Om Prakash , New Delhi vs Department Of Income Tax

Income Tax Officer, Vs. Shri Om Prakash, Ward- Ward-29(1), Prop. M/s Lord Krishna Dye Chem, Room No.103, 2165, Gali No.16, Ram Nagar, Drum Shape Building, Building, Shahdara, New Delhi. Delhi - 110 009. PAN : AAOPP7013N.

(Appellant) (Respondent)

Cross Objection No.18/Del/2013 No.18/Del/2013 Assessment Year : 2007- 2007-08

Shri Shri Om Prakash, Vs. Income Tax Officer, Prop. M/s Lord Krishna Ward- Ward-29(1), Dye Chem, Room No.103, 2165, Gali No.16, Drum Shape Building, Ram Nagar, Shahdara, New Delhi. Delhi - 110 009. PAN : AAOPP7013N.

(Appellant) (Respondent)

Revenue by : Shri P. Dam Kanunjha, Sr.DR. Assessee by : Shri Nitin Mehrotra and Shri Vinay Mehrotra, CAs.

Date of hearing : 12.03.2015 Date of pronouncement : 01.04.2015 2 ITA-1133/D/2012 & C.O.18/D/2013

ORDER

PER G.C. GUPTA, GUPTA, VP :

The appeal by the Revenue and the cross-objection by the assessee for the assessment year 2007-08 are directed against the order of learned CIT(A)-XXV, New Delhi dated 9th December, 2011.

ITA No.1133/Del/2012 - Revenue's appeal :- :-

2. The only ground of appeal raised by the Revenue is as under:-

"On the facts and in the circumstances of the case, the ld.CIT(A) XXV, New Delhi has erred in deleting addition of `10,96,000/- made by AO, specifically on account of unexplained cash deposits in bank account."

3. Learned DR submitted that the assessee has not cooperated with the department in the matter of its assessment and a number of opportunities were given to the assessee at the time of assessment by issuing notice under Section 143(2)/142(1) of the Income-tax Act, 1961 and even summons under Section 131 of the Act were issued to the assessee. He submitted that none attended on behalf of the assessee. In these facts, the assessment was framed ex-parte under Section 144 of the Act. He submitted that the learned CIT(A) has allowed relief to the assessee without even calling for the remand report in the matter. He submitted that it is a clear case of violation of principles of natural justice and, accordingly, the order of learned CIT(A) may be set aside and that of the Assessing Officer should be restored.

4. Learned counsel for the assessee referred to paragraph 3.4 of the appellate order passed by the learned CIT(A) in support of the case of the assessee. He submitted that the addition was made for cash deposits in the bank, which were, in fact, cash sales and out of sale of 3 ITA-1133/D/2012 & C.O.18/D/2013

jewellery and ad-hoc disallowance was also made out of expenses claimed by the assessee which were normal business expenses. He relied on the order of learned CIT(A).

5. We have considered the rival submissions and have perused the order of the Assessing Officer and the CIT(A). We find that the Assessing Officer has allowed a number of opportunities to the assessee by issue of notice of hearing under Section 143(2)/142(1) and also summons under Section 131 along with final opportunity letters were issued to the assessee and still, none attended on behalf of the assessee before the Assessing Officer. In these facts, the Assessing Officer was left with no alternative but to pass ex parte assessment order under Section 144. We find that the learned CIT(A) allowed the relief to the extent of `10.96 lakhs without even calling for the remand report from the assessee. In our view, even if the claim of the assessee that the cash deposit in the bank account represents cash sales, still the learned CIT(A) should have allowed the Assessing Officer opportunity to file its comments in the form of remand report. In these facts, we are of the view that it shall be reasonable to set aside the orders of learned CIT(A) and the Assessing Officer to the file of the Assessing Officer with the direction to frame de novo assessment in accordance with law after allowing reasonable opportunity of hearing. The assessee shall be at liberty to file any evidence in support of its claim made before the Assessing Officer. The Assessing Officer shall pass a speaking order on the issue before him. We direct accordingly.

Assessee's Cross-

Cross-Objection No.18/Del/2013 :-

:-

6. The learned counsel for the assessee has not pressed the cross- objection of the assessee. We find that the cross-objection is also 4 ITA-1133/D/2012 & C.O.18/D/2013

delayed by around 260 days. However, in view of the withdrawal of the cross-objection by the assessee, we dismiss the same.

7. In the result, the appeal of the Revenue is allowed for statistical purposes and the cross-objection of the assessee is dismissed.

Decision pronounced in the open Court on 1st April, 2015.

Sd/- Sd/- (T.S. KAPOOR) KAPOOR) (G.C. (G.C. GUPTA) GUPTA) ACCOUNTANT MEMBER VICE PRESIDENT

VK.

Copy forwarded to: -

1. Assessee : Shri Om Prakash, Prop. M/s Lord Krishna Dye Chem, 2165, Gali No.16, Ram Nagar, Shahdara, Delhi - 110 009.

2. Revenue : Income Tax Officer, Ward- Ward-29(1),

Room No.103, Drum Shape Building, New Delhi.

3. CIT

4. CIT(A)

5. DR, ITAT

Assistant Registrar