2019 (4) TMI 1158 - AT - Income Tax

Search and seizure action u/s 132(1) - ex-parte order - During the course of search cash, gold coins and diamond jewellery were found and accordingly additions were made - HELD THAT - Aggrieved by the order of AO, the assessee preferred an appeal before the Ld. CIT(A) who after considering the submissions and contentions of the assessee passed order dismissing the appeal of the assessee. During the course of hearing nothing has been brought before us to controvert the findings of the CIT(A) which otherwise appear to be correct and reasonable. After hearing the Ld. D.R. and considering the facts on record and merits of the case, we find that the Ld. CIT(A) has passed a reasoned order and we are inclined to affirm the same - Appeal of the assessee is dismissed

Summary

Issues:
- Addition of cash, gold coins, and diamond jewelry against principles of equity and natural justice.
- Failure to appreciate explanations for the source of cash, gold coins, and diamond jewelry.
- Failure to give credit for payments made to DD accounts.
- Ex-parte decision due to absence of the assessee during the appeal process.
- Affirmation of the order of the Commissioner of Income Tax (Appeals).

Analysis:
1. The appeal involved various grounds raised by the assessee challenging the additions made by the Assessing Officer (AO) related to cash, gold coins, and diamond jewelry. The assessee argued that these additions were against the principles of equity and natural justice. However, despite the explanations provided by the assessee regarding the source of these items, the AO and the Commissioner of Income Tax (Appeals) (CIT(A)) upheld the additions.

2. The assessee contended that the cash found was withdrawn from the bank and released by the investigation department, while the source of acquisition for the gold coins and diamond jewelry was fully explained. The AO and CIT(A) were criticized for not appreciating these explanations, leading to the additions being upheld. Additionally, the failure to give credit for payments made to DD accounts was raised as an issue in the appeal.

3. The proceedings took an ex-parte turn as the assessee failed to appear during the appeal process despite multiple opportunities provided. The Income Tax Appellate Tribunal (ITAT) granted a chance for the assessee to present the case on merits after a Misc. Application was filed for recalling the ex-parte order. However, even after this opportunity, the assessee did not appear, leading to the decision being made ex-parte with only the Departmental Representative (DR) present.

4. The judgment affirmed the order of the CIT(A) after considering the submissions and contentions of the assessee. The ITAT found no new evidence or arguments presented during the hearing to challenge the findings of the CIT(A). Consequently, the appeal of the assessee was dismissed with no order as to costs, upholding the additions made by the AO and CIT(A).

This detailed analysis outlines the issues raised in the appeal, the arguments presented by the assessee, the ex-parte nature of the proceedings, and the final decision of the ITAT affirming the order of the CIT(A) regarding the additions made to the income of the assessee.