MAHESH CHANDRAKANT GAIKWAD,AHMEDNAGAR vs. INCOME TAX OFFICER WARD 1, AHMEDNAGAR

Although a number of grounds have been raised by the assessee in both of these appeals, however, in ITA No. 1869/PUN/2025 these all relate to the order of the Ld.CIT(A)/NFAC in confirming the addition of Rs. 1,06,01,000/- u/s. 68 of the Act in respect of capital contribution by the assessee. In ITA No. 2001/PUN/2025 all the grounds relate to the order of the Ld.CIT(A)/NFAC in confirming the addition of Rs. 9,35,000/- on account of receipts offered during the survey and addition of

The facts in ITA No. 1869/PUN/2025 for the AY. 2013-14 as culled out from the statement of facts in Form-35 are that the assessee is an individual and filed his return of income for the AY. 2013-14 declaring income of Rs. 3,33,600/- on gross receipts of Rs. 41,69,520/-. There was a survey action u/s. 133A of the Act on 16-08-2017. During the course of survey, balance sheet relating to AY. 2013-14 was found. The AO observed that the assessee had shown Rs. 1,06,83,604/- as capital. On the basis of this capital, the case of the assessee was reopened u/s. 147 of the Act by issue of notice u/s. 148 of the Act on 28-03-2018.

During the course of assessment proceedings, the assessee explained the sources of capital introduction as gifts. The assessee also furnished affidavits of the persons along with income tax returns and balance sheet, explaining the sources of gifts. The Ld. Assessing Officer (“AO”), however, rejected the explanation on the ground that the creditworthiness and genuineness of the amounts was not proved by the assessee. The Ld.AO, therefore, proceeded to complete the assessment by determining the total income of the assessee at Rs. 1,09,34,600/-, thereby making the following additions of Rs. 1,06,01,000/- u/s. 68 of the Act in respect of capital contribution by the assessee, vide his order dt. 26-12-2018 passed u/s. 144 r.w.s.147 of the Act: Rs. Shri Chandrakant Mohan Gaikwad Father 81,00,000 Mrs. Lilabai Chandrakant Gaikwad Mother 11,00,000 Smt. Tarabai Mohan Gaikwad Grand 14,01,000 Mother Total: 1,06,01,000

The assessee filed appeals for both the AYs before the Ld.CIT(A)/NFAC, challenging the aforesaid additions. Despite service of notices of hearing issued during the appellate proceedings, there was non- compliance which resulted in ex-parte decision by the Ld.CIT(A)/NFAC, dismissing the appeals of the assessee for non-prosecution and endorsing findings of the Ld.AO for both the AYs involved.

Aggrieved, the assessee is in appeal before the Tribunal for both the assessment years i.e., AY. 2013-14 and AY. 2017-18.

We have heard the Ld. Representatives of the parties and perused the material available on record. The Ld.AR submitted that due to certain unavoidable circumstances, the assessee could not access the e-mail during the relevant period when the notices were sent by the Ld.CIT(A)/NFAC. It is submitted by the Ld.AR that the assessee has a strong case on merits and, therefore, prayed that in the interest of justice, the assessee may be granted an opportunity to substantiate his case

The Ld.DR relied on the order of the Ld.CIT(A)/NFAC and submitted that since the assessee failed to make any submissions in spite of several opportunities granted, the Ld.CIT(A)/NFAC was completely justified in dismissing the appeal of the assessee. We observe that the Ld.CIT(A)/NFAC has dismissed the assessee’s appeal on account of non- compliance of various notices issued to the assessee and upholding the findings of the Ld.AO without himself dwelling into the merits of the case due to lack of any documentary evidence/submissions made by the assessee before him in support of his claim.

On the facts and in the circumstances of the case enumerated above, we are of the opinion that, in the interest of justice, both the appeals deserve to be sent back to the file of the Ld.CIT(A)/NFAC for fresh adjudicating, on merits as per fact and law, after allowing reasonable opportunity of hearing to the parties. Needless to say, the assessee shall provide the requisite support in terms of submitting the relevant documents/evidence as may be required/called upon on the appointed date, without seeking any adjournment, unless required for a sufficient cause failing which the Ld.CIT(A)/NFAC shall be at liberty to pass the appropriate order in accordance with law. At the same time, because of callous attitude of the assessee in not responding to the notices issued by the office of Ld.CIT(A)/NFAC, we levy a cost of Rs. 10,000/- (Rs.5,000/- for each appeal) on the assessee, which shall be deposited within one month from the date of receipt of this order. The Ld.CIT(A)/NFAC shall ensure that the cost has been deposited before disposal of both the appeals. We

In the result, both the appeals filed by the assessee are treated as allowed for statistical purposes.