2022 (4) TMI 1316 - AT - Income Tax

Ex-parte assessment order passed u/s 144 read with section 147 - addition on account of trading in penny stock - Appeal at 8th time before this tribunal - HELD THAT - As the assessee was not co-operative before the Assessing Officer even after providing six opportunities, therefore, the Assessing Officer was constrained to pass best judgement assessment. Even before the Ld. CIT(A) the assessee has not produced any details or evidences to substantiate her claim. However, the Ld. CIT(A) has passed a very detailed order running into 41 pages and thereby confirmed the addition. Even before us the assessee has simply raised general grounds without any material or evidence. In the absence of the same and having given seven opportunities, the assessee has not shown any interest in proceeding the matter further. We, therefore, see no reasons to interfere with the orders of the Lower Authorities and confirm the addition made by the Assessing Officer. Thus, the grounds of appeal are liable to be rejected and appeal is dismissed.

Issues:
1. Failure to file return of income under Section 139(1) for A.Y. 2011-12.
2. Addition of income on account of trading in penny stock.
3. Initiation of penalty proceedings under Section 271(1)(c) and Section 271F for failure to furnish return of income.
4. Admissibility of additional evidences under Rule 46A during appellate proceedings.
5. Dismissal of appeal by the assessee against the order of Ld. CIT(A).

Issue 1: Failure to file return of income under Section 139(1) for A.Y. 2011-12
The appellant, engaged in share trading, failed to file the return of income for the relevant assessment year. Despite notices and opportunities, the appellant did not respond, leading to an ex-parte assessment order under section 144 read with section 147 of the Income Tax Act, making an addition of the income related to trading in penny stock.

Issue 2: Addition of income on account of trading in penny stock
The Assessing Officer made an addition to the income of the appellant based on trading in penny stock of a specific company. The appellant contended before the Ld. CIT(A) that the income was not accrued and should not be treated as actual income. However, after detailed examination and reliance on legal precedents, the addition was confirmed due to lack of substantiated evidence proving the genuineness of the transactions.

Issue 3: Initiation of penalty proceedings under Section 271(1)(c) and Section 271F
Penalty proceedings were initiated against the appellant for failure to furnish the return of income. The appellant argued against the initiation of penalties, claiming no concealment of income or inaccurate particulars. However, the authorities found the appellant's lack of cooperation and failure to provide evidence supporting the genuineness of investments, leading to the confirmation of the penalties.

Issue 4: Admissibility of additional evidences under Rule 46A during appellate proceedings
During the appellate proceedings, the appellant sought to file additional evidences under Rule 46A. The Ld. CIT(A) admitted the evidence, leading to a detailed order relying on legal decisions to support the conclusion that the transactions were not genuine, ultimately confirming the addition of income.

Issue 5: Dismissal of appeal by the assessee against the order of Ld. CIT(A)
The appellant's appeal against the order of Ld. CIT(A) was dismissed by the tribunal due to the appellant's lack of cooperation and failure to provide substantial evidence or material to support their claims. Despite multiple opportunities, the appellant did not actively participate in the proceedings, resulting in the confirmation of the addition of income and dismissal of the appeal.

This detailed analysis of the judgment highlights the key issues involved in the case, the arguments presented by the parties, and the conclusions reached by the authorities and tribunal based on the evidence and legal principles applied.

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