VARUN GUPTA,DELHI vs. INCOME TAX OFFICER, WARD 59(3), NEW DELHI, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHIBENCH ‘A’, NEW DELHI Before Sh. Raj Kumar Chauhan, Judicial Member & Sh. Manish Agarwal, Accountant Member ITA No. 822/Del/2026 :Asstt. Year: 2022-23 Varun Gupta, Vs Income Tax Officer, 30, Sukh Vihar, Near Gagan Vihar, Ward-59(3), New Delhi-110092 New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AIWPG8561E Assessee by: Sh. Lakshay Gupta, CA Revenue by: Sh. Jitender Singh, CIT-DR Date of Hearing: 18.05.2026 Date of Pronouncement: 20.05.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeal is directed against the order dated 03.11.2025 of Learned Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (hereinafter referred to as the “CIT(A)/NFAC”), passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein the addition made u/s 69 of the Act, vide assessment order dated 26.03.2025 was confirmed.

2 ITA No. 822/Del/2026 Varun Gupta

3 ITA No. 822/Del/2026 Varun Gupta

search proceedings in the case of Omaxe Group, and the investigation report to conclude that the assessee had made cash payments amounting to Rs. 1,00,00,000/- for purchase of immovable properties in the projects of Omaxe Ltd. at Chandigarh and Palwal. Accordingly, the Assessing Officer treated the amount of Rs. 1,00,00,000/- as unexplained investment u/s 69 of the Income Tax Act and added the same to the income of the assessee.

4 ITA No. 822/Del/2026 Varun Gupta

and void being said notice has been issued in gross contravention of e Assessment of Income Escaping Assessment Scheme, 2022 notified by Honble CBDT u/s 151A of the Act on 29.03.2022 vide CBDT Notification No. 18/2022 as the authority prescribed and empowered to issue such statutory notice u/s 148 of the act lies with Faceless Assessing Officer and not with the Jurisdictional Assessing Officer. As such, impugned assessment proceeding deserves to be quashed at the threshold. 3. That the Ld. CIT(A) had erred both in law and on facts by upholding the initiation of impugned assessment proceeding initiated u/s 147 of the act without appreciating the fact that impugned statutory notice dated 27.03.2024 issued u/s 148 of the act is invalid being said notice is purely ambiguous and fails to indicate under what specific instance, Clause (iv) of Explanation 2 of Section 148 of the act is invokable but to the contrary, each and every limb has been extracted in notice itself in generalized format without identifying the extracts actually claimed to be applicable to the case of the appellant. As such, impugned ambiguous statutory notice issued u/s 148 of the act is invalid and non est. 4. That the Ld. CIT(A) had erred both in law and on facts by upholding the initiation of impugned assessment proceeding initiated u/s 147 of the act without appreciating the fact that impugned notice dated 27.03.2024 issued u/s 148 of the act is invalid being Ld. Income Tax Officer, Ward 59(3), New Delhi (hereinafter refer as Ld. AO) had invalidly invoked Clause (iv) of Explanation 2 of Section 148 of the act without being in possession of proper approval u/s 151 of the act as the copy of approval confronted to the appellant alongwith said notice is an unsigned document, rendering any subsequent action based upon said non est approval as invalid. As such, impugned initiation of assessment proceeding is itself non est and deserves to be quashed. 5. That the Ld. CIT(A) had erred both in law and on facts by upholding impugned assessment proceeding u/s 147 of the act without appreciating the fact that impugned assessment order dated 26.03.2025 passed u/s 147 of the act, has been passed in gross contravention of Faceless Assessment Scheme prescribed u/s 144B of the act read with CBDT Order dated 22.09.2021 bearing F. No. 187/3/2020 ITA I, whereby, it has been prescribed that all assessments except specifically prescribed in said order shall be completed in faceless manner. As such, impugned assessment being nowhere specifically covered by exceptions prescribed in aforesaid CBDT Order 0R

5 ITA No. 822/Del/2026 Varun Gupta

exempted by way of provisions prescribed u/s 144B(8) of the act, has been completed in pure contravention of applicable statute and thereby, deserves to be quashed. 6. That the Ld. CIT(A) had erred both in law and on facts by upholding the initiation of impugned assessment proceeding on the basis of borrowed satisfaction being Ld. AO had solely relied on the information received from the office of Ld. DDIT (Inv.) 2, Chandigarh (hereinafter referred as Ld. DDIT (Inv.)). As such, impugned assessment proceeding is bad in law and deserves to be quashed. 7. That the Ld. CIT(A) had erred in law and facts of the matter by confirming the addition of Rs. 1,00,00,000/ made u/s 69 of the act on account of alleged cash payment to M/s. Omaxe Ltd. without appreciating the fact that the Ld. AO had made said addition without confronting appellant with complete material relied upon including seized material namely Hard disks A35/A27 seized during the search operations on Omaxe Group, which is in contravention of the decision of the Honble Apex Court in the case of UOI v. Ashish Agarwal reported in 444 ITR 1, wherein in case of proceedings-initiated u/s 148 of the Act has issued a categorical direction in Para 8(i) that the Ld. AO is duty bound to provide all the information and material to the assessee and therefore, impugned proceedings are initiated without jurisdiction. 8. That the Ld. CIT(A), has erred both in law and on facts in upholding an addition of Rs. 1,00,00,000/ representing alleged cash payment to M/s. Omaxe Ltd and brought to tax u/s 69 r.w.s. 115BBE of the act without appreciating the fact of the matter that actually, no cash payment has been made but relied upon material itself indicate that Adjustment has been made i.e. funds already invested in earlier years in other project of said group has been adjusted against indicated unit and thereby, in no case, section 69 of the act is invokable in the matter in hand being no cash has actually been paid during the period under consideration. As such, impugned additions made u/s 69 of the act deserves to be deleted. 9. That the Ld. CIT(A) had erred in law by passing impugned appellate order dated 03.11.2025 in gross contravention of principle of natural justice without appreciating the fact that the appellant was prevented by reasonable cause in non-filing of detailed submission before Ld. CIT(A) as he was under undue stress due to health issues concerning his father. As such, this appeal

6 ITA No. 822/Del/2026 Varun Gupta

may please be restored back to the file of Ld. CIT(A) for adjudication of matter on merits of the case.” 6. We have heard the learned AR and the learned DR. The Ld. AR would submit that the impugned order has resulted into miscarriage of justice as principle of natural justice has not been followed because no effective opportunity of hearing was given as the assessee had never received the notice after 15.09.2025 when adjournment was sought and therefore the matter may be restored to the file of the Ld. CIT(A) for deciding afresh. Learned DR on the other hand while supporting the judgment of the learned CIT(A) has left to the discretion of the court to consider the submissions of the assessee as per law.

“250(2) The following shall have the right to be heard at the hearing of the appeal- (a) the appellant, either in person or by an authorized representative;” 8. Thus, the hearing mandated by Section 250(2)(a) of the Act is not a mere formality but a mandatory statutory requirement for following the principle of natural justice by the quasi-judicial authority.

7 ITA No. 822/Del/2026 Varun Gupta