DIPAKBHAI LALLUBHAI PATEL,NA vs. ARIVS.INCOME TAX OFFICER,WARD 2 , NAVSARI

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ITA 1375/SRT/2025Status: DisposedITAT Surat29 May 2026AY 2017-184 pages
AI SummaryRemanded

What did the Tribunal hold?

The tribunal condoned the delay in filing the appeal, noting that the CIT(A) dismissed the appeal without discussing merits. A cost was imposed on the assessee, and the matter was remanded to the AO for fresh adjudication.

What were the facts?

The assessee deposited substantial cash during demonetization, leading to an addition by the AO for unexplained opening cash balance. The CIT(A) dismissed the assessee's appeal ex-parte due to non-prosecution.

What were the issues?

Whether the CIT(A) erred in passing an ex-parte order without providing a sufficient opportunity to be heard. Whether the addition made by the AO on account of unexplained opening cash balance was justified.

Which sections of the Income-tax Act were involved?

Section 68,Section 115BBE,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SURAT ‘SMC’ BENCH, SURAT

Before: Ms. Suchitra Kamble

IN THE INCOME TAX APPELLATE TRIBUNAL SURAT ‘SMC’ BENCH, SURAT (HYBRID HEARING) Before: Ms. Suchitra Kamble, Judicial Member ITA No: 1375/SRT/2025 Assessment Year: 2017-18

Dipakbhai Lallubhai Patel, ITO, At & Post – Manekpur, Via Vs Ward – 2, Gadat, Manekpur, Navsari – Navsari 396360, Gujarat PAN: AYFPP0548K (Appellant) (Respondent)

Appellant Represented : Shri Rasesh Shah, CA : Shri Ajay Uke, Sr. DR Respondent Represented

Date of hearing : 26-03-2026 Date of pronouncement : 29-05-2026 आदेश/ORDER The appeal filed by the assessee is against the order passed by the Learned Commissioner of Income Tax (Appeals), [in short “CIT(A)”], National Faceless Appeal Centre (NFAC), Delhi, dated 26.12.2023 for the Assessment Year (AY) 2017-18.

2.

The assessee has raised the following grounds of appeal: “1. On the facts and circumstances of the case as well as law on the subject, Ld. CIT(A) has erred in passing ex-parte order without giving reasonable and sufficient opportunity of being heard

I.T.A No.1375/SRT/2025/AY 2017-18 2 Dipakbhai Lallubhai Patel vs. ITO

2.

On the facts and circumstances of the case as well as law on the subject, the Ld. CIT(A) has erred in dismissing the appeal without passing speaking order. 3. On the facts and circumstances of the case as well as law on the subject, the learned assessing officer has erred in making addition of Rs. 14,10,923/- u/s. 68 on account of alleged unexplained opening cash balance. 4. On the facts and circumstances of the case as well as law on the subject, the learned assessing officer has erred in taxing the addition by taking the rate @77.25% by attracting S. 115BBE instead of normal tax rate. 5. On the facts and circumstances of the case as well as law on the subject, the assessing officer has erred in taxing the income u/s 115BBE @ 77.25% in a retrospective manner by applying the duly substituted S.115BBE inserted retrospectively instead of taxing it at 35.54% as per the old provisions of S. 115BBE. 6. It is prayed that the addition made by the assessing officer may please be deleted or the matt may please be set aside to the file of CIT(A) or assessing officer for fresh adjudication. 7. Appellant craves leave to add, alter or delete any ground(s) before or in the course of hearing of the appeal.” 3. The assessee had deposited substantial cash in the various bank accounts during the demonetization period. Various statutory and show notices were issued, but there was complete non-compliance on the part of the assessee. The Assessing Officer observed that the assessee had filed his ITR for AY 2017-18 on 17.03.2015, but the same has been treated as invalid/non-est due to pendency of e-verification. The Assessing Officer (in short, ‘AO’) observed that cash deposited during the demonetization period, the assessee has enhanced opening cash balance of Rs.14,10,923/- (15,28,428 – 1,17,505). Therefore, the Assessing Officer held that this difference in cash balance is liable to

I.T.A No.1375/SRT/2025/AY 2017-18 3 Dipakbhai Lallubhai Patel vs. ITO

be treated as unaccounted income. The AO completed the assessment under section 144 of the Act by making addition of Rs.14,10,923/- under section 68 of the Act on account of difference in opening and closing cash balance.

4.

Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee due to non-prosecution.

5.

The Ld. AR submitted that both AO and CIT(A) passed an ex- parte order without opportunity of being heard to the assessee. The assessee could not appear before the lower authorities and failed to submit the necessary details due to unavoidable circumstances. The Ld. AR submitted that in the interests of justice, one more opportunity should be given to the assessee to plead its case before the AO.

6.

The Ld. DR relied upon the assessment order and the order of the CIT(A).

7.

We have heard both the parties and perused all the relevant materials available on record. There is delay in filing present appeal for which the assessee filed the condonation of delay application along with affidavit. The reason for delay appears to be genuine, hence delay is condoned. It is pertinent to note that the assessee did not respond any notices before the Assessing Officer as well as the CIT(A), but the CIT(A) has dismissed the appeal without discussing the merits. Hence, we deem it proper to impose a cost of Rs.5,000/- (Rupees Five Thousand only) on the assessee, which should be deposited in “Prime

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Minister’s National Relief Fund” within a period of 15 days from the receipt of this order. The matter is remanded back to the file of the Assessing Officer for proper verification and adjudication of the documents filed by the Assessee. The assessee is also directed to comply before the AO by not seeking adjournment without valid reason. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice.

8.

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

Order pronounced in the open court on 29-05-2026

Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Surat Dated: 29/05/2026 SAMANTA** आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Surat 6. Guard file.

By order, // TRUE COPY // Assistant Registrar/Sr.PS/PS

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