ANIRBAN ASIM KUNDU,MUMBAI vs. ACIT, CIRCLE 1(1), KOLKATA, KOLKATA

For that the order dated March 10, 2026 passed by the CIT(A) is erroneous on facts and/or in law.

For that the CIT(A) erred in deciding the appeal without granting the assessee any opportunity of hearing and the said order dated March 10, 2026 is illegal, invalid, bad in law as the said order was passed in gross violation of the principles of natural justice.

For that further and in any event and without prejudice to the aforesaid the CIT(A) erred in setting aside the assessment order and referred the matter back to the Assessing Officer on the ground that the said assessment order was passed under section 144 of the Act and the purported findings in this regard are arbitrary, unreasonable and perverse.

For that the CIT(A) failed to appreciate that the said assessment order was passed under section 147 read with section 144C and not under section 144 of the Act and the CIT(A) did not have any authority in law to remand the matter before the Assessing Officer and the said order is illegal, invalid, bad in law and perverse.

For that further and in any event and without prejudice to the aforesaid the CIT(A) in holding that the Assessing Officer at Kolkata had the jurisdiction to assess and the said purported findings are arbitrary, unreasonable and perverse.

For that the CIT(A) failed to consider that before the alleged transfer of jurisdiction from the Assessing Officer at Mumbai to Assessing Officer at Kolkata, no notice under section 127 of the Act was served on the assessee, which is sine-qua-non for transferring the jurisdiction from one Assessing Officer to another under section 127 of the Income Tax Act, 1961 (in short "the Act") and without granting any opportunity of hearing and the said alleged transfer of jurisdiction is illegal, invalid and bad in law.

For that further and in any event and without prejudice to the aforesaid, the CIT(A) failed to consider/deal with the grounds of appeals urged by the assessee before him in respect of jurisdiction of the Assessing Officer as well as on merits of the case and the said order dated March 10, 2026 is arbitrary, unreasonable and perverse.

For that the CIT(A) should have dealt with the appeal filed by the assessee on merits without setting aside the assessment order and sent it back to the Assessing Officer and the said order dated March 10, 2026 is illegal, invalid, bad in law and is liable to be set aside.

For that further and in any event and without prejudice to the aforesaid, the CIT(A) was not right in not dealing with the application for additional ground filed by the assessee before deciding the appeal filed by the assessee.

Brief facts of the case are that the assessee had filed the return of income for AY 2016-17 on 24.04.2023 declaring the total income at ₹92,250/-. The Assessing Officer (hereinafter referred to as Ld. 'AO') noted that the assessee had purchased an immovable property worth ₹1,11,30,250/- and bonds worth ₹40,00,000/- during FY 2015-16. Consequently, the Ld. AO framed the assessment u/s 147 r.w.s. 144C(3) of the Act determining the total income at ₹16,22,500/- by making an addition of ₹15,30,250/- as unexplained investment in the immovable property treated as a gift u/s 56(2)(vii) of the Act. Aggrieved with the assessment order, the assessee filed an appeal before the Ld. CIT(A), who observed that the assessment order was passed ex parte without granting a fair opportunity of hearing, thus violating the principles of natural justice. Therefore, the Ld. CIT(A) referred the case back to the file of the Ld. AO for making a fresh assessment after affording adequate opportunity of being heard to the assessee. Accordingly, the Ld. CIT(A) modified the action of the Ld. AO and partly allowed the appeal of the assessee vide his findings as under: “Discussions and Findings:- I have duly examined the material hand including the impugned order and submissions of the Appellant as placed with facts and reasoning. The appellant's objection regarding the jurisdiction of the case cannot be accepted, as it is seen from the system records that the jurisdiction was transferred from Mumbai to Circle 1(1), Kolkata. Therefore, the AO had the jurisdiction to pass the order. Accordingly, the action of the AO is upheld. However, it is observed that the order was passed ex parte under section 144 of the Income-tax Act, 1961. The principles of natural justice demand that there should be a fair determination of a question by a quasi-judicial authority. It is a settled position of law that the principles of natural justice and fair play require that the affected party be granted sufficient opportunity of being heard to contest his case. Therefore, without delving into merits of the case, in the interest of justice, I Set aside the assessment order and refer the case back to the file of assessing officer for making a fresh assessment. The AO shall pass a speaking order after affording adequate opportunity of being heard to the appellant, who in turn, may also contest his stand forthwith.

Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal.

Rival contentions were heard and the submissions made have been examined. It was submitted by the Ld. AR that the assessee is an NRI and the assessment was made u/s 147/144C of the Act. The Ld. CIT(A) referred the provisions of section 251(1)(a) of the Act and the proviso thereof and remanded the matter to the Ld. AO. However, the Ld. AR submitted that it was not a best judgement assessment order u/s 144 of the Act of the Act and the proviso to clause (a) of sub-section (1) of section 251 of the Act was not applicable. He requested that the order of the Ld. CIT(A) may be set aside and the appeal may be restored before him to adjudicate the grounds of appeal raised before him.

The Ld. THE LD. DR, though relied upon the order of the Ld. CIT(A), but did not raise any serious objection if the appeal is restored before the Ld. CIT(A).

We have considered the submissions made, gone through the facts of the case and perused the record and the order of the Ld. CIT(A). It is evident that the Ld. CIT(A) did not decide the appeal on merits and merely set aside the order before the Ld. AO which can only be set aside if it is a best judgement order passed u/s 144 of the Act and which is not the case here. Hence, after examining the facts of the case and the ITA No(s). 1912/KOL/2026 Assessment Year(s) 2016-17 law, we deem it appropriate to set aside the order of the Ld. CIT(A) and restore the appeal before him for disposal of the grounds of appeal taken by the assessee on merit by passing a speaking order. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any further submission he wants to make in support of his grounds of appeal and shall not seek unnecessary adjournments and rule 46A of the I.T. Rules, 1962 shall also be followed and an opportunity of being heard may be provided to the Ld. AO as well. Accordingly, Ground Nos. 3 and 4 are allowed. Ground No. 6 is dismissed as the order u/s 127 of the Act is not mentioned as an appealable order before the Tribunal under section 253 of the Act and all other grounds taken by the assessee in the appeal are partly allowed for statistical purposes.

In the result, the appeal filed by the assessee is partly allowed for statistical purposes. Order pronounced in the open Court on 2nd September, 2026. [George Mathan] [Rakesh Mishra] Judicial Member Accountant Member Dated: 02.09.2026 Bidhan (Sr. P.S.)