BHUPATBHAI BACHUBHAI PALDIA,SURAT vs. ITO, WARD 3(3)(1), SURAT

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ITA 439/SRT/2025Status: DisposedITAT Surat09 June 2026AY 2017-186 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT found that the CIT(A) erred in dismissing the appeal on a technicality without adjudicating the merits. The tribunal directed the CIT(A) to decide the appeal on merits after calling for a remand report from the AO.

What were the facts?

The assessee did not file a return of income. The AO reopened the case based on information of property acquisition and added the entire purchase consideration as unexplained income. The CIT(A) dismissed the assessee's appeal on technical grounds.

What were the issues?

Whether the CIT(A) was justified in dismissing the appeal on a technical ground without considering the merits, and whether the reopening and additions were valid.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 144,Section 69,Section 115BBE,Section 272A(1)(d),Section 271AAC,Section 271F,Section 234A,Section 234B,Section 249(4)(b)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB” BENCH, SURAT

Before: SHRI TR SENTHIL KUMAR & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri P M Jagasheth, CA
For Respondent: Shri Mukesh Jain, CIT-DR
Hearing: 29.04.2026Pronounced: 09.06.2026

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

This appeal is filed by the assessee against the order of National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 09.02.2024 for the Assessment Year (A.Y.) 2017-18 in the proceeding u/s 147 r.w.s. 144 of the Income Tax Act [hereinafter referred as “the Act”].

2.

There was a delay of 77 days in filing of this appeal. The assessee had filed a condonation application explaining the reason for delay. It has been explained that the last two notices of the Ld. CIT(A) were received on different e-mail Id and his order was also received on different e-mail

ITA No. 439/Srt/2025 Bhupatbhai Bachubhai Paldia Vs. ITO, Asst.Year 2017-18 2 Id, which could not be accessed in time and, therefore, there was a delay of 77 days in filing of this appeal. Considering the explanation of the assessee, the delay in filing of the appeal is condoned.

3.

The brief facts of the case are that the assessee did not file his return of income for A.Y. 2017-18. The AO had received an information that the assessee had made total payment of Rs.5,21,27,800/- towards acquisition of immovable properties during the year. On the basis of this information, the case of the assessee was reopened after recording the reason and a notice u/s. 148 was issued on 30.03.2021. Before the AO, no compliance was made by the assessee. Therefore, the entire purchase consideration of Rs. 5,21,27,800/- was held as unexplained and added to income. The assessment was completed u/s. 147 r.w.s. 144 of the Act on 29.03.2022 at total income of Rs. 5,21,27,800/-.

4.

Aggrieved with the order of the AO, the assessee had filed an appeal before the first appellate authority, which was decided by the Learned CIT(A) vide the impugned order and the appeal of the assessee was dismissed. Th

5.

Now the assessee is in second appeal before us. The following grounds have been taken in this appeal:

1.

On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in reopening the assessment u/s 147 of the Act and notice u/s. 148 of the Act was issued. 2. On the facts and in the circumstances of the case as well as the law on the subject, the learned Assessing Officer has erred in passing ex-parte assessment order U/s.144 r.w.s. 144B of the Income Tax Act, 1961.

ITA No. 439/Srt/2025 Bhupatbhai Bachubhai Paldia Vs. ITO, Asst.Year 2017-18 3

3.

On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in making addition of Rs.5,21,27,800/- on account of transfer of immovable property/purchase of immovable property treated as alleged unexplained investment of u/s.69 r.w. s. 115BBE of the Act. 4. On the facts and in the circumstances of the case as well as the law on the subject, the learned Assessing Officer has erred in initiating penalty proceeding u/s.272A(1)(d) of the Income Tax Act, 1961. 5. On the facts and in the circumstances of the case as well as the law on the subject, the learned Assessing Officer has erred in initiating penalty proceeding u/s.271AAC of the Income Tax Act, 1961.

6.

