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2021 (5) TMI 889 - AT - Income TaxReopening of assessment u/s.147 - issuing notice u/s.148 - addition u/s 69 - search carried out at the premises of assessee - CIT(A) while confirming the order of AO dismissed the appeal on account of non-prosecution - HELD THAT - In case of Shri Rajiv K.Tulsiyan, Brother-inlaw of assessee . 2018 (6) TMI 1754 - ITAT SURAT tribunal on almost similar set of facts, in case of Shri Rajiv K.Tulsiyan, while admitting the additional evidence, restored the matter to the file of the AO. As considering the statement of assessee and Rajiev K Tulsiyan, recorded by DRI that the affair of assessee s firm was also managed by Rajiv K.Tulsiyan. The ld. AR also vehemently submitted that father of Rajiv K.Tulsiyan was not well during the period when the appeal of assessee was pending before first appellate authority and ultimately died. Further, considering the facts that lower authorities have passed ex-party order against the assessee. Therefore, keeping in view the principal of natural justice that the impugned order is passed without hearing the assessee. Accordingly the additional ground of appeal raised by the assessee is allowed. Appeal of the assessee allowed for statistical purpose.
Issues Involved:
1. Reopening of the assessment under section 147 and issuance of notice under section 148 of the Income Tax Act, 1961. 2. Addition of ?43,68,000/- on account of alleged unexplained investment in goods in the form of fabrics put on hold. 3. Addition of ?84,92,899/- on account of export of man-made fabrics to Afghanistan treated as alleged unexplained investment under section 69 of the Income Tax Act, 1961. 4. Addition of ?32,89,382/- on account of alleged sale of DEPB scripts. 5. Addition of ?1,00,000/- on account of alleged income from other sources. 6. Adequate opportunity to the assessee and passing of ex-parte and non-speaking order by the CIT(A). Detailed Analysis: 1. Reopening of the assessment under section 147 and issuance of notice under section 148: The assessee challenged the reopening of the assessment under section 147 and the issuance of notice under section 148. The assessment was reopened based on information from the Directorate of Revenue Intelligence (DRI) following a search at the assessee’s premises, which revealed various incriminating documents. The Assessing Officer (AO) issued a notice under section 148 on 19.09.2011, but the assessee did not respond. Subsequently, the AO issued a notice under section 142(1) and ultimately completed the assessment under section 144 read with section 147 due to non-compliance by the assessee. 2. Addition of ?43,68,000/- on account of alleged unexplained investment in goods in the form of fabrics put on hold: During the search, it was found that the assessee had misdeclared the value of goods intended for export. The declared value was ?3,13,61,422/-, whereas the actual value was ?43,68,000/- as determined by the Expert Committee of DRI. The AO concluded that ?43,68,000/- was an undisclosed investment by the assessee. 3. Addition of ?84,92,899/- on account of export of man-made fabrics to Afghanistan: The DRI investigation also revealed that the assessee exported man-made fabrics to Afghanistan with a Free on Board (FOB) value of ?6,06,63,561/-, while the actual value was ?84,92,899/-. The AO treated this discrepancy as unexplained investment under section 69 of the Income Tax Act, 1961. 4. Addition of ?32,89,382/- on account of alleged sale of DEPB scripts: Documents seized during the search indicated that the assessee had sold five Duty Entitlement Pass Book (DEPB) scripts fraudulently for a consideration of ?32,89,382/-. The AO added this amount to the assessee’s income. 5. Addition of ?1,00,000/- on account of alleged income from other sources: The AO noted that the assessee had disclosed an income of ?1,08,456/- from other sources in the previous assessment year (2008-09). Since no return was filed for the current assessment year and no evidence was provided, the AO estimated an income of ?1,00,000/- from other sources. 6. Adequate opportunity to the assessee and passing of ex-parte and non-speaking order by the CIT(A): The assessee argued that the CIT(A) did not provide adequate opportunity for a hearing and passed an ex-parte and non-speaking order. The assessee's representative submitted that similar cases involving the assessee’s brother-in-law, who managed the business, were restored to the AO by the Tribunal due to similar circumstances. The Tribunal noted that the CIT(A) dismissed the appeal due to non-prosecution and did not follow the mandate of Section 250(6) of the Act, which requires a speaking order. Conclusion: The Tribunal admitted the additional ground of appeal raised by the assessee, which was purely legal and did not require additional facts. Considering the principle of natural justice and the similar case of the assessee’s brother-in-law, the Tribunal restored all the issues to the file of the AO to pass a fresh order after granting the assessee an opportunity of hearing. The appeal was allowed for statistical purposes, with instructions for the AO to provide a fair hearing and for the assessee to cooperate and provide necessary information. Order: The appeal of the assessee was allowed for statistical purposes, and the AO was directed to pass a fresh order after granting an opportunity of hearing to the assessee. The order was pronounced on 15-10-2020.
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