NIRMALA ELANGOVAN,CHENNAI vs. ASSESSING OFFICER NON CORP WARD 10(1) CHE, CHENNAI

The Assessee raised the following grounds of appeal : “1. The L.d. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, had passed an order dated 30.01.2026 under section 250 of the Income- tax Act, 1961 for the Assessment Year 2015-16 is contrary to facts & principles of natural justice.

The Ld. CIT(A) erred in disposing of the appeal ex-parte without adjudicating the issues on merits, merely on the ground of alleged non- compliance, despite the fact that the appellant had raised substantial legal and factual grounds challenging the assessment order

The Ld. CIT(A) failed to appreciate that all notices during the appellate proceedings were issued only through electronic mode and no physical notices were served upon the appellant, who is a housewife with limited knowledge and access to electronic communication, thereby resulting in denial of effective opportunity of being heard.

The Ld. CIT(A) erred in not considering the appellant's explanation that the amount of Rs. 63,29,669/- does not represent independent or fresh term deposits, but is a cumulative figure arising out of repeated renewal and re- deposit of fixed deposits on maturity, which were originally made (partly) out of the sale proceeds of residential property operty sold by the appellant's husband on 05.12.2013 and partly out of explained family savings, and which were ultimately reinvested in another residential property on 20.11.2014.

The Appellant's case pertains to the Assessment Year 2015-16. The relevant details were obtained from the bank and furnished as documentary evidence to establish and substantiate the genuineness of the transactions. Any delay in submitting the same occurred due to the time taken by the bank to provide the necessary information. The said delay was neither intentional nor attributable to the Appellant, nor was it with any intent to conceal facts. The Appellant acted bona fide, remained fully cooperative, and duly complied with the requirements of the Department.

The Ld. CIT(A) failed to appreciate that the addition sustained is arbitrary, unjustified, excessive, and unsustainable in law, as the impugned amount represented disclosed, identifiable, and traceable funds arising from explained sources.

The Ld. CIT(A) erred in law and on facts in passing the impugned order without granting a effective opportunity of hearing, despite Grounds of Appeal submissions having been made, and any order passed in violation of the principles of natural justice is null and void in law.

The appellant craves leave to add, alter, amend, or withdraw any of the above grounds of appeal and to file additional grounds and submissions at or before the time of hearing of the appeal.”

Briefly stated the facts of the case are that the appellant is an Individual. No regular return of income under the provisions of section 139(1) of the Act for the Assessment Year 2015-16. However, based on the information that the appellant made cash deposits in the account maintained in banking company, the Assessing Officer formed an opinion that income got escaped assessment from tax. Accordingly, a notice u/s.148 of the Act was issued on 03.04.2022 after duly complying with the procedure laid down u/s.148A of the Act. However, the appellant neither complied with the notice issued u/s.148 of the Act nor notices issued u/s.142(1) of the Income Tax Act, 1961. In the circumstances, e- Assessment Unit of the Department(hereinafter called ‘AO’) had proceeded with framing the best judgment assessment order vide order dated 11.03.2024 passed u/s.147 r.w.s 144 r.w.s 144B of the Income Tax Act, 1961 at a total income of Rs.63,29,669/-. While doing so, the Assessing Officer brought to tax the deposits in the bank account of Rs.63,29,600/- as unexplained money of the appellant u/s.69A of the Act.

Being aggrieved, an appeal was filed before the ld.CIT(A). The ld.CIT(A) however dismissed appeal in ex-parte for non-prosecution without entering into the merits of the additions.

Being aggrieved by the order of ld.CIT(A) challenging the additions made by the Assessing Officer, the appellant is in appeal before us in the present appeal.

None appeared on behalf of the appellant despite due service of notice of hearing.

On the other hand, the ld.Sr.Departmental Representative opposed the above submissions and submits that the order passed by ld.CIT(A) is justified as the appellant had not caused appearance before the ld.CIT(A).

We heard Learned Sr.DR and perused the material available on record. We find that the ld.CIT(A) dismissed the appeal of the appellant for non- prosecution without entering into the merits of the addition. The ld.CIT(A) without dealing with the contentions of the appellant merely dismissed the appeal in limine for non-prosecution. As contemplated u/s.250(6) of the Act the ld.CIT(A) is required to frame points of determination followed by a detailed discussion thereupon before passing the order. It is the settled position of law that the ld.CIT(A), even while disposing of the appeal ex-parte, he is duty bound to dispose of the appeal on merits. Reliance in this regard can be placed on the decision of the Hon'ble Bombay High Court in the case of PCIT vs. Premkumar Arjundas Luthra 279 CTR 614. The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF) [2017] 297 CTR 614 (Bombay) as under :

Therefore, in the light of above legal position, we are of the considered opinion and deem it proper to remit the matter requires to be remanded to the file of Learned CIT(A)/NFAC for de novo disposal of the issue on merits by passing a speaking order after allowing reasonable opportunity to the appellant, in accordance with law. All the contentions raised by the appellant are left open for consideration before the ld.CIT(Appeals).

In the result, the appeal filed by the assessee stands partly allowed for statistical purposes. Order pronounced in the open court on 21st May, 2026.