GHANSHYAM JEWELLERS,AHMEDABAD vs. INCOME TAX OFFICER, WARD 1(2)(1), AHMEDABAD, AHMEDABAD

ITA 1750/AHD/2026Status: DisposedITAT Ahmedabad30 September 2026AY 2017-20184 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal observed that the Ld. CIT(A) had provided multiple opportunities to the assessee to furnish details and explanations, but the assessee failed to comply. Consequently, the appeal was disposed of ex parte. However, the Tribunal, considering the interest of justice and the assessee's plea for an opportunity to present its case, decided to restore the matter to the file of the Ld. CIT(A) for adjudication de novo. The assessee was directed to furnish all relevant documents, evidence, explanations, and submissions without unnecessary adjournments. The Ld. CIT(A) was instructed to examine these and adjudicate all grounds raised by the assessee, including the additions under Sections 69A and 69C, undisclosed profit, the applicability of Section 115BBE, and consequential interest under Sections 234B and 234C, in accordance with the law. The ratio decidendi is that when an appeal is dismissed ex parte due to non-compliance, and a reasonable explanation for non-compliance is offered, coupled with a request for a fresh opportunity to present the case, the appellate authority should consider restoring the matter to the file of the lower authority for a proper adjudication on merits, in the interest of justice. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Ghanshyam Jewellers, a partnership firm dealing in gold and jewellery, filed its return for Assessment Year 2017-18. The Assessing Officer (AO) made additions totaling Rs. 53,15,000 under Section 69A for unexplained money deposited during demonetization, Rs. 14,08,900 under Section 69C for unaccounted purchases, and Rs. 87,709 as profit on unaccounted sales. The assessee's explanation that the cash deposits originated from earlier sales was not accepted due to a significant jump in cash sales in October 2016, bills lacking customer details, and the firm's failure to provide supporting documents like supplier ledgers and cash books. The assessee also did not reply to the show cause notice. Aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)], who dismissed the appeal ex parte for non-compliance.

What were the issues?

1. Whether the Ld. CIT(A) erred in law and facts by passing an ex parte order dismissing the appeal without considering the grounds on merit, solely on the ground of not furnishing submissions? (Mixed law and fact, relying on principles of natural justice and procedural fairness). 2. Whether the Ld. CIT(A) erred in law and facts by passing an ex parte order without considering the statement of facts presented in the appeal memo? (Mixed law and fact, concerning procedural compliance). 3. Whether the Ld. CIT(A) erred in law and facts by not considering the grounds of appeal concerning additions made by the AO under Section 69A (Rs. 53,15,000), Section 69C (Rs. 14,08,900), and for undisclosed profit (Rs. 87,709)? (Mixed law and fact, concerning the merits of the AO's additions). 4. Whether the Ld. CIT(A) erred in law and facts by not considering the grounds regarding the explanation of demonetization period deposits as cash sales, the applicability of Section 115BBE, and the non-consideration of documentary evidence? (Mixed law and fact, concerning the validity of the AO's assessment and the assessee's evidence). 5. Whether the Ld. CIT(A) erred in law and facts by not considering the grounds for addition of Rs. 87,709 as undisclosed profit? (Mixed law and fact, concerning a specific addition). 6. Whether the Ld. CIT(A) erred in law and facts by not considering the ground that the assessee was not provided with a copy of the statement recorded during survey proceedings, which formed the basis of the AO's addition? (Mixed law and fact, concerning procedural fairness and evidence). 7. Whether the Ld. CIT(A) erred in law and facts by not considering that no addition ought to have been made and the return of income should have been accepted without variation? (Mixed law and fact, concerning the overall assessment). 8. Whether the Ld. CIT(A) erred in law and facts by not considering that interest under Section 234B (Rs. 17,24,547) and Section 234C (Rs. 3283) ought not to have been levied? (Mixed law and fact, concerning consequential interest). Assessee's Contentions: The Ld. Counsel for the assessee argued that the Ld. CIT(A) passed an ex parte order without considering the grounds of appeal on merit and the statement of facts. The assessee also contended that the demonetization period deposits were explained by cash sales with documentary evidence, and that they were not provided with a copy of the survey statement. The assessee sought an opportunity to furnish all relevant details and documents. Revenue's Contentions: The judgment records no specific contentions from the Revenue. However, the facts indicate the Revenue, through the AO, made additions based on perceived discrepancies and lack of evidence from the assessee.

Which sections of the Income-tax Act were involved?

Section 250,Section 69A,Section 69C,Section 115BBE,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

For Appellant: Shri PF Jain, AR
For Respondent: Shri Sanjeev Bhagat, Sr. DR
Hearing: 23.09.2026Pronounced: 30.09.2026

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:

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This appeal has been filed by the Assessee against the order dated 16.06.2026 passed by the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, Delhi (hereinafter referred to as ‘Ld. CIT (A)’ in short), under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’ in short) for Assessment Year 2017- 2018. ITA No.1750/AHD/2026, AY-2017-18 Ghanshyam Jewellers - 2–

2.

The Assessee has raised the following grounds of Appeal:-

1.

The Ld. CIT(A), NFAC has erred in law and on facts in passing ex party appeal order dismissing the appeal on the ground of not furnishing submissions without considering the gro

The order continues below.

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