ITAT Remands Ex-Parte Assessment After Accepting Assessee’s Lack of Knowledge Due to Inaccessible Email IDs:

The assessee was subjected to reassessment proceedings under Section 147 read with Sections 144 and 144B of the Income Tax Act, 1961, for AY 2016-17. The AO had information indicating the purchase of immovable property worth Rs. 56,03,142 during FY 2015-16 and alleged contract receipts of Rs. 21,20,183 from M/s Tricon Infra Buildtech Pvt. Ltd.

Since the assessee did not respond to the notices issued during the assessment proceedings, the AO completed the assessment on a best-judgment basis and made additions aggregating to Rs. 77,23,325, comprising Rs. 56,03,142 under Section 69 and Rs. 21,20,183 under Section 69A of the Act. The CIT(A) rejected the explanation for lack of sufficient supporting particulars and dismissed the appeal without examining the merits of the case.

The Tribunal observed that the explanation for the assessee's non-compliance and subsequent delay was her lack of knowledge of the assessment proceedings, as the notices had been served electronically at email addresses that were not accessible to her at the relevant time. The Tribunal noted that the additions had been made against the assessee merely because of her failure to comply with the assessment notices, without any corresponding finding establishing that income had actually escaped assessment in her hands.

Accordingly, in the interest of justice, the Tribunal considered it appropriate to restore the matter to the file of the AO to enable the assessee to furnish the necessary evidence and demonstrate that there was no escapement of income in respect of the property investment and alleged contract receipts. The Tribunal accordingly allowed the appeal for statistical purposes.