PRASHANTHI DUGGI,NEW YORK vs. ITO, INT. TAX -1, HYDERABAD

PDF · subscribers
ITITA 106/DEL/2026Status: DisposedITAT Delhi28 July 2026AY 2017-185 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the assessment order was passed ex-parte, which prevented the assessee from presenting all relevant details and documents to the AO. Considering the principles of natural justice, the Tribunal was of the view that the assessee should be provided one more opportunity. Accordingly, the case was remanded back to the file of the AO for a denovo assessment. The AO was directed to take into consideration all relevant papers and documents filed by the assessee and to provide an adequate opportunity to the assessee as required by law. The assessee was directed to cooperate with the revenue in finalizing the assessment. The Tribunal did not decide on the merits of the additions or other grounds raised in the appeal. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Prashanthi Duggi, filed an appeal against the assessment order dated 28.01.2026 passed by the ITO, Ward International Taxation-1(2)(2), Delhi for Assessment Year 2017-18. The case was reopened under Section 147 of the Income Tax Act, 1961, due to alleged foreign remittances, purchase of foreign currency, cash deposits, and non-filing of the return of income. The Assessing Officer (AO) passed an ex-parte assessment order under Section 144 after the assessee did not comply with the notice issued under Section 148. The assessee contended that the assessment order was passed ex-parte, preventing her from submitting all relevant details. The Dispute Resolution Panel (DRP) also issued directions. The total income was determined at Rs. 3,25,33,832/- with additions including Rs. 73,33,000/- under Section 69A, Rs. 2,09,37,187/- under Section 69C, and Rs. 40,35,000/- under Section 69A.

What were the issues?

1. Whether the assessment order passed by the ITO, Ward Int. Tax 1(2)(2), Delhi is without jurisdiction and liable to be quashed, as argued by the assessee. The revenue relied on the authorities below. 2. Whether the draft assessment order, directions by the DRP, and the impugned assessment order determining the total income at Rs. 3,25,33,832/- are erroneous and bad-in-law, as contended by the assessee. The revenue relied on the authorities below. 3. Whether the remand report, DRP directions, and consequent assessment order are invalid and bad in law due to being given without considering facts or on a biased notion, as argued by the assessee. The revenue relied on the authorities below. 4. Whether the AO/DRP erred in making an addition of Rs. 73,33,000/- under Section 69A on account of alleged foreign remittance, without examining material/evidence and against principles of natural justice, as argued by the assessee. The revenue relied on the authorities below. 5. Whether the AO/DRP erred in making an addition of Rs. 2,09,37,187/- under Section 69C on account of alleged purchase of foreign currency, without examining material/evidence and against principles of natural justice, as argued by the assessee. The revenue relied on the authorities below. 6. Whether the AO/DRP erred in making an addition of Rs. 40,35,000/- under Section 69A on account of cash deposited, with wrong observations against facts and law, as argued by the assessee. The revenue relied on the authorities below. 7. Whether the AO/DRP erred in making an addition of Rs. 2,28,645/- on account of interest earned, as argued by the assessee. The revenue relied on the authorities below. 8. Whether the AO erred in not allowing TDS credit of Rs. 70,656/-, as argued by the assessee. The revenue relied on the authorities below. 9. Whether the AO erred in charging interest under Section 234A, as argued by the assessee. The revenue relied on the authorities below. 10. Whether the AO erred in charging interest under Section 234B, as argued by the assessee. The revenue relied on the authorities below. 11. Whether the AO erred in initiating penalty proceedings under Section 270A/271AAC, as argued by the assessee. The revenue relied on the authorities below.

Which sections of the Income-tax Act were involved?

Section 147,Section 148A,Section 148,Section 144,Section 69A,Section 69C,Section 234A,Section 234B,Section 270A,Section 271AAC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘D’ NEW DELHI

Before: SH. VIKAS AWASTHY & SH. KRINWANT SAHAY

For Respondent: Dr. Shalini Verma, CIT DR
Hearing: 03.06.2026Pronounced: 28.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘D’ NEW DELHI BEFORE SH. VIKAS AWASTHY, JUDICIAL MEMBER AND SH. KRINWANT SAHAY, ACCOUNTANT MEMBER

IT(IT)A.106/DEL/2026 (A.Y 2017-18) Prashanthi Duggi, Vs. ITO, 11766, 127th Street, South Int. Tax-1, Ozone Park, Hyderabad New York -11420 USA PAN No.CMSPD1624B Appellant by: Sh. Sbubham Jain, CA Respondent by : Dr. Shalini Verma, CIT DR

Date of Hearing 03.06.2026 Date of Pronouncement 28.07.2026

ORDER PER KRINWANT SAHAY AM

Appeal in this case has been filed by the assessee against the order dated 28.01.2026 passed by the AO, Ward International Taxation-1(2)(2), Delhi for the A.Y. 2017-18 Grounds of appeal are as under :- 1. That on the facts and circumstances of the case and in law, the impugned assessment order passed by ITO, Ward Int. Tax 1(2)(2), Delhi (the Id. A.O.) is without jurisdiction and therefore, the assessment order is liable to be quashed.

1 | P a g e

2.

