In case of non-filer notice u/s 143(2) not mandatory and notice issued u/s 142(1) is sufficient – ITAT
In a recent case, the ITAT Guwahati has held that in case of non-filer notice u/s 143(2) not mandatory and notice issued u/s 142(1) is sufficient
ABCAUS Case Law Citation:
ABCAUS 4028 (2024) (05) ITAT
In the instant case, the assessee had challenged the order passed by the CIT(A), National Faceless Appeal Centre (NFAC) confirming the addition of unexplained cash deposit made by the Assessing Officer (AO).
The appellant assessee was a non-filer. For the year under consideration based on information available on ITBA portal, the AO observed that assessee had deposited a large sum of cash in his bank account during the demonetization period.
The AO issued notice u/s. 142(1) calling the assessee for filing his return. However, no return was filed by the assessee in compliance to the said notice. Subsequently, notice u/s 133(6) of the Act was issued on the assessee for furnishing of information and documents in respect of deposit of cash in the bank account. Again, no information or documents were furnished by the assessee in compliance in this respect.
Assessment was then completed u/s. 144 of the Act wherein additions were made on two counts. First being 10% of the total cash deposit in the bank account taking it as turnover and applying a net profit rate of 10% u/s. 44AD of the Act. Second being as unexplained money for an amount deposited during the demonetization period after giving credit for average sales worked out by the AO.
The CIT(A) while partly allowing the appeal of the assessee, merely gave direction to the AO with certain remarks.
Before the Tribunal the assessee asserted that no mandatory notice u/s 143(2) had been issued and served on the assessee leading to the impugned assessment order as void ab initio.
However, the Tribunal expressed agreement with the contention of the Revenue that since the assessee was a non-filer and notice was issued u/s 142(1) which was sufficient as required under the provisions of the Act and, therefore, issue raised by the assessee had no legs to stand.
On the merits of the case, the Tribunal noted that CIT(A) had not gone into the facts of the case and has merely given certain directions with remarks for the AO to work upon and pass the assessment order.
The Tribunal observed that as per Section 250(6) of the Act, the order of Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision, which was not so in the present case.
Accordingly, the impugned order of the CIT(A) was set aside and the appeal was restored back to him with the direction to pass a speaking order by going through the statements of facts as well as oral/written submissions/documents, if any, filed by the assessee.
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