SURESH KUMAR,SONBHADRA vs. INCOME TAX OFFICER - III(4), SONBHADRA

IN THE INCOME TAX APPELLATE TRIBUNAL CIRCUIT BENCH (SMC), VARANASI BEFORE SHRI. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA No.20 & 21/VNS/2025 Assessment Year: 2014-15 Suresh Kumar v. The ITO-III(4) C-303, Fire Station Sonbhadra Pipri, Turra, S.O. Pipari Sonbhadra (U.P) TAN/PAN:ANJPK9009M (Applicant) (Respondent) Applicant by: Application for adjournment Respondent by: Shri Deepak Yadav, D.R. O R D E R These appeals have been preferred by the Assessee against the orders dated 07.02.2024 and 22.08.2024, passed by the National Faceless Appeal Centre, Delhi (NFAC) in quantum proceedings as well as penalty proceedings for Assessment Year 2014-15.

2.0 The brief facts of the case are that the assessee earned income from salary as well as from trading of shares. The assessee e-filed his return of income for the year under consideration on 25.07.2014 declaring a total income of Rs.3,63,930/- after claiming deduction of Rs.97,160/- under Chapter VIA of the Income Tax Act, 1961 (hereinafter called 'the Act’). The case of the assessee was selected for scrutiny to examine the reason for large value of transaction reported in

ITA No.20 & 21/VNS/2025 Page 2 of 7

Security Transaction Tax Return and no capital gain offered for tax in the return filed by the assessee. The Assessing Officer (AO) issued statutory notices to the assessee, requiring the assessee to furnish the copy of Return, copy of Bank Statement and Form 16 and also details of Share Trading Account along with the account statement. However, there was no response from the side of the assessee. Thereafter, the AO issued notice under section 133(6) of the Act to National Stock Exchange of India Limited, Mumbai (NSCCL), requiring them to furnish the details of transactions entered into by the assessee in NSCCL. However, there was no response from NSCCL either. Since there was no response from the side of the assessee to the notices issued by the AO, the AO proceeded to complete the assessment on the basis of Best Judgment Assessment, after issuing show cause notice to the assessee. While completing the assessment under section 144 of the Act, the AO noted that as per information from Security Transaction Tax Return, the assessee had made transaction value of Rs.5,35,34,161/- but he had not disclosed any Capital Gain on such transaction, and, therefore, he treated 1% of Rs.5,35,34,161/- (which came to Rs.5,34,341/-) as Short Term Capital Gain and added the same to the total income of the assessee.

ITA No.20 & 21/VNS/2025 Page 3 of 7

2.1 The AO further noticed that the assessee had deposited an amount of Rs.4,00,000/- in his Bank Account on 29.07.2013. However, the assessee had not furnished any explanation pertaining to source of such deposits and, therefore, the same was treated as deposits from undisclosed sources and was added to the total income of the assessee.

2.2 The AO completed the assessment under section 143(3) read with section 144 of the Act, assessing the total income of the assessee at Rs.12,98,270/-.

2.3 The AO also initiated penalty proceedings under section 271(1)(c) of the Act for concealment of income amounting to Rs.9,34,341/-. Since the assessee had failed to comply with the notice issued under section 271(1)(c) of the Act, the AO held that the assessee has concealed the particulars of his income to the tune of Rs.9,34,341/- and, therefore, he imposed a penalty of Rs.2,11,240/- being the minimum penalty imposable @ 100%.

2.1 Aggrieved, the Assessee preferred appeals before the Ld. First Appellate Authority. Subsequently, the appeals were migrated to NFAC, which dismissed the appeal in the quantum proceedings as well as penalty proceedings, by passing orders ex- parte qua the assessee.

ITA No.20 & 21/VNS/2025 Page 4 of 7

2.4 Now the assessee has approached this Tribunal challenging the orders of the NFAC, by raising the following grounds of appeal:

GROUNDS IN ITA NO.20/VNS/2025:

ITA No.20 & 21/VNS/2025 Page 5 of 7

3.0 None was present for the assessee when the appeal was called out for hearing. However, applications dated Nil of the assessee, seeking adjournment, were placed before me citing the reason that the authorized representative of the assessee will be out of station on the date fixed for hearing and, therefore, will be unable to present the case of the assessee before the Tribunal. It was prayed that the appeals may be fixed for hearing atleast 15 days after the present date. However, looking into facts of the case, I reject the adjournment applications and proceed to adjudicate the appeals.

ITA No.20 & 21/VNS/2025 Page 6 of 7

4.0 The Ld. Sr. D.R. placed reliance on the orders of the NFAC and submitted that the assessee had not appeared before the lower authorities and now before the Tribunal too, the assessee had failed to appear. The Ld. Sr. D.R. prayed that the orders of the NFAC in the quantum as well as in the penalty may be upheld and the appeals of the assessee be dismissed.

5.0 I have heard the Ld. Sr. D.R. and have perused the material on record. It is evident that the orders passed by both the authorities are ex-parte qua the assessee. Looking into the facts of this case, I am of the considered view that the assessee deserves one more opportunity to present his case and, therefore, I set aside the order of the NFAC in quantum proceedings and restore this file to the Office of the AO with the direction to provide one more opportunity to the assessee to present his case. I also caution the assessee to fully comply with the directions of the AO in the set-aside proceedings when called upon to do so, failing which, the AO would be at complete liberty to pass the order in accordance with law, based on material available on record even if it is ex-parte qua the assessee.

5.1 Since the quantum appeal has been restored to the AO, the penalty appeal is also being restored to the file of the AO for re-adjudication after giving proper opportunity to the assessee.

ITA No.20 & 21/VNS/2025 Page 7 of 7

6.0 In the result, both the appeals of the assessee stand allowed for statistical purposes.

Order pronounced in the open Court on 21/08/2026.

Sd/- [SUDHANSHU SRIVASTAVA] JUDICIAL MEMBER DATED:21/08/2026 JJ: Copy forwarded to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR By order

Assistant Registrar/DDO