2023 (1) TMI 168 - AT - Income Tax

Ex parte assessment order u/s 144 - unexplained cash credits, share capital along with share premium - HELD THAT - It is to be noted that on being asked the assessee to explain in this respect, neither anyone appeared on behalf of the assessee nor furnished any details. AO proceeded to frame the assessment considering that the assessee has not furnished any details, documents whatsoever in respect of aforesaid claim of share application and share premium. Assessing Officer, under the circumstances, treated the said amount as unexplained income of the assessee and made the impugned addition by framing ex parte assessment order u/s 144 of the Act. Assessee preferred appeal before the ld. CIT(A). Even before the ld. CIT(A), no one appeared on behalf of the assessee and since neither anyone appeared nor furnished any details, the ld. CIT(A), under the circumstances, upheld the order of the Assessing Officer. Before us, no power of attorney was filed by any counsel. However, as observed above, one Ms. Trisha Lahiri had appeared and sought adjournment. When she was directed to furnish the identity, details, address of the assessee etc., she disappeared and thereafter, no one has attended the hearing. As observed above, neither any document or details has been furnished before the Assessing Officer nor before the CIT(A) and even before us neither anyone has appeared nor any details furnished, we do not find any reason to interfere with the order of the Assessing Officer and the same is upheld. Appeal of the assessee is hereby dismissed.

Issues:
1. Appeal against order of CIT(A) under Income Tax Act
2. Ex parte order by Assessing Officer
3. Addition of unexplained cash credits
4. Penalty proceedings under Income Tax Act

Issue 1: Appeal against order of CIT(A) under Income Tax Act
The appellant filed an appeal against the order of the Commissioner of Income Tax (Appeals)-18, Kolkata, challenging the decision passed under section 250 of the Income Tax Act. The grounds of appeal included contentions that the Assessing Officer's order was arbitrary, illegal, and unjustified. The appellant also argued that the CIT(A) erred in passing an ex parte order without providing sufficient time for representation.

Issue 2: Ex parte order by Assessing Officer
The Tribunal noted that the Assessing Officer had made additions on account of unexplained cash credits related to share capital and share premium. Despite being asked to explain, the appellant failed to appear or provide any details. Consequently, the Assessing Officer proceeded with an ex parte assessment under section 144 of the Act. The Tribunal observed that the appellant did not come to court with clean hands and upheld the Assessing Officer's decision due to the lack of cooperation from the appellant.

Issue 3: Addition of unexplained cash credits
The Assessing Officer had added Rs. 1,41,00,000 as unexplained cash credits under section 68 of the Income Tax Act, comprising share capital and securities premium. Since the appellant did not offer any explanations or documents, the Assessing Officer treated the amount as unexplained income and made the addition through an ex parte assessment order.

Issue 4: Penalty proceedings under Income Tax Act
The Assessing Officer had initiated penalty proceedings under sections 271(1)(b) and 271(1)(c) of the Income Tax Act. However, as the appellant did not provide any details or attend the proceedings, the penalty proceedings were not specifically addressed in the Tribunal's decision.

In conclusion, the Tribunal dismissed the appeal of the appellant on the grounds of non-cooperation and lack of evidence or representation throughout the proceedings. The decision highlighted the importance of full disclosure and active participation in tax proceedings to ensure a fair and just outcome.

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