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Facts
The assessee, running a transport firm, failed to file an income tax return for AY 2017-18 after a notice under Section 142(1) was issued. The AO completed the assessment ex-parte under Section 144, making significant additions. The NFAC also dismissed the assessee's appeal.
Held
The Tribunal restored the issue to the NFAC, granting the assessee one opportunity to present their case, considering the ex-parte nature of the orders and the interest of justice. The assessee is directed to appear before the NFAC.
Key Issues
Whether the ex-parte assessment order and subsequent NFAC order should be set aside to grant the assessee an opportunity to present their case, considering the grounds of appeal and interest of justice.
Sections Cited
144, 142(1), 69A, 115BBE, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “A”, DELHI
Before: SH. M. BALAGANESH & SH. SUDHIR KUMAR
ORDER PER SUDHIR KUMAR, JUDICIAL MEMBER:
This appeal by the assessee is directed against the order of the National Faceless Appeal Centre [hereinafter referred to as “NFAC”] vide order dated 25.10.2024 pertaining to A.Y. 2017-18 arising out the assessment order dated 31.12.2019 under section 144 of the Income Tax Act, 1961, (in short ‘the Act’).
The assessee has raised the following grounds in appeal:
That the Ld. CIT(A) vide impugned order passed u/s. 250 dated 25.10.2024 erred in sustaining the impugned additions amounting to Rs.26,43,500/- u/s. 69A/115BBE (on a/c of stated cash deposit) and Rs.34,29,421/- (on a/c of alleged net profit of BUSINESS) made in the impugned assessment order passed u/s. 144 of “1961” Act dated 31.12.2019 which are patently unlawful on face of it; (B) That Ld. CIT(A) vide impugned order passed u/s. 250 dated 25.10.2024 erred in not quashing the impugned assessment order dated 31.12.2019 passed u/s.144, which is nullity and is void ab initio and unlawful and is passed without authority of law. (c) That the Ld. CIT(A) vide impugned order passed u/s. 250 dated 25.10.2024 erred in not quashing the impugned assessment order passed u/s. 144 of “1961” Act dated 31.12.2019 which is passed in totally “ARBITRARY” manner without any application of mind much less independent application of mind.
The brief facts of the case are that the assessee is running a transport firm in the name and style of Amarpal and filing his return of income regularly except A.Y. 2017-18. A notice u/s 142(1) of the Act was issued on 21-02-2018 to the assessee calling to file a true and correct return of income for the A.Y.2017-18. The assessee failed to file the return of income in the compliance of the notice for the A.Y. 2017-18. The assessee did not appear before the AO and the AO completed the assessment u/s 144 of the Act and assessed the income of Rs. 60,72,920/-.
Aggrieved by the order of the AO, the assessee preferred an appeal before the Ld. NFAC who vide order dated 25-10-2014 dismissed the appeal against which the assessee is in appeal before the tribunal.
The Ld. Counsel for the assessee submitted that the notice dated 21-02-2018 issued u/s 142 of the Act is invalid. The AO has wrongly applied the 16% profit on the entire cash deposits.
The Ld. DR has submitted that the assessee did not appear before the lower authorities. The assessee not submitted any documents before the AO. He relied the orders of the below authorities.
We have heard the parties and perused the material available on record. It is admitted fact that despite opportunities granted by the A.O. as well as the Ld. NFAC the assessee did not appear before either of the authorities for which ex-parte orders have passed by the A.O.as well as the Ld. NFAC.
Since in the instant case the Ld. NFAC has dismissed the appeal for want of prosecution, therefore, considering the totality of the facts and circumstances of the case and in the interest of justice and fair play, we deem fit proper to restore the issue to the file of the Ld. NFAC to grant one opportunity to the assessee to substantiate its claim and decide the issue as per fact and law. The assessee is also directed to appear before the Ld. NFAC to substantiate his case. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purpose.
Order pronounced in the open court on 06.08.2025.