Assessee claimed a third party fraudulently filed his return – ITAT remands case to prove it
In a recent judgment, the ITAT has remanded the case to provide an opportunity to the assessee to establish that third party fraudulently filed his return of income using his PAN.
ABCAUS Case Law Citation:
ABCAUS 3942 (2024) (04) ITAT
In the instant case, the assessee had challenged the order passed by the passed by the National Faceless Appeal Centre (NFAC).
For the assessment year under dispute, the assessee purportedly filed his return of income. The return of income, so filed, was processed by the Centralized Processing Centre, raising demand. Subsequently, assessee filed an appeal against the intimation issued u/s 143(1) of the Act.
While scrutinizing the appeal, filed by the assessee, the First Appellate Authority observed that the assessee had filed the appeal with inordinate delay of more than eight years and six months. Accordingly, he dismissed the appeal in limine without condoning the delay.
Before the Tribunal, the assessee took the ground that the CIT(A) erred in dismissing the appeal of the assessee on the ground of notional delay, when actually there was no service of demand notice and there was no delay in filing appeal. Also, that the CIT(A) erred in dismissing the appeal of the assessee on the ground that no FIR was lodged for the bogus ITR filed by someone.
The Tribunal observed that the specific case of the assessee, before the First Appellate Authority, was that during the relevant period he was working in USA and had no source of income in India. Therefore, he did not file any return of income in India for the assessment year under dispute.
It was the allegation of the assessee that some third party had fraudulently filed return of income in the name of the assessee by using his PAN. The assessee submitted that when refund of a subsequent year was adjusted against demand for the impugned assessment year, only then he came to know about intimation issued u/s 143(1) of the Act for impugned assessment year.
According to the assessee, he immediately took steps for obtaining the intimation u/s 143(1)
and thereafter filed an application u/s 154 before the Assessing Officer. However, since the said application remained pending, the assessee filed appeal before First Appellate Authority.
The Tribunal further observed that the assessee had filed a grievance application before the Assessing Officer, narrating the aforesaid facts. Further though assessee’s assessment jurisdiction and PAN was transferred, however, manual return of income was filed subsequently for the impugned assessment year, before the hitherto ITO.
The Tribunal opined that from the aforesaid facts, it appeared that there could be some truth in the statement of the assessee that some third party had fraudulently filed return of income for the impugned assessment year, which resulted in creation of demand against the assessee.
However, the Tribunal observed that at this stage, it was not in a position to record any conclusive factual finding on assessee’s claim of fraudulent filing of return of income, as this fact had to be established through proper inquiry and investigation, based on cogent material to be brought on record by the assessee.
With a view to provide an opportunity to the assessee to establish on record that the return of income subjected to proceedings u/s 143(1) of the Act by the Centralized Processing Centre was not filed by him, but somebody else, the Tribunal set aside the impugned order of First Appellate Authority and restored the issue to the file of the Assessing Officer for de novo adjudication, after providing due and reasonable opportunity of being heard to the assessee.
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