KISHAN SUMNABHAI JIVRAJANI ,RAJKOT vs. INCOME TAX OFFICER 2(1)(1),, RAJKOT

ITA 311/RJT/2026Status: DisposedITAT Raipur29 September 2026AY 2022-234 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal, considering the facts and circumstances and in the interest of substantial justice, decided to restore the issue to the file of the Assessing Officer for fresh examination. The AO was directed to re-examine the issue after providing the assessee with an adequate opportunity to be heard. The assessee was granted liberty to produce all relevant supporting documents to substantiate the purchases. The AO was to pass an appropriate order thereafter, considering the evidence furnished. This decision was applied mutatis mutandis to the appeal for Assessment Year 2022-23, as the issue was identical and interconnected. The ratio decidendi is that where an assessee claims an opportunity to present evidence was not effectively utilized before lower appellate authorities, the appellate tribunal may remand the matter to the AO for fresh consideration to ensure substantial justice.

What were the facts?

The assessee, Kishan Sumnabhai Jivrajani, is engaged in commodity trading. For Assessment Year 2021-22, the assessee declared a total income of Rs. 38,09,330/-. The Assessing Officer (AO) observed purchases of Rs. 18,56,90,202/- from Dhananjay Hari Bhau Dake, a salaried employee, with no payments made during the year. The AO treated these purchases as bogus and made an addition of Rs. 18,56,90,202/-, determining the total income at Rs. 18,94,99,532/-. The National Faceless Appeal Centre (NFAC) dismissed the assessee's appeal. A similar issue arose for Assessment Year 2022-23. The assessee appealed to the Income Tax Appellate Tribunal (ITAT) against the NFAC's order.

What were the issues?

1. Whether the purchases amounting to Rs. 18,56,90,202/- made from Dhananjay Hari Bhau Dake for Assessment Year 2021-22 are genuine, turning on the provisions of Section 143(3) read with Section 144B of the Income-tax Act, 1961. Assessee's contention: The assessee argued that it could not be properly represented before the NFAC and sought an effective opportunity to substantiate the purchases by producing supporting documents. Revenue's contention: The Revenue supported the orders of the lower authorities, asserting that the transactions were found to be bogus and the assessee failed to establish their genuineness.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Rajkot Bench, Rajkot

Before: Dr. Arjun Lal Saini & Shri Sonjoy Sarma

For Appellant: Shri Rajendra Singhal, Ld. AR
For Respondent: Shri Ravinder Sindhu, Ld. CIT(DR)
Hearing: 28/09/2026Pronounced: 29/09/2026

Per, Shri Sonjoy Sarma, JM: Captioned these appeals filed by the assessee in ITA No. 687/Rjt/2026 relates to Assessment Year 2021-22 and is directed against the order of the National Faceless Appeal Centre [hereinafter referred to as ‘NFAC’] dated 17.07.2026, arising out of the assessment order passed under section 143(3) read with section 144B of the Income-tax Act, 1961 Income-tax Act, 1961 [hereinafter referred to as ‘the Act’] dated 27.12.2022 an

The order continues below.

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