SUDHIR RAWAT ,JABALPUR vs. INCOME TAX OFFICER WARD-1(3), JABALPUR

ITA 250/JAB/2025Status: DisposedITAT Jabalpur30 September 2026AY 2011-127 pages
AI SummaryAllowed

What were the facts?

The assessee, Sudhir Rawat, filed an appeal against an ex-parte order dated 24.03.2025 passed by the Addl/Joint Commissioner of Income-tax (Appeals)-12, Delhi, for Assessment Year 2011-12. The appeal before the Tribunal was filed 90 days after the due date, with the assessee seeking condonation of delay due to changes in his registered email ID and mobile number on the Income Tax Portal. The Assessing Officer (AO) had issued a notice u/s 148 on 20.05.2013, followed by notices u/s 142(1) which were not effectively served or complied with. The AO made additions of Rs. 1,00,000 towards alleged unverifiable expenditure and Rs. 9,30,000 on account of capital gains under Section 50C, increasing the total income from Rs. 7,05,930 to Rs. 17,35,930. The Ld. CIT(A) dismissed the assessee's appeal ex-parte.

What did the Tribunal hold?

The Tribunal held that the Ld. CIT(A) had dismissed the assessee's appeal ex-parte. The assessee contended that notices from the Ld. CIT(A) were not received, preventing them from representing their case. The Tribunal acknowledged that appellate proceedings should ordinarily be decided after providing a reasonable and effective opportunity of hearing, and the right of appeal is a substantive legal right. Depriving an assessee of this right due to non-appearance, especially when there's an explanation of non-receipt of notices, is not permissible. The issues raised by the assessee, concerning the Rs. 1,00,000 expenditure addition and the Rs. 9,30,000 addition under Section 50C (including the opportunity under Section 50C(2)), required examination on merits. Since the Ld. CIT(A) had not decided the matter on merits, the Tribunal, to sub-serve the principles of natural justice, set aside the impugned order. The appeal was restored to the file of the Ld. CIT(A) to be decided afresh by way of a speaking order on merits after the assessee co-operates and furnishes relevant evidence. The grounds raised were allowed for statistical purposes.

What were the issues?

1. Whether the Ld. CIT(A) erred in passing an ex-parte order without duly appreciating that the appellant did not receive the notices and thus was not aware of the proceedings, contrary to the principles of natural justice? 2. Whether the Ld. CIT(A) was justified in confirming the addition of Rs. 1,00,000 made by the AO without specifically pointing out any unverifiable expenditure or demonstrating its non-relation to the assessee's professional activities, especially when the assessee offered a net profit of approximately 60%? 3. Whether the Ld. CIT(A) was justified in confirming the addition of Rs. 9,30,000 made by the AO without appreciating that the statutory right granted to the appellant under Section 50C(2) of the Income Tax Act, 1961, to request a reference to the Valuation Officer, was not afforded? Assessee's Contentions: The Ld. Counsel for the assessee argued that the Ld. CIT(A) passed an ex-parte order without the assessee receiving notices, thus preventing effective representation. The addition of Rs. 1,00,000 was ad-hoc and estimated without identifying specific unverifiable expenses, and the net profit offered was already high. Regarding the Rs. 9,30,000 addition, the AO invoked Section 50C without affording the assessee the opportunity under Section 50C(2) to refer the matter to the Departmental Valuation Officer. The assessee prayed for the ex-parte order to be set aside and the assessment to be framed afresh. Revenue's Contentions: The Ld. Departmental Representative supported the orders of the authorities below, stating that multiple opportunities were granted to the assessee, but the assessee failed to respond, indicating negligence.

Which sections of the Income-tax Act were involved?

Section 143(2),Section 148,Section 142(1),Section 147,Section 143(3),Section 50C,Section 50C(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JABALPUR BENCH “SMC”, JABALPUR

Before: SHRI KUL BHARAT

For Appellant: Shri Sapan Usrethe, Advocate
For Respondent: Shri Rahul Padha, JC-2

PER KUL BHARAT, VICE PRESIDENT.:

This appeal, by the assessee, is directed against the order of the Learned Addl/Joint Commissioner of Income-tax (Appeals)- 12, Delhi [Addl/JCIT(A)] dated 24.03.2025 pertaining to the assessment year 2011-12. The assessee has raised the following grounds of appeal: -

“1. The learned Commissioner of Income Tax (Appeals) erred in passing an ex-parte order on the grounds that the appellant did not bother to pursue the appeal, without duly appreciating that appellant was not aware of the notice as he have not received any notices

2.

The learned Commissioner of Income tax (Appeal) was not justified in dismissing the appeal without appreciating that notice under section 143(2) of the

The order continues below.

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