MEDWAY EDUCATIONAL CONSULTANT PRIVATE LIMITED,DELHI vs. ITO WARD 17(1), DELHI

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ITA 681/DEL/2026Status: DisposedITAT Delhi30 April 2026AY 2020-214 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the appeal was decided ex-parte without providing the assessee an opportunity to be heard. Therefore, the matter was restored to the NFAC for a decision on merits after granting a final opportunity to the assessee.

What were the facts?

The assessee company filed its return of income, and the AO made additions for unexplained expenditure and cash credit due to low net profit. The assessee's appeal before the NFAC was dismissed ex-parte.

What were the issues?

Whether the NFAC erred in dismissing the appeal ex-parte without providing the assessee an opportunity to be heard. Whether the appeal should be decided on merits.

Which sections of the Income-tax Act were involved?

Section 69C,Section 68,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “A”, DELHI

Before: SH. SUDHIR KUMARS & SH. MANISH AGARWAL

Hearing: 28/04/2026Pronounced: 30/04/2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A”, DELHI

BEFORE SH. SUDHIR KUMAR JUDICIAL MEMBERS AND SH. MANISH AGARWAL, ACCOUNTANT MEMBER

ITA No.681/DEL/2026 Assessment Year: 2020-21 M/s Medway Educational Vs. AO Ward17(1) Delhi Consultant Private Limited 2nd 30/4A, Floor Double Story Ashok Nagar New Delhi PAN No. AAGCM8158E (APPELLANT) (RESPONDENT)

Appellant by Sh. Rattan Singh Yadav, CA, Respondent by Sh. Ajay Kumar Arora, Sr. DR

Date of hearing: 28/04/2026 Date of Pronouncement: 30/04/2026 ORDER PER SUDHIR KUMAR, JUDICIAL MEMBER:

This appeal by the assessee is directed against the order of the National Faceless Appeal Centre (NFAC) Delhi [hereinafter referred to as “Ld. NFAC)”] vide order dated 31-12-2024 pertaining to A.Y. 2020-21 arising out the assessment order dated 21-09-2022 u/s.143(3) r.w.s. 144 B of the Income-tax Act, 1961, (in short ‘the Act’)

2.

The brief facts of the case are that the assessee a company filed its return of income on 22-01-2021 declaring income at Rs6,83,670/- for the A.Y.2020-21. The case of the assessee was selected for scrutiny to verify the business expenses as the net profit shown in the ROI was merely 0.33%. Accordingly, notice u/s 143(2) of the Act was issued to the assessee on 29-06-2021. Subsequently, the AO issued the statutory notices on various dates. The AO completed the assessment after considering the submission furnished by the assessee by dis-allowancing and making the following additions as under: (i) Disallowance of unexplained expenditure u/s 69 C of the Act Rs2,00,74,294/- (ii) unexplained cash credit u/s 68 of the Act Rs.35,00,000/-. 3. Aggrieved the order of the ld. AO the assessee preferred the appeal before the Ld. NFAC who vide his order dated 31- 12-2024 dismissed the appeal. Being aggrieved the order of the Ld. NFAC the assessee is in appeal before the Tribunal. 4. The Ld. AR of the assessee submitted that the opportunity of being heard was not provided by the lower authorities. The Learned authorized representative for Department of Revenue submitted that departmental

authorities have passed reasoned orders. He also submitted that the assessee has not taken part in the proceedings before the Ld. NFAC.The appeal was rightly rejected by the Ld. NFAC. 5. We have heard the Ld. DR and perused the material available on record. It is an admitted fact that despite opportunities granted by Ld. NFAC, the assessee did not file his submissions, for which the appeal was dismissed ex-parte, by the Ld. NFAC. 6. Since in the instant case the assesse has failed to file his submission after availing the various opportunity. The assessee did not appear before appellate authority and the Ld. NFAC dismissed the appeal ex-parte. The appeal should have been decided on merit as per the provision of the section 250 of the Act. The appeal was decided ex-parte without giving the opportunity of being heard to the assessee. Therefore, considering the totality of the facts and circumstances of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. NFAC with a direction to grant one final opportunity to the assessee to substantiate its claim and decide the issue as per fact and law. The assessee is also directed to appear before the Ld. Assessing officer and co-operate in the

proceedings. The grounds raised by the assessee are accordingly allowed for statistical purposes. 7. In the result, the appeal of the assessee is allowed for

statistical purposes.

Order pronounced in the open court 30.04.2026.

Sd/- Sd/-

(MANISH AGARWAL) (SUDHIR KUMAR) ACCOUNTANT MEMBER (JUDICIAL MEMBER) SR BHATTANGAR Date: 30.04.2026 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) ` 5. DR: ITAT ASSISTANT REGISTRAR ITAT DELHI

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