SHABDARTH,DELHI vs. DCIT, CIRCLE- 34(1), DELHI

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ITA 7260/DEL/2025Status: DisposedITAT Delhi23 September 2026AY 2022-235 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the CIT(A) dismissed the appeal without adjudicating the grounds on merits, primarily due to the assessee's failure to file written submissions and supporting documents despite opportunities. The Tribunal found that the issues raised by the assessee require examination on merits, considering relevant facts and documentary evidence. In the interest of justice, the Tribunal decided to restore the matter to the file of the CIT(A) for fresh adjudication. The assessee was directed to make necessary submissions and provide detailed material before the CIT(A) within 60 days of the order. The CIT(A) was directed to afford a reasonable and effective opportunity of being heard to the assessee. The Tribunal did not decide the grounds on merits in this order.

What were the facts?

The assessee, Shabdarth, filed a revised return of income for Assessment Year 2022-23 declaring a total income of Rs. 17,91,20,490/-. The case was selected for limited scrutiny, and the Assessing Officer (AO) completed the assessment under section 143(3) of the Income Tax Act, 1961, vide an order dated 27.03.2024. The AO made an addition of Rs. 94,57,65,069/- on account of a difference between reported receipts and Form 26AS, and a further addition/disallowance of Rs. 35,62,616/- for other expenses. The assessee appealed to the CIT(A)/NFAC, who dismissed the appeal on 19.09.2025, citing the assessee's failure to file written submissions or documents despite multiple opportunities. The assessee is now appealing this dismissal order to the ITAT.

What were the issues?

1. Whether the CIT(A)/NFAC erred in confirming the addition of Rs. 94,57,65,069/- under business income, by disregarding the assessee's submission that past year income was reflected in Form 26AS for the relevant assessment year and that Form 26AS included GST with services. 2. Whether the CIT(A)/NFAC erred in confirming the addition of Rs. 35,62,616/- on an ad-hoc basis at 12.5% of other expenses, treating them as bogus expenses under section 37 of the Act. 3. Whether the CIT(A)/NFAC erred in confirming the addition of Rs. 35,62,616/- by relying on the Gujarat High Court judgment in CIT vs. Simit P. Sheth, ignoring that the facts of the present case differ from the cited case. 4. Whether the CIT(A)/NFAC erred in confirming additions by recording incorrect facts and findings and without cross-verification of material. 5. Whether the CIT(A)/NFAC erred in confirming the addition of Rs. 94,57,65,069/- without mentioning the specific sections, sub-sections, or provisions of law under which the addition was made. Assessee's Contention: The issues are factual and require verification of books of account, Form 26AS, invoices, and other documents. The CIT(A) dismissed the appeal without adjudicating on merits due to non-filing of submissions, despite the assessee seeking adjournments. The assessee prays for one more effective opportunity for hearing and restoration to the CIT(A) for fresh adjudication. Revenue's Contention: The Revenue supported the order of the CIT(A).

Which sections of the Income-tax Act were involved?

Section 143(2),Section 142(1),Section 143(3),Section 37,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: Sh. Raj Kumar Chauhan&

Hearing: 10.09.2026Pronounced: 23.09.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’, NEW DELHI Before Sh. Raj Kumar Chauhan, Judicial Member & Sh. Amitabh Shukla, Accountant Member ITA No. 7260/Del/2025 : Asstt. Year : 2022-23 Shabdarth, Vs DCIT, Directorate of Information & Publicity Circle-34(1), Block No. Ix, Civil Lines, S.O. North New Delhi-110002 Delhi, Majnu Ka Tilla, Delhi-110054 (APPELLANT) (RESPONDENT) PAN No. AANAS0581N Assessee by: Sh. Kamlesh Chaurasiya, CA Revenue by: Sh. Vikram Singh Sharma, CIT-DR Date of Hearing: 10.09.2026 Date of Pronouncement: 23.09.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeal of the assessee is directed against the order dated 19.09.2025 of ld. CIT(A)/NFAC, Delhi passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein appeal has been dismissed on the ground that despite several opportunities, the assessee has only sought adjournment and not filed any written submission/document, against assessment order dated 27.03.2024.

2.

Brief facts as culled out from the orders of the authorities below are that the assessee filed its revised return of income for A.Y. 2022-23 on 31.10.2022 declaring total income of

2 ITA No. 7260/Del/2025 Shabdarth Rs.17,91,20,490/-. The case was selected for limited scrutiny under CASS and notices under sections 143(2) and 142(1) of the Act were issued. The Assessing Officer completed the assessment under section 143(3) of the Act vide order dated 27.03.2024 making an addition of Rs.94,57,65,069/- on account of alleged difference between receipts disclosed in the return of income and Form 26AS and an addition/disallowance of Rs.35,62,616/- in respect of other expenses.

3.

Aggrieved by the Assessment order, the assessee filed appeal before the ld. CIT(A) who dismissed the appeal, observing that despite several opportunities, the assessee had neither filed any written submissions nor furnished any supporting documents in support of the grounds raised in appeal.

4.

Aggrieved by the impugned order, the assessee is in appeal before us and has raised the following grounds of appeal:

“1. That the Ld CIT(A), NFAC has erred in confirming addition of Rs 94,5 7,65,069/- under business income due to difference between business receipts in ITR and Form 26AS, by ignoring submission that Past year income is reflecting in 26AS in the relevant Assessment Year and by ignoring the fact that data reflecting in 26AS is including of GST portion with Services.

3 ITA No. 7260/Del/2025 Shabdarth 2. That the Ld CIT(A), NFAC, has erred in confirming addition of Rs 35,62,616/-on adhoc basis @ 12.5% of other expenses under section 37 of the Income Tax, considering as bogus expenses. 3. That the Ld CIT(A), NFAC has erred in confirming addition of Rs 35,62,616/-on basis of reliance on judgment of Honorable Gujarat High Court, in case of CIT vs Simit P. Sheth, (2013) 38 taxmann.com 385 (Gujarat), by ignoring the facts that facts in our case and facts in given citation are different. 4. That the Ld CIT(A), NFAC has erred in confirming addition by recording incorrect facts and findings and without cross verification of the entire material used against the appellant. 5. That on the facts and circumstances, the Ld CIT(A), NF AC has erred in confirming addition of Rs.94,57,65,069/- without mentioning Sections, Sub sections, and provisions of law, under which section or subsection addition has done. 6. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.” 5. We have heard the ld. AR and the ld. DR. The ld. AR at the very outset submitted that the issues involved are essentially factual in nature and require verification of the books of account, Form 26AS, invoices, details of receipts and other supporting documents. The ld. AR further submitted that the Ld. CIT(A) issued notices on various dates and the assessee sought adjournment in response to the notices dated 04.04.2025 and 06.05.2025, whereas no response was made to the notice dated 07.08.2025. The Ld. CIT(A), therefore, dismissed the appeal in

4 ITA No. 7260/Del/2025 Shabdarth the absence of any written submission or supporting documents from the assessee. It is therefore prayed that, in the interest of justice, one more effective opportunity of hearing may be granted to the assessee and the matter may be restored to the file of the Ld. CIT(A) for fresh adjudication on merits.

6.

The ld. DR, on the other hand, supported the order of the ld. CIT(A).

7.

We have considered the rival submissions and examined the material on record. We have noticed the ld. CIT(A) in para 8.3 of the impugned order, has observed as under: “8.3 During the course of appellate proceedings, as is discussed above, neither the appellant nor his AR filed any written submission, despite getting several opportunities. It is pertinent to mention here that notices has been issued to the appellant from more than past 6 months, but the appellant has only sought adjournment and not bothered to file submission & relevant documents in respect of the grounds of appeal raised in this appeal. The conduct of the appellant indicates lack of interest in prosecuting this appeal. In this regard, reliance is placed on Gujarat High Court Judgment in case of Fairdeal Filaments Ltd vs. C.I.T. 302 ITR 173. Therefore, it is not required to give any further opportunity to the assessee.” 8. It is evident from the extract of the impugned order that the ld. CIT(A) dismissed the appeal without adjudicating the grounds raised by the assessee on merits, primarily on the ground that the assessee had not filed written submissions and

5 ITA No. 7260/Del/2025 Shabdarth supporting documents despite opportunities having been afforded. We find that the issues raised by the assessee require examination on merits after considering the relevant facts and supporting documentary evidence. In the interest of justice, we deem it appropriate to restore the matter to the file of the ld. CIT(A) for fresh adjudication in accordance with law, after affording reasonable and effective opportunity of being heard to the assessee. The assessee/appellant is also directed to make the necessary submissions/ detailed material before the ld. CIT(A) within the period of 60 days of this order.

8.

In the result, the appeal of the assessee is allowed for statistical purposes. Order Pronounced in the Open Court on 23/09/2026. Sd/- Sd/- (Amitabh Shukla) (Raj Kumar Chauhan) Accountant Member Judicial Member Dated: 23/09/2026 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR

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