J N BHATT HUF,RAJKOT vs. ITO, WARD-1, JUNAGADH, RAJKOT

आयकर अपीलीय अिधकरण, राजकोट �यायपीठ, राजकोट। In The Income Tax Appellate Tribunal, Rajkot Bench, Rajkot Before Dr. Arjun Lal Saini, Accountant Member And Shri Sonjoy Sarma, Judicial Member

आयकर अपील सं./ITA No. 446/RJT/2026 [ �नधा�रण वष�/Assessment Year: 2017-18 ] J N Bhatt HUF Income Tax Officer, Ward-1, Block No.49/50, Shraddha Society, Aaykar Bhavan, Shakti Chamber, Vs. B/h. Bus Stand, Junagadh-362001, Junagadh-362001, Gujarat Gujarat �थायीलेखासं./जीआइआरसं./PAN/GIR No.: AAYPA1047R (अपीलाथ�/Appellant) (��यथ�/Respondent) Appellant by : Shri Mehul Ranpura, Ld. AR Respondent by : Shri Ganesh Iyer, Ld. Sr. DR Date of Hearing : 09/07/2026 Date of Pronouncement : 13/07/2026

:: ORDER :: Per, Shri Sonjoy Sarma, JM: Captioned appeal filed by the assessee, pertaining to assessment year (AY) 2017-18, is directed against the order under section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by the National Faceless Appeal Centre [in short ‘NFAC’], dated 08.01.2026, which in turn arises out of an assessment order passed by the Assessing Officer u/s 147 of the Act, dated 27.01.2025. 02. The brief facts of the case are that the assessee, an HUF, did not file its original return of income for the relevant assessment year. Subsequently, the case was reopened and notice under section 148 of the Income-tax Act, 1961 was issued. In response thereto, the assessee filed its return of income declaring a total income of

ITA No. 446/RJT/2026 J N Bhatt Hut v. ITO Rs.1,22,198. During the assessment proceedings, it was noticed that the assessee was engaged in executing contractual work of tile fitting and flooring for Gujarat State Electricity Corporation Limited. The assessee had executed a contract of Rs.8,14,650 and declared income under the presumptive provisions of section 44AD of the Act at Rs.1,22,198. The assessee also contended that, being covered under section 44AD, it was not required to maintain books of account. The Assessing Officer observed that during the relevant previous year the assessee had made cash deposits aggregating to Rs.6,51,300 and cash withdrawals aggregating to Rs.69,39,500. The assessee explained that the withdrawals were made out of unsecured loans received from M/s. J.N. Bhatt, a partnership firm. However, the Assessing Officer found that the alleged loans were not received through banking channels but otherwise than by account payee cheque, bank draft or electronic clearing system. The assessee failed to furnish satisfactory evidence regarding the source and mode of receipt of the advances amounting to Rs.57,30,000. Further, the assessee could not satisfactorily explain the source of funds amounting to Rs.34,88,500 stated to have been received from the partnership firm, M/s. J.N. Bhatt, in which the Karta of the assessee-HUF was a working partner. The Assessing Officer also recorded that neither the assessee nor the partnership firm maintained regular books of account and no satisfactory documentary evidence was produced to establish the genuineness and source of the transactions. Consequently, the Assessing Officer completed the assessment determining the total income at Rs.1,06,51,710. 03. Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). However, the learned CIT(A), on account of the assessee’s non- compliance on three consecutive dates of hearing, dismissed the appeal and sustained the additions made by the Assessing Officer.

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ITA No. 446/RJT/2026 J N Bhatt Hut v. ITO 04. Being further aggrieved, the assessee is in appeal before the Tribunal. At the time of hearing, the learned Authorised Representative submitted that the assessee could not appear before the learned CIT(A) due to non-receipt of the notices of hearing and prayed that one more opportunity may be granted to present its case on merits. The learned Departmental Representative supported the orders of the authorities below. 05. We have heard the rival submissions and perused the material available on record. It is noticed that the learned CIT(A) dismissed the appeal ex parte without adjudicating the issues on merits. Considering the principles of natural justice and fair play, we are of the view that the assessee deserves one more effective opportunity to substantiate its case before the first appellate authority. Accordingly, we set aside the impugned order of the learned CIT(A) and restore the matter to his file with a direction to adjudicate the appeal afresh on merits after providing the assessee with a reasonable opportunity of being heard. The assessee is also directed to extend full cooperation, comply with all notices issued by the learned CIT(A), and furnish the necessary evidence and explanations without seeking unnecessary adjournments. In the event of any failure on the part of the assessee to comply with the notices, the learned CIT(A) shall be at liberty to decide the appeal in accordance with law on the basis of the material available on record. 06. In the result, the appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open Court on 13/07/2026.

Sd/- Sd/- [ Dr. Arjun Lal Saini ] [ Shri Sonjoy Sarma ] लेखा सद�य/Accountant Member �याियक सद�य/Judicial Member राजकोट/Rajkot िदनांक/ Date: 13/07/2026 Copy of the order forwarded to : 1. The assessee 2. The Respondent

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ITA No. 446/RJT/2026 J N Bhatt Hut v. ITO 3. CIT 4. The CIT(A) 5. DR, ITAT, Rajkot 6. Guard File By order //True Copy// Sr. Private Secretary ITAT, Rajkot

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