2007 To cash 350000.00 369514.00 cr. 21.03.2007 To cash 150000.00 219514.00 cr. Total balance  ....
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....ere is no documentary evidence that wheat was produced on the said land. There was also no evidence to show that income from agriculture produced on the land of family members was only deposited in his bank account. Thus mere submission of Form J and non compliance of the assessee before the AO to substantiate his claim during remand proceedings, renders his claim unacceptable. 6.2.4 The assessee's claim of sale of cattle is also not acceptable in view of the fact that a receipt has been submitted and name of purchaser has been given. There is no proof that the assessee was in possession of the cattle. The assessee did not avail the opportunity given by the AO during remand proceedings substantiate the claim made by him in this regard. Thus the sale of cattle and deposit of Rs. 1,20,000/- is not found acceptable. 6.2.5 The assessee's claim of cash deposits on account of receipt of 'bayana' for purposed sale of agricultural land which later did not materialize and was cancelled and the money was refunded is considered and the documents submitted by him including copy of notarized 'ikrarnama' and bank statement showing the cash deposits on th....