DIVYESH MAHESHKUMAR PRAJAPATI,AHMEDABAD vs. THE ITO, WARD-3(3)(1), AHMEDABAD

PER ANNAPURNA GUPTA, AM:

The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi (hereinafter referred to as “CIT(A)”) dated 04.12.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2021-22.

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 2 – 2. The grounds of appeal raised by the assessee read as under:

“1. That, on this fact and in the circumstances of the case and in law, the Lrd. Commissioner of Income Tax (E-Appeals) (for short "Appellate Authority") has erred in dismissing the appeal of the appellant on the grounds of the limitation by not condoning of delay u/s, 143(3) r.w.s. 144B of the Income Tax Act. 2. The Lrd. Appellate Authority failed to appreciate that the appellant had a reasonable and sufficient caused for not filing the appeal within prescribed time period. The appellant had remained present and co-operated during assessment proceedings. Due to default on the part of the then consultant, appellant could not file appeal in time. Therefore, the Lrd. CIT (A) ought to have accepted the delay condonation application and delay of 670 days caused in filing the appeal. 3. The Lrd. Appellate Authority has grievously erred in law dismissing the appeal filed against the order u/s. 143(3) r.w.s. 144B of the Income Tax Act wherein the delay was properly explained. Hence, the order passed by the appellate authority deserves to be quashed and set aside and delay file in First Appeal and delay of 1 months cause in ling a second appeal is to be condone. 4. The Lrd. Commissioner of Income Tax (E-Appeals) (for short "Appellate Authority") has erred in law in passing the appeal order whereby he has confirmed order passed by the Income Tax Officer, NFAC (Assessment)-Delhi and dismissed the appeal on the grounds of limitation/time-barred and not condone the delay on the grounds of appellant had not sufficient cause for not presenting the appeal within the due date stipulated u/s. 249 (3) of the Income Tax Act. The appellate authority has dismissed the appeal without giving proper opportunity of being heard to the appellant. Hence the same being against the principle of natural justice and law required to be quashed. The Lrd. Appellant Authority could have condone the delay as appellant was prevented by sufficient and reasonable cause and by not granting the condo nation in delay of filing the appeal, the appellant is deprived of proper justice. Hence, order passed by the appellant authority deserves to be quashed and set a side and delay cause filing the first appeal may please be condone. 5. The Lrd. Appellant Authority has erred in law in dismissing the appeal of the appellant and confirmed the order of the assessing authority with regard to make various additions of Rs. 3,03,15,806/-. The action of the appellate authority and the Lrd. AO for passing the assessment order is not according to law to extent of making various additions. That on the facts and in

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 3 – circumstances of the case in law, the Lrd. Assessing Authority has erred in law in making the various additions are as under: a. Disallowance Rs. 2,86,80,853/u/s. 37(1) of doubtful purchases @25% of total purchases of Rs. 11,47,23,411/- considering as purchases made from non-filer of return of income, additions was made u/s. 37(1) of the Income Tax Act. b. Disallowance Rs. 11,47,234/- u/s. 69C Unexplained Expenses paid to the broker for doubtful purchases of Rs. 11,47,23,411/- the Lrd. AO had charge tax by applying section 115BBE of the Income Tax Act. c. Disallowance Rs. 4,87,719/- u/s. 68 as Unexplained Cash Credit i.e. (Unsecured Loan) without considering the genuineness of the transactions of the Unsecured Loan. The Lrd. AO applied provision of section 115BBE of the Income Tax Act. 6. The opportunity to submit details in the case was not properly given and without giving a chance of personal hearing and to submit more details in support of the case, the order passed is in gross violation of principal of natural justice. 7. The Lrd. AO ought to have condone the delay by verifying the genuine and sufficient cause faced by the appellant for not filing the appeal within the prescribed time period. The dismissing of the appeal by not considering various factual and legal grounds raised by the appellant. Hence, the order passed is highly unjustifiable and unlawful. 8. The Lrd. Commissioner of Income Tax (E-Appeals) has erred in law in passing the appeal order confirming the action of Income Tax Officer, NFAC(Assessment)-Delhi, whereby confirmed the disallowance of Rs. 2,86,80,853/- w/s. 37(1) of the Income Tax Act of doubtful purchases @25% of the total purchases of Rs. 11,47,23,411/-made during the year under consideration. The appellant has done the all the sales and purchases transactions through banking channel only. 9. The Lrd. Assessing Authority has erred in law in disallowance of Rs. 11,47,234/- u/s. 69C of the Income Tax Act i.c. @1% Commission paid to the broker for doubtful purchases of Rs. 11,47,23,411/-. The Lrd. AO treated as a Unexplained Expenses without any application of mind and without jurisdiction and bad in law The Lrd. Assessing Authority (NFAC) has on facts and on law grievously erred in making addition of Rs. 2,86,80,853/- u/s. 37(1) of the Income Tax Act by applying provision of section 115BBE of the Income Tax Act.

