BHAVESH HARIBHAI MUNDIYA,RAJKOT vs. ITO WD 2(2)(1), RKT, RAJKOT

ITA 765/RJT/2026Status: DisposedITAT Raipur23 September 2026AY 2013-20145 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the matter requires examination on merits, considering the explanation furnished by the assessee regarding the death of his father and his prolonged illness. The CIT(A) had dismissed the appeal on the ground of delay without adjudicating the issues on merits. In the interest of justice, the Tribunal deemed it appropriate to restore the matter to the file of the Assessing Officer for fresh adjudication. The Assessing Officer is directed to examine all issues arising from the assessment order dated 18.05.2023 passed under Section 147 of the Act and decide them afresh after providing a reasonable and effective opportunity of being heard to the assessee. The assessee is also directed to cooperate and furnish all relevant documents. Consequently, the quantum appeal (ITA No. 865/Rjt/2026) is allowed for statistical purposes. For the connected penalty appeal (ITA No. 765/Rjt/2026), since the quantum assessment is restored, the penalty proceedings also require reconsideration. The penalty order is accordingly restored to the file of the Assessing Officer for fresh decision in accordance with law, after giving the assessee a reasonable opportunity of hearing. Both appeals are allowed for statistical purposes.

What were the facts?

The assessee, Bhavesh Haribhai Mundiya, is an individual who filed his return of income for Assessment Year 2013-14 declaring Rs.1,98,090/-. The Assessing Officer (AO) reopened the assessment under Section 147 of the Income-tax Act, 1961, alleging the assessee was a beneficiary of accommodation entries amounting to Rs.4,30,77,687/- provided by Jignesh Shah and Sanjay Shah. The AO issued notices under Sections 148 and 142(1), and a show-cause notice, but the assessee remained non-compliant. Consequently, the AO added Rs.4,30,77,687/- as unexplained money under Section 69A and completed the assessment at Rs.4,32,75,777/-. Penalty proceedings under Section 271(1)(c) were also initiated. The assessee's appeal before the CIT(A) was dismissed due to delay. The assessee then filed two appeals (ITA Nos. 765 & 865/RJT/2026) before the ITAT against the CIT(A)'s orders.

What were the issues?

1. Whether the Income Tax Appellate Tribunal (ITAT) should grant the assessee an opportunity to present his case on merits before the Assessing Officer, considering the delay in filing the appeal before the CIT(A) was due to the demise and prolonged illness of his father, and the assessee's inability to effectively participate in assessment proceedings? (Question of mixed law and fact, concerning principles of natural justice and procedural fairness). Assessee's Contention: The assessee argued that the delay in filing the appeal before the CIT(A) was unintentional and caused by personal circumstances (father's demise and illness), preventing effective participation in assessment proceedings. The assessee requested a fresh opportunity to present their case before the Assessing Officer. Revenue's Contention: The Ld. DR supported the order of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 142(1),Section 69A,Section 271(1)(c),Section 132

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 Vipul Chauhan , Ld. AR
For Respondent: Shri Ravinder Sindhu, Ld. CIT(DR)
Hearing: 21/09/2026Pronounced: 23/09/2026

Per, Shri Sonjoy Sarma, JM: Captioned both these appeals are preferred by the same assessee against separate orders of the Ld. Commissioner of Income-tax (Appeals) [hereinafter referred to as “Ld.CIT(A)”], dated 08.04.2026, arising out of separate proceedings for the same assessment year. ITA No. 865/Rjt/2026 is directed against the order of the Ld. CIT(A) dated 08.04.2026, arising from the assessment order dated 18.05.2023 passed under section 147 of the Income-tax Act, 1961 ("the Act"). ITA No. 765/Rjt/2026 i

The order continues below.

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