On the facts and in the circumstances of the case as well as the law on the subject, the learned Assessing Officer has erred in initiating penalty proceeding u/s 271F of the Income Tax Act, 1961 7. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in levying interest u/s.234A and 234B of the Income Tax Act, 1961.

8.

On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has not offered adequate opportunities to hear the case and passed ex-parte order and hence, the case may please be set aside and restored back to the CIT(A) or AO. 9. It is therefore prayed that the above addition may please be deleted as learned members of the tribunal may deem it proper. 10. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.

6.

Shri P M Jagasheth, the Ld. AR of the assessee explained that the Ld. CIT(A) did not adjudicate the grounds taken by the assessee on merits but had dismissed the appeal on technical ground that the assessee did not pay the advance tax in accordance with the provision of section 249(4)(b) of the Act. He explained that in response to the deficiency notice

ITA No. 439/Srt/2025 Bhupatbhai Bachubhai Paldia Vs. ITO, Asst.Year 2017-18 4 issued by the Ld. CIT(A), the assessee had furnished his reply clarifying that the income of the assessee during the year did not exceed the taxable limit and he was not required to file any return of income for the year under consideration. It was further clarified in form No. 35 that the assessee had only 7% share in the property purchased which worked out to Rs.31,09,400/-. Still the Ld. CIT(A) did not consider the submissions of the assessee on merits and dismissed the appeal of the assessee as non- maintainable. He therefore, requested that the matter may be set aside to the file of Ld. CIT(A) with a direction to adjudicate the grounds taken by the assessee on merits.

7.

Per contra, Shri Mukesh Jain the Ld. CIT-DR, had no objection if the matter was set aside to the file of Ld. CIT(A) for deciding the appeal of the assessee on merits.

8.

We have considered the submissions of the assessee. It is found that the AO had allowed as many as four opportunities but no compliance was made on any of the occasion. The fact that the assessee had only 7% share in the property acquired during the year, was never brought to the knowledge of the Assessing Officer. The assessee has not given any explanation for non-compliance before the AO in spite of repeated opportunities provided to him. We, therefore, deem it proper to impose a cost of Rs. 10,000/-, on the assessee which should be deposited to Prime Minister National Relief Fund within a period of two weeks from the date of receipt of this order. Subject to payment of cost, the matter is set aside to the file of Ld. CIT(A) with a direction to adjudicate the grounds taken by the assessee on its merits. When the assessee had submitted in Form No. 35 that his share in the property acquired during the year was only 7%, whereas the addition was made for 100% of the cost of

ITA No. 439/Srt/2025 Bhupatbhai Bachubhai Paldia Vs. ITO, Asst.Year 2017-18 5 acquisition in the hands of the assessee, the Ld. CIT(A) was not correct in rejecting the appeal of the assessee on technical ground that no advance tax was paid as per provision of section 249(4)(b) of the Act. The liability of advance tax should have been looked into, taking into consideration the submission of the assessee regarding his interest in the property acquired. The Ld. CIT(A) is, therefore, directed to adjudicate the grounds taken by the assessee before him, on merits. He is also directed to call for a remand report of the AO on the additional evidences filed before him and thereafter adjudicate the matter. The assessee is also directed to make compliance before the Ld. CIT(A) in the course of set aside appellate proceeding. In case, the assessee does not make compliance, the Ld. CIT(A) will have liberty to adjudicate the matter on the basis of materials available on record.

9.

In the result, the appeal of the assessee is allowed for statistical purpose.

Order pronounced in the Court on 09/06/2026 at Ahmedabad.

Sd/- Sd/- (TR SENTHIL KUMAR) (NARENDRA PRASAD SINHA) Judicial Member Accountant Member Dated – 09th June, 2026 Neelesh, Sr. PS (True Copy) आदेश आदेश क� आदेश आदेश क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : अ�ेिषत 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A) 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण / DR, ITAT, 6. गाड� फाईल /Guard file.

ITA No. 439/Srt/2025 Bhupatbhai Bachubhai Paldia Vs. ITO, Asst.Year 2017-18 6

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

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