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Judgment
PER S.RIFAUR RAHMAN,AM:
The assessee has filed appeal against the order of the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi [“Ld. CIT(A)”, for short] dated 17.10.2025 for the Assessment Year 2017-18.
Brief facts of the case are, assessment proceedings under Income-tax Act, 1961 (for short ‘the Act’) were initiated on the basis of information that assessee has deposited cash amounting to Rs.23,00,000/- in his bank account maintained with Dena Bank, G.B. Road, Shradhanand Marg, Delhi during the AY 2017-18 and had not filed return of income for the same year. Based on the above information, notices under section 142(1) of the Act were issued and served on the assessee but since there was not compliance from the assessee for furnishing the details of return of income, accordingly, final notice u/s 144 of the Act was issued to the assessee to comply to the various notices issued u/s 142(1) of the Act still there was no compliance from the assessee. Further, AO observed that only in one occasion, Shri Tarun Rastogi had attended for the notice issued u/s 131 of the Act and in response to further notices u/s 142(1), there was no compliance from the assessee side. Accordingly, the AO further gathered information from Dena Bank and noticed that assessee has deposited total cash of Rs.1,74,53,920/- and total credit other than cash during the year amounts to Rs.2,54,87,586/-. Since there was no compliance from the assessee, the AO proceeded to make the total cash deposit of Rs.1,74,53,920/-u/s 69A of the Act. Since assessee has not filed any return of income, the AO proceeded to make further addition of 10% of the total credits other than cash was added to the total income of the assessee i.e. to the extent of Rs.25,48,758/-.
Aggrieved with the above order, assessee preferred an appeal before the NFAC, Delhi and filed detailed relevant appeal with a delay of 26 days. Ld. CIT (A) dismissed the appeal of the assessee in limine.
Aggrieved with the above order, assessee is in appeal before us raising following grounds of appeal :-
“1.That the order passed under Section 144 of the Act is further illegal and not tenable under the law because Sh. Tarun Rastogi had duly appeared before the Ld. AO in compliance to summons issued under Section 131 of the Act and narrated the facts related to the case, however, no cognizance of the same was taken while completing the assessment proceedings
2.That the appellant seeks leave to amend, alter, change any grounds of appeal OR take any further ground at any time even during the course of hearing of instant appeal
3.That the orders passed by Ld. AO u/s 143(3) r.w.s. 144B of the Act as well as appellate order passed by Ld. CIT(A) are bad in law and are passed in contravention of prevailing law as well as facts of the case, therefore liable to be annulled.
4.That Ld. CIT(A) grossly erred in law and in facts of the case in dismissing the appeal of assessee by not condoning the delay of 26 days in filing of appeal.
5.That the Ld. AO grossly erred in law in making additions of Rs.1,74,53,9201- to the income of the assessee by invoking Sec. 69A of the Act.
6.That the addition of Rs.25,48,758/- made to the income of the assessee is further illegal and not tenable because the credits appearing in the bank statement were duly recorded in the books of account of Sh. Tarun Rastogi and income therefrom was duly offered for tax.”
At the time of hearing, ld. AR of the assessee submitted that assessee is a partnership firm and during the year under consideration, one of the main partners expired and he agreed that there was no compliance during assessment proceedings and assessment was completed u/s 144 and ld. CIT (A) has not condoned the delay of 26 days and not appreciated the reasonable cause for delay in filing the appeal before him and also not decided the appeal on merits. He prayed that the matter may be restored back to the AO.
On the other hand, ld. DR of the Revenue submitted that there was absolutely no compliance from the assessee side and he relied on the findings of the lower authorities.
Considered the rival submissions and perused the material on record. We observed that there is no doubt that the assessee has not pursued the matter before the lower authorities. We further observed that ld. CIT (A) dismissed the appeal in limine by not condoning the delay in filing the appeal. Upon careful consideration and in the interest of justice, we condone the delay in filing the appeal before the ld. CIT (A). We are of the considered view that the matter requires denovo assessment and accordingly, we remit back the issues to the file of the Assessing Officer with the directions to decide the same afresh, after giving adequate opportunity of being heard to the assessee, for which Ld. DR has no objection. Assessee is directed through his counsel to fully cooperate with the AO during the proceedings. We hold and direct accordingly.
In the result, the appeal filed by the assessee is allowed for statistical purposes.