That on the facts and circumstances of the case and in law, the draft assessment order passed by the Ld. A.O., directions given by Dispute Resolution Panel (Hon'ble DRP) and the impugned assessment order passed by the Ld. A.O. determining the total income of the appellant at Rs. 3,25,33,832/-is erroneous and bad-in-law. 3. That on the facts and circumstances of the case and in law, remand report given by the Ld. A.O. and directions given by Dispute Resolution Panel (Hon'ble DRP) and consequent assessment order passed by the Ld. A.O, is invalid and bad in law as the same has been given without considering the facts of the case rather than contrary to the facts of the case and on pre biased notion. 4. That on the facts and circumstances of the case and in law, the ld. assessing officer/ Hon'ble DRP erred in making addition of Rs. 73,33,000/- u/s 69A of the Act on account of alleged foreign remittance made by the assessee which is unjustified, bad in law and uncalled for and without examine the material/evidence placed on record and is against the principles of natural justice. 5. That on the facts and circumstances of the case and in law, the ld. Assessing officer/ Hon'ble DRP erred in making addition of Rs. 2,09,37,187/-u/s 69C the Act on account of alleged purchase of foreign currency which unjustified, bad in law and uncalled for and without examine the material/evidence placed on record and is against the principles of natural justice. 6. That on the facts and circumstances of the case and in law, the Id. assessing officer/ Hon'ble DRP erred in making addition of Rs. 40,35,000/- u/s 69A of the Act on account of cash deposited by the assessee. In this regard all their observations are wrong and against the facts and law. 7. That on the facts and circumstances of the case and in law, the Id. assessing officer/ Hon'ble DRP erred in making addition of Rs. 2,28,645/- on account of interest earned by the assessee. 8. That the Ld. A.O. has erred in not allowing the TDS credit of Rs. 70656/-.

2 | P a g e

9.

On the facts and circumstances of the case and in law, the Id. assessing officer erred in charging interest u/s 234A of the Act. 10. On the facts and circumstances of the case and in law, the Id. assessing officer erred in charging interest u/s 234B of the Act. 11. On the facts and circumstances of the case and in law, the ld. assessing officer erred in initiating penalty proceedings u/s 270A/271AAC of the Act. 12. The above ground of appeal is without prejudice to one another. 13. The appellant craves the right to add, amend, alter, withdraw or forgo any ground or grounds of appeal before or at the time of hearing.

3.

During proceedings before us the Ld. Counsel for the assessee has filed a written submission and he argued on the line of his submissions filed before us. 4. The brief facts of the case are as under :- The case of the assessee was reopened u/s 147 of the Income Tax Act, 1961(hereinafter referred to as the “Act”) for the A.Y. 2017-18. The reason for reopening the case u/s 147 of the Act as enumerated in order u/s 148A(d) of the Act is elaborated as under: - i) Purchase of foreign currency amounting to Rs. 2,09,37,187/-. ii) Time deposit amounting to Rs. 0 iii) Receipt of remittance by a non-resident or by a foreign company (15CA) amounting to Rs. 73,33,000/- iv) Cash deposits in one or more accounts (other than a current account and time deposit) of a person amounting to Rs. 40,35,000/- v) Remittance to a non-resident or to a foreign company (Form 15CA) amounting to Rs. 73,33,000/-. vi) TDS Statement - Payment made to non-residents (Section 195) of Rs. 1,48,398/-. vii) TDS Statement - Payment made to non-residents (Section 195) of Rs. 80,247/-. 3 | P a g e

2.

The assessee had entered into with above mentioned transactions and did not file her return of income for the A.Y. 2017-18. Since the assessee had not filed her ITR for the relevant A.Y. 2017-18, the transactions made by the assessee remained unexplained and escaped assessment. Consequently, order u/s 148A (d) dated 31.03.2024 was passed after giving due opportunity to the assessee and after taking due approval of the competent authority as detailed in the order passed u/s 148A(d). 3. Subsequently, the case of the assessee was reopened within the meaning of section 147 of the Act and notice dated 31.03.2024 u/s 148 of the Act was issued to the assessee. The assessee did not comply to the above notice and has not filed her return of Income.

5.

The Ld. Counsel for the assessee brought it to the notice of the Bench that the assessment order in this case has been passed exparte u/s.144 and, therefore, the assessee could not bring on record all the relevant details and documents for consideration before the AO. 6. On the other hand the Ld. DR relied on the of the authorities below. 7. We have considered the findings given by the AO in the exparte order passed on 28.01.2026 and we have also considered the written submission filed by the Ld. Counsel for the assessee during proceedings before us. We are of this considered view that in order to have natural justice to the assessee one more opportunity should be provided to the assessee. Accordingly, we remand this case back to the file of the AO for denovo order after taking into consideration all the relevant papers and documents filed by the assessee. The AO is also directed to give adequate opportunity to the assessee as required under law. The assessee

4 | P a g e

is directed to cooperate with the revenue in finalizing the assessment order. 8. In the result, the appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the Court on 28.07.2026.

SD/- .

Sd/- Sd/-

(VIKAS AWASTHY) (KRINWANT SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBR Dated :28/07/2026 *Neha Sr. PS* Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT

ASSISTANT REGISTRAR ITAT NEW DELHI

5 | P a g e

More judgments on Section 147

All 49,210 judgments and leading authorities on Section 147 →

Recent GST High Court judgments

Search GST case law →