ITO, LUDHIANA vs. RAKESH BHATIA, LUDHIANA

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ITA 151/CHANDI/2026Status: DisposedITAT Chandigarh30 July 2026AY 2017-184 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order, stating that setting aside an ex parte assessment and remanding it for a fresh assessment with an opportunity for the assessee to present their case is in line with natural justice principles.

What were the facts?

The assessment was completed ex parte under section 147 read with section 144 of the Income Tax Act due to the assessee's non-compliance. The CIT(A) set aside this assessment and restored the matter to the Assessing Officer for a de novo assessment.

What were the issues?

Whether the CIT(A) was justified in setting aside an ex parte assessment order and remanding the case back to the Assessing Officer for de novo assessment.

Which sections of the Income-tax Act were involved?

Section 147,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DIVISION BENCH, ‘B’ CHANDIGARH

Before: SHRI LALIET KUMAR & SHRI MANOJ KUMAR AGGARWAL

For Appellant: Shri Sham Lal Sabharwal, Advocate
For Respondent: Smt. Kusum Bansal, Pr.CIT, DR
Hearing: 29.07.2026Pronounced: 30.07.2026

Heard together (2 matters)

ITA No. 151/CHD/2026
C.O. No. 17/CHD/2026

Read from the judgment's own cause title. This page is filed under one of them.

आयकर अपील�य अ�धकरण,च�डीगढ़ �यायपीठ, च�डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, ‘B’ CHANDIGARH BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 151/CHD/2026 �नधा�रण वष� / Assessment Year: 2017-18 The ITO, Shri Rakesh Bhatia, Aayakar Bhawan, Vs House No. B-34/230, Rishi Nagar, Ludhiana. Inder Vihar, Chander Nagar, Ludhiana. �थायी लेखा सं./PAN NO: ABVPB3209Q अपीलाथ�/Appellant ��यथ�/Respondent & C.O. No. 17/CHD/2026 in आयकर अपील सं./ ITA No. 151/CHD/2026 �नधा�रण वष� / Assessment Year: 2017-18 Shri Rakesh Bhatia, The ITO, House No. B-34/230, Vs Aayakar Bhawan, Inder Vihar, Chander Nagar, Rishi Nagar, Ludhiana. Ludhiana. �थायी लेखा सं./PAN NO: ABVPB3209Q अपीलाथ�/Appellant ��यथ�/Respondent Assessee by : Shri Sham Lal Sabharwal, Advocate Revenue by : Smt. Kusum Bansal, Pr.CIT, DR Date of Hearing : 29.07.2026 Date of Pronouncement : 30.07.2026 HYBRID HEARING O R D E R PER LALIET KUMAR, JM

The Revenue has filed the present appeal and the assessee has filed the Cross Objection (CO) against the order of the learned Commissioner of Income-tax (Appeals), whereby the learned

ITA No.151/CHD/2026 & C.O. 17/CHD/2026 A.Y.2017-18 2 CIT(A), after noticing that the assessment had been completed ex parte under section 147 read with section 144 of the Act, set aside the assessment order and restored the matter to the file of the Assessing Officer for framing a de novo assessment after providing adequate opportunity of hearing to the assessee and permitting it to furnish the necessary documentary evidence.

2.

The learned Departmental Representative relied upon the assessment order and submitted that the learned CIT(A) was not justified in setting aside the assessment and remanding the matter to the file of the Assessing Officer. It was accordingly prayed that the order of the Assessing Officer be restored.

3.

Per contra, the learned Authorised Representative for the assessee supported the impugned order of the learned CIT(A). It was submitted that the assessment had admittedly been framed ex parte and, therefore, the learned CIT(A) had rightly restored the matter to the file of the Assessing Officer in the interest of justice after affording the assessee an effective opportunity to explain its case. It was accordingly prayed that the appeal of the Revenue be dismissed and the Cross Objection be disposed of accordingly.

4.

We have heard the rival submissions and perused the material available on record. It is an undisputed fact that the assessment was completed ex parte for want of compliance by the

ITA No.151/CHD/2026 & C.O. 17/CHD/2026 A.Y.2017-18 3 assessee. Taking note of this factual position, the learned CIT(A) found that the assessee deserved one more effective opportunity to present its case and, accordingly, set aside the assessment with a direction to the Assessing Officer to frame a fresh assessment after granting adequate opportunity of hearing and considering the evidence that may be produced by the assessee.

5.

In our considered opinion, the approach adopted by the learned CIT(A) is in consonance with the principles of natural justice. Once the assessment has been framed ex parte, no fault can be found with the action of the learned CIT(A) in restoring the matter to the file of the Assessing Officer so that the issues may be adjudicated afresh after granting due opportunity to the assessee.

6.

The Revenue has not been able to point out any legal or factual infirmity in the impugned order warranting our interference. We, therefore, uphold the order of the learned CIT(A). However, it is clarified that while giving effect to the directions of the learned CIT(A), the Assessing Officer shall provide adequate and effective opportunity of hearing to the assessee, permit it to file such documentary evidence as may be considered necessary, and thereafter pass a fresh speaking order in accordance with law.

ITA No.151/CHD/2026 & C.O. 17/CHD/2026 A.Y.2017-18 4 Accordingly, finding no merit in the appeal preferred by the Revenue, the same is dismissed. Since the Cross Objection filed by the assessee merely supports the order of the learned CIT(A), the same also stands dismissed as infructuous.

7.

In the result, the appeal of the Revenue is dismissed and the Cross Objection of the assessee is also dismissed.

Order pronounced on 30th July,2026.

Sd/- Sd/-

(MANOJ KUMAR AGGARWAL) (LALIET KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER “Poonam” आदेश क� �ितिलिप अ�ेिषत/ Copy of the order forwarded to : अपीलाथ�/ The Appellant 1. ��यथ�/ The Respondent 2. आयकर आयु�/ CIT 3. िवभागीय �ितिनिध, आयकर अपीलीय आिधकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 4. गाड� फाईल/ Guard File 5.

सहायक पंजीकार/ Assistant Registrar

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