2022 (4) TMI 503 - AT - Income Tax

Unexplained cash deposits found to be made in the bank account - non-compliance on the part of the assessee before the authorities below - Assessee submitted that during the course of appellate proceedings before the learned CIT(A), one of the close relatives of the assessee was infected with Corona Virus who finally succumbed to the said disease, and in view of this distress condition, the assessee could not comply even with the notices issued by the learned CIT(A) - HELD THAT - Keeping in view the submissions made by the learned representatives of both the sides and having regard to all the facts of the case, we are of the view that it would be fair and proper and in the interest of justice to give one more opportunity to the assessee to put-forth his case on merit subject, however, to imposition of cost on the assessee for the casual approach. We accordingly direct the assessee to pay an amount of ₹ 5,000/- to the Prime Minister s Relief Fund as cost and subject to the said payment, we restore the matter to the file of the Assessing Officer for deciding the same afresh - Appeal of the assessee is treated as allowed for statistical purposes.

Summary

Issues involved: Addition of cash deposits in bank account as unexplained.

Analysis:
The appeal was against the addition of ?13,10,000 made by the Assessing Officer and confirmed by the CIT(A) on account of cash deposits in the assessee's bank account. The assessee, an individual, had declared a total income of ?1,96,000 under Section 44AE of the Income-tax Act, 1961. The deposits of ?13,10,000 were not commensurate with the declared income, leading to the assessment being reopened by the Assessing Officer. The assessment was completed ex-parte, and the addition was made on account of unexplained cash deposits. The assessee failed to respond to notices issued during the assessment proceedings, resulting in dismissal of the appeal by the CIT(A) for non-prosecution. The Tribunal heard arguments from both sides and considered the submissions. The assessee's counsel cited reasons for non-compliance, including the assessee's illiteracy and a family member's death due to COVID-19. The Tribunal found it fair to give the assessee another opportunity to present their case, subject to a cost of ?5,000 to be paid to the Prime Minister's Relief Fund. The matter was restored to the Assessing Officer for fresh assessment with the direction for the assessee to cooperate and comply. The appeal was treated as allowed for statistical purposes, with the order pronounced on 8th April, 2022 at Ahmedabad.