ARJUN ALLOYS,AHMEDABAD, GUJARAT vs. ITO WARD 3(2)(1), INCOME TAX BUILDING VEJALPUR, AHMEDABAD

PER ANNAPURNA GUPTA, AM:

The present appeal has been filed by the Assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “CIT(A)”) dated 07.07.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”).

ITA No.2035/Ahd/2025 Arjun Alloys - 2 – 2. The Grounds of appeal raised by the assessee reads as under:- 1. Violation of Principles of Natural Justice The learned CIT(A), NFAC, has erred in dismissing the appeal ex parte without affording a reasonable and effective opportunity of being heard, particularly when the appellant could not attend the proceedings owing to DRT proceedings, bankruptcy, and non-receipt of initial hearing notices. The order is bad in law and liable to be set aside. 2.Non Adjudication on Merits The learned CIT(A) erred in not adjudicating the issues raised on merits in respect of (a) Disallowance of investment written off of Rs. 3,21,92,926 (b) Addition on account of squaring off unsecured loans of Rs. 1,02,15,981 (c) Addition under section 68 for Rs. 3,95,64,906 without appreciating the documentary evidences already filed during assessment and earlier appellate stages. 3.Ex Parte Dismissal Without Application of Mind The order of the CIT(A) is a non-speaking order passed mechanically without examining the factual and legal merits of the case which renders it invalid and unsustainable in law. 4.Request for Restoration to CIT(A) The appellant prays that the Honble Tribunal may be pleased to set aside the impugned order - and remand the matter to the learned CIT(A) for fresh adjudication after granting the appellant a fair and reasonable opportunity to represent the case. 5.General The appellant craves leave to add, alter, amend OR withdraw any of the above grounds of appeal at the time of hearing. 3. None appeared on behalf of the assessee before us. We have gone through the documents placed on record before us, which includes an application filed by the assessee seeking condonation of the delay in filing of the present appeal before us, which the Registry has noted to be a delay of 29 days. The delay has been explained to be on account of the fact that the assessee being a business venture was going through grave financial difficulties, having become bankrupt, and was facing litigations on several

ITA No.2035/Ahd/2025 Arjun Alloys - 3 – fronts, including the Debt Recovery Tribunal and the National Company Law Tribunal, and proceedings relating to bankruptcy. Even the financial position of the family members and sister concerns, associated with the assessee partnership firm and its members, had also deteriorated significantly, causing acute financial constraints and operational disruption. That the financial and legal constraints had resulted in a lot of distress to the partners of the assessee firm, who, as a result were suffering from health issues during the period the first appellate proceedings before the Ld. CIT(A) were going on. That due to the aforesaid adverse conditions prevailing the assessee had lost his access to his Office and for the aforesaid reasons the present appeal was delayed for filing by 29 days. 5. We have also gone through the order of Ld. CIT(A), and we have noted that the order was passed ex parte, with nobody appearing on behalf of the assessee. The contents of the assessment order reveal that while the assessee had filed NIL return of income, the addition made however, was to the tune of Rs.8,19,73,813/-, on account of following:- i) disallowance of investment written off Rs.3,21,92,926/- ii) squaring off the unsecured loan without actual payment Rs.1,02,15,981/- iii) unexplained credit u/s 68 of the Act, on account of squaring off of debtors without receipt of payment of Rs.3,95,64,906/- iv) totaling of Rs.8,19,73,813/-

ITA No.2035/Ahd/2025 Arjun Alloys - 4 – 6. Considering all of the above, we are of the view that, there were sufficient reasons on account of the prevailing financial distress which the assessee was facing, that resulted in the first appellate proceedings not being participated in by the assessee, and even the delay in filing of appeal before us of 29 days. 7. We are of the view, that the delay in the present appeal needs to be condoned, so as to meet the interest of justice, since, the assessee would be gravely prejudiced, if the delay is not condoned as, it would result in huge additions made to its income to the addition of Rs.8,19,73,813/- being confirmed without hearing the assessee at all. Accordingly, the delay in filing of the present appeal before us of 29 days is condoned, and since, assessee’s appeal has been decided ex parte by the Ld. CIT(A), we restore the appeal back to the file of Ld. CIT(A), to decide it afresh, after giving due opportunity of hearing to the assessee. The assessee is directed to participate in the proceedings and not to abuse the process of law. 8. In effect, the appeal of the assessee is allowed for statistical purposes. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 14.07.2026

Sd/- sd/- (SANJAY GARG) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 14/07/2026 Mittali आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant

ITA No.2035/Ahd/2025 Arjun Alloys - 5 – 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)- 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad