MANISHKUMAR JAYANTILAL SONI,KAPADWANJ vs. INCOME TAX OFFICER, WARD -1 , NADIAD., NADIAD.

ITA 558/AHD/2026Status: DisposedITAT Chandigarh29 September 2026AY 2012-136 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the approach adopted by the Learned CIT(A) was untenable and could not be countenanced. The Tribunal found that the CIT(A) dismissed the appeal on two grounds: (i) the assessee opting for the Direct Tax Vivad se Vishwas Scheme, 2024 (DTVSV 2024), implying an admission of the addition, and (ii) the assessee's failure to prosecute the appeal. The Tribunal clarified that under Section 250(6) of the Act, the CIT(A) is required to adjudicate the appeal by a written order stating the points for determination, the decision, and the reasons, even if the assessee fails to appear or make proper representations, citing CIT vs. Premkumar Arjundas Luthra (HUF). Furthermore, the Tribunal held that opting for the DTVSV, 2024 does not amount to an admission or concession of liability. The Tribunal set aside the impugned order of the CIT(A) and directed the CIT(A) to adjudicate the appeal afresh as per law. The assessee was granted liberty to raise all legal contentions, including those challenging the reopening under Section 147/148 and the validity of approval under Section 151. The assessee was directed to cooperate, produce all relevant documents without unnecessary adjournments, and a reasonable opportunity of being heard was to be granted. The Tribunal allowed grounds 1 to 6 for statistical purposes without returning any findings on the merits of the addition. No issue was expressly left undecided.

What were the facts?

The assessee, Manishkumar Jayantilal Soni, filed an appeal before the Income Tax Appellate Tribunal (ITAT) against an order dated 02/12/2025 passed by the National Faceless Appeal Centre (NFAC), Delhi (CIT(A)). The CIT(A) had dismissed the assessee's appeal against an assessment order dated 05/12/2019, passed under Section 144 of the Income Tax Act, 1961 (the Act), for Assessment Year 2012-2013. The original assessment order was passed under Section 144 read with Section 147 of the Act. The Assessing Officer (AO) initiated reassessment proceedings based on information about the assessee's transaction of sale of ‘Gawar’. The AO proposed an addition of Rs. 46,50,546/-. The assessee did not respond to notices, and a show-cause notice was issued. The assessee responded with a bank statement, but the AO held that no explanation or supporting evidence was provided, adding the amount as unexplained cash credit. The CIT(A) dismissed the appeal, noting the assessee's opting for the Vivad se Vishwas scheme, inability to pay taxes due to liquidity crunch, and failure to prosecute the appeal on merits.

What were the issues?

1. Whether the reasons for reopening and the belief formed were invalid, rendering the notice issued under Section 148 of the Act void and invalid in law, as argued by the assessee? 2. Whether the approval granted under Section 151 of the Act was mechanical, as contended by the assessee? 3. Whether the Assessment Order dated 05-12-2019 is void and bad in law due to fundamental contradictions, specifically mentioning it was passed under Section 144 r.w.s. 147 and also under Section 143(3) r.w.s. 147 of the Act, as submitted by the assessee? 4. Whether the addition of Rs. 46,50,546/- as unexplained cash credit is invalid and unsustainable in law, given that the show-cause notice proposed adding this amount as interest received in the course of business transactions, according to the assessee? 5. Whether the addition of Rs. 46,50,546/- for the Assessment Year 2012-2013 is invalid and unsustainable in law, as the amount was received by the assessee in Financial Year 2015-16, as argued by the assessee? Assessee's Contentions: The assessee argued that the reopening reasons and belief were mechanical and invalid. They also argued that the approval under Section 151 was mechanical and that the assessment order was void due to contradictory provisions cited. The assessee contended that the addition was unsustainable as the show-cause notice mentioned interest received, not cash credit, and that the amount was received in a subsequent financial year. The assessee relied on no specific authorities or precedents in the provided text. Revenue's Contentions: The revenue did not present specific arguments in the provided text. The CIT(A)'s order, however, dismissed the appeal, citing the assessee's opting for the Vivad se Vishwas scheme, inability to pay taxes, and failure to prosecute the appeal, referencing cases like Estate of Late Tukojirao Holkar vs. CWT, New Diwan Oil Mills vs. CIT, and CIT vs. B. Bhattachargee & Another.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 148,Section 151,Section 143(3),Section 68,Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SMC” BENCH, AHMEDABAD

Per Rahul Chaudhary, Judicial Member:

1.

The present appeal has been preferred by the Assessee against the Order, dated 02/12/2025, passed by the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as the ‘CIT(A)’] whereby the Learned CIT(A) had dismissed the appeal against the Assessment Order, dated 05/12/2019, passed under Section 144 of the Income Act, 1961 [hereinafter referred to as ‘the Act’] for the Assessment Year 2012-2013. 2. The Assessee has raised the following grounds of appeal:

1.

The reasons for reopening have been recorded and belief in this regard has been formed in

The order continues below.

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