VED PRAKASH JALLAN RAKESH JALLAN,BANGALORE vs. DCIT, NON CORPORATE CIRCLE-1, MADURAI

The brief facts of the case are that the assessee filed his return of income u/s. 139(1) of the Act declaring total income of Rs. 2,34,490/-. The revenue was in possession of an information w.r.t. the claim of exemption u/s. 10(38) of the Act made by the assessee through trading in penny scrip in the case of M/s. Jackson Investments Ltd. during the year under consideration for a value of Rs. 46,51,500/-. Based on the same a notice u/s. 148 of the Act was issued vide dated: 31.03.2021, but no return in compliance to the same was filed and there was no response by the assessee against the various notices issued u/s. 142(1) and 144 of the Act. As per the assessment order no positive response was there from the assessee and the assessment order was substantially in the nature of an ex-parte order. Ultimately, the case of the assessee was assessed u/s. 147 r.w.s. 144B of the Act after making addition of Rs. 46, 51,500/- u/s. 69A of the Act.

The assessee being aggrieved with the same preferred an appeal before the Ld. CIT (A), who in turn dismissed the appeal of the assessee in limine on the ground of non-participation. The assessee being further aggrieved preferred the present appeal before us. We have gone through the order of the AO, order of the Ld. CIT (A) and submissions of the assessee alongwith grounds taken before us. It is observed that the assessee never came forward with a plausible explanation and evidence to substantiate his claim u/s. 10(38) of the Act. Moreover, despite of five opportunities by the Ld. CIT (A) as mentioned in para 4.1 of the Ld. CIT (A)’s order,

As observed (supra) the overall scenario before us is to deal with an ex-parte order and not a substantive order by the authorities below. Being a final fact finding authority, the endeavour of this Tribunal is to deal with the matter decided on merits and applicable Law. As mentioned (supra), the overall conduct of the assessee is not appreciable, but still as a matter of fair and last chance to the assessee and the Revenue, we restore the matter back to the file of Ld. CIT (A) with a direction to re- hear the matter of the assessee after giving the assessee a proper opportunity of being heard as prescribed in section 282 of the Act. The assessee is also directed in the light of above observations to actively participate in the proceedings before the Ld. CIT (A) with full cooperation and vigilance without seeking any adjournment with plausible explanation and evidence. In view of the above observations and directions, grounds raised by the assessee is allowed for statistical purposes only. 5. In the Result, the appeal of the assessee is allowed for statistical purposes only in above terms. Order pronounced on the 18th day of August, 2026, in Chennai. Sd/- Sd/- (यस. यस. विश्वनेत्र रवि) (गगन गोयल) (S.S. VISWANETHRA RAVI) (GAGAN GOYAL) न्याययक सदस्य/JUDICIAL MEMBER लेखा सदस्य/ACCOUNTANT MEMBER चेन्नई/Chennai, ददनाांक/Dated: 18th August, 2026. KB आदेश की प्रयतललपप अग्रेपषत/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT, Chennai /Madurai/Coimbatore/Salem 4. पवभागीय प्रयतयनधि/DR K Digitally signed 5. गार्ड फाईल/GF by K BABU BABU Date: 2026.08.24 14:48:44 +05'30'