SURESH CHAUDHARY,DELHI vs. ACIT, CIRCLE 49(1), DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘B’, NEW DELHI Before Sh. Challa Nagendra Prasad, Judicial Member & Smt. Renu Jauhri, Accountant Member ITA No. 1750/Del/2026 : Asstt. Year : 2021-22 ITA No. 1907/Del/2026 : Asstt. Year : 2021-22 Suresh Chaudhary, Vs ACIT, C/o M. K. Bhatt & Co., Circle-49(1), G-7, Preet Vihar, New Delhi-110002 New Delhi-110092 (APPELLANT) (RESPONDENT) PAN No. AEUPC6602G Assessee by : Sh. Malav Goswami, Adv. & Sh. M. K. Bhatt, CA Revenue by : Sh. Kumar Avikal Manu, CIT-DR Date of Hearing: 23.04.2026 Date of Pronouncement: 13.05.2026 ORDER Per Renu Jauhri, Accountant Member: These appeals filed by the assessee are directed against order dated 29.04.2025, passed by Ld. CIT(A)/NFAC, Delhi u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for A.Y. 2021-22, respectively.

ITA No. 1750/Del/2026: “1. The learned Commissioner of Income-tax (Appeals) erred in law and on facts in dismissing the appeal without adjudicating the issues on merits, merely on the ground of non-prosecution, despite the fact that the assessment itself was completed ex-parte and involved substantial additions, thereby violating the principles of natural justice and the statutory duty cast upon the first

2 ITA No. 1750 & 1907/Del/2026 Suresh Chaudhary appellate authority under section 250 to decide the appeal on merits. 2. The Ld. CIT(A) erred in law and on facts in upholding the assessment order treating purchases amounting to Rs. 10,57,19,221 as bogus solely on the basis of non-response to notices issued under section 133(6) to third parties, without rejecting the books of account, without disputing the corresponding sales, without examining stock records and quantitative details, and without appreciating that payments for such purchases were made through regular banking channels. 3. The Ld. CIT(A) erred in law and on facts in upholding the assessment order, the AO having failed to appreciate that the Appellant has maintained complete documentary evidence in respect of the impugned purchases including purchase invoices, GST returns, transport documents, stock registers and bank statements, and that mere non-response by suppliers to notices under section 133(6) cannot, by itself, justify disallowance of genuine purchases. 4. The Ld. CIT(A) erred in law and on facts in upholding disallowance Rs. 1,01,80,824 under section 40(a)(ia) on an assumed basis of non-deduction of tax at source, without examining the nature of payments, without verifying actual TDS compliance, and without appreciating that in several cases provisions of Chapter XVII-B were not applicable at all. 5. The Ld. CIT(A) erred in law and on facts In upholding the disallowance of Rs. 17,17,234 under section 43B without verifying whether the alleged statutory liabilities were paid within the lime permitted under the Act and without examining the actual dates of payment as evidenced by documentary records. 6. The Ld. CIT(A) erred in law and on facts in upholding the assessment order disallowing Rs. 21,34,319 under section 36(1)(iii) by alleging diversion of borrowed funds, without establishing any nexus between borrowed funds and alleged interest-free advances, and without appreciating that such advances were cither made for business purposes or out of interest-free own funds available with the Appellant. 7. The Ld. CIT(A) erred in law and on facts in upholding the assessment order as addition sustained are contrary to the facts on record, settled principles of law and binding judicial precedents, and are liable to be deleted in full, or in the alternative, the matter deserves

3 ITA No. 1750 & 1907/Del/2026 Suresh Chaudhary to be restored to the file of the Assessing Officer for fresh adjudication after considering the documentary evidence.”

ITA No. 1907/Del/2026: “1. That the order passed by the learned Commissioner of Income Tax (Appeals) under section 250 confirming the penalty levied under section 270A is bad in law, contrary to facts and liable to be quashed. 2. That the learned CIT(A) erred in dismissing the appeal primarily on the ground of alleged non- prosecution without adjudicating the issues on merits and without appreciating the material available on record. 3. That the learned CIT(A) erred in upholding the penalty imposed under section 270A without independently examining whether the conditions prescribed under section 270A for "under-reporting" or "misreporting" of income were satisfied. 4. That the penalty has been wrongly levied by treating the case as one of "misreporting of income" without recording any specific finding demonstrating fulfilment of the conditions specified in section 270A(9), and without establishing any element of deliberate falsification, suppression of facts or furnishing of inaccurate particulars. 5. That the learned authorities erred in levying penalty in respect of additions made on estimated, presumptive or debatable issues, which by their very nature do not attract penalty under section 270A.” 3. Brief facts are that the assessee filed his return for A.Y. 2021-22 on 11.03.2022 declaring income of Rs.34,67,590/-. The case was selected for scrutiny for verification of purchases from non-filers. Assessment was completed u/s 144 at an income of Rs.12,32,19,188/- after making various additions. Aggrieved the assessee preferred an appeal before ld. CIT(A). No compliance was made by the assessee to multiple notices

4 ITA No. 1750 & 1907/Del/2026 Suresh Chaudhary issued by ld. CIT(A). Accordingly, appeal was dismissed vide order dated 29.04.2025. Further aggrieved, the assessee is in appeal before the Tribunal.

3.2 At the outset, ld. AR has requested for remand back of the case after condonation of delay of 260 days. He has explained that the assessee was dependent on his Chartered Accountant who did not pursue the matter before lower authorities resulting in ex-parte assessment and appeal order. Further, he did not inform the assessee about the status of the case and only an attachment of his bank account, the assessee became aware and initiated steps of file appeal before the Tribunal, resulting in delay of 260 days.

5 ITA No. 1750 & 1907/Del/2026 Suresh Chaudhary 5. ITA No. 1907/Del/2026 pertains to penalty u/s 270A of the Act levied for A.Y. 2021-22 of the Act, since the assessment order has been restored to ld. AO for fresh adjudication, the penalty u/s 270A is also restored to the ld. AO for fresh consideration.