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 4 – 10. The Lrd. Assessing Authority has erred in law in disallowance of Rs. 4,87,719/- u/s. 68 of the Income Tax Act i.e. Unsecured Loan without considering the genuineness of the transactions of the Unsecured Loan the Lrd. AO treated as a Unexplained Cash Credit without any application of mind and without jurisdiction and bad in law and applying provision of section 115BBE of the Income Tax Act. 11. The Lrd. Assessing Authority (NFAC) has on facts and on law grievously erred in making various additions Rs. 3,03,15,806/- in the various sections of the Income Tax Act which is highly unjustifiable and unlawful. 12. The Lrd. Assessing Authority has grievously erred in law in not considering reply and documents submitted by the appellant in right perspective and passed the assessment order by making huge addition of Rs. 3,03,15,806/-made during the year consideration. 13. The Lrd. Assessing Authority has erred in charging interest on consequential demand raised in assessment order. 14. The Lrd. Assessing Authority has grievously erred in law in initiating penalty proceedings u/s. 271AAC(1) and 270A of the Income Tax Act in absence of any violation of the said provision. 15. The appellant craves leave to add, alter, modify, withdraw or amend any of the grounds of appeal either before or at the time of hearing of the appeal.”

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 5 – “Delay in filing appeal:- As per record, the appeal has not been filed within time stipulated u/s 249(2) of the Act. The order under appeal is dated 26/12/2022 and the appeal has been filed on 25/11/2024. The appellant in Form No. 35 & condonation attachment has submitted that: "1. The appellant Mr. Divyesh Maheshkumar Prajapati is into the business of trading of Wood, fabric or Waste and Scrap. The taxpayer is running the business under the name and style M/s Divy Enterprise. 2. The Lrd. Income Tax Officer, Assessment Unit, Income Tax Department, National Faceless E-Assessment Centre, New Delhi, has passed the assessment order u/s. 143(3) r.w.s. 1448 of the Income Tax Act, On page 2of the assessment order, the Lrd. AO has mentioned details about opportunities given to the appellant. It is true that in majority of the occasion the appellant could not responded to the notices and letters issued as per table in para no. 2. Since the appellant is not very acquainted with the procedure so whenever the notices were issued and such messages are conveyed on his mobile, the appellant has forwarded the said messages to his consultant and he was assured by the consultant that necessary action will be taken from their side. However, when the assessment order comes to the notice of the appellant he came to know about non-appearance of the consultant and not responding to the various points raised by the assessing authority in various notices, In fact the consultant has also not informed to the appellant about passing of such ex-parte best judgment assessment order. Recently, when recovery proceedings were initiated by the jurisdictional officer, appellant came to know about such passing of ex-parte assessment order. Therefore, there is a delay of almost 1years and 10 months in filing of first appeal. As the appellant was not aware about passing of such assessment order nor he is having any idea about online procedure of Income Tax nor he is acquainted with the technology and was not guided or informed by his the then consultant there is a delay of 1 years and 11 months caused in filing the appeal. Delay caused in filing the appeal may kindly be condoned in the interest of justice.

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 6 – taking necessary action and responding to the same, but his Consultant did not furnish all information asked for by the AO. That the Consultant even did not intimate the assessee of passing of the assessment order and that it was only when recovery proceedings were initiated on the assessee that he became aware of the passing of the assessment order and, accordingly, filed the appeal with a delay of 1 year 11 months before the Ld. CIT(A).

ITA No.2434/Ahd/2025 [Divyesh Maheshkumar Prajapati vs. ITO] A.Y. 2021-22 - 7 – Crores, being made to the returned income of the assessee of Rs.3,62,050/-. In the interest of justice, therefore, we are of the view that the delay of 670 days before the Ld. CIT(A) be condoned. Ld. CIT(A) is directed to adjudicate the appeal afresh after giving due opportunity of hearing to the assessee. However, at the same time noting the non-participation of the assessee before the AO also, we consider it fit to impose a cost of Rs.20,000/- on the assessee to be deposited to the Prime Minister's National Relief Fund within 30 days of the receipt of this order. Ld. CIT(A) is directed to proceed with the matter only after confirming the payment of cost imposed by us within the time specified as above.

This Order pronounced on 15/05/2026

Sd/- Sd/- (SANJAY GARG) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 15/05/2026 S. K. SINHA True Copy आदेश क� �ितिल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��यथ� / The Respondent. 2. 3. संबंिधत आयकर आयु� / Concerned CIT आयकर आयु�(अपील) / The CIT(A)- 4. �वभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad