DEPUTY COMMISSIONER OF INCOME TAX, NOIDA vs. RAHUL GAUR, DELHI

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ITSSA 1121/DEL/2025Status: DisposedITAT Delhi29 August 2025AY 2012-134 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal heard the Learned CIT-DR, who had little to say when queried about the Revenue's grievance when the assessment was remanded back to the AO for a fresh assessment. The assessee was not represented. Upon perusal of the material on record, and keeping in view the facts of the case in entirety, the Tribunal found no infirmity in the impugned order of the CIT(A). The Tribunal declined to interfere with the CIT(A)'s order. The principle is that if the lower appellate authority's order is found to be free from legal infirmity after considering the facts, the appellate tribunal should not interfere. The operative direction was to uphold the CIT(A)'s order of setting aside and remanding the case for fresh assessment.

What were the facts?

The Revenue is in appeal against the order of the CIT(A) dated 03.12.2024, for Assessment Year 2012-13. The Assessing Officer (AO) completed a search assessment ex-parte under section 144/153A of the Income Tax Act, 1961, after search and seizure operations on 09.10.2013 and issuance of notice under section 153A. The assessee, Rahul Gaur, failed to comply with statutory notices, including a final show cause notice, regarding the source of investment in shares and working of capital gains. The assessment was completed at an income of Rs. 6,00,78,000/-. The assessee appealed to the CIT(A), who set aside the assessment order and remanded the matter back to the AO for a fresh assessment denovo. The Revenue has challenged this order.

What were the issues?

1. Whether, on the facts and in law, the CIT(A) erred in setting aside the assessment order and directing the AO to make a fresh assessment, despite the AO having provided sufficient opportunities and issued statutory notices, including a final show cause notice, to the assessee (Section 251(1)(a) of the Act). 2. Whether the CIT(A) erred in accepting the assessee's plea for setting aside the assessment without reasonable grounds for the assessee's non-compliance during assessment proceedings. 3. Whether the CIT(A) erred in setting aside the assessment without appreciating that the AO had thoroughly examined the seized material and facts, and whether setting aside the case without reasonable grounds for assessee's failure is in accordance with Section 251(1)(a) of the Act. 4. Whether the CIT(A) erred in setting aside the assessment, disregarding that the final show cause notice allowed the assessee to respond to proposed findings, and that the assessee's failure to respond without reasonable grounds led to the assessment under Section 144 of the Act. Revenue's Contention: The CIT(A) erred in setting aside the assessment and remanding it for fresh assessment, as the AO had provided sufficient opportunities and the assessee failed to comply without reasonable grounds. The AO's assessment was based on thorough examination of seized material. Assessee's Contention: Not recorded as the assessee was not represented.

Which sections of the Income-tax Act were involved?

Section 132,Section 153A,Section 144,Section 251(1)(a)

AI-generated summary — verify with the full judgment below

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

For Appellant: Ms. Richa Gaharwal, CIT-DR
Hearing: 25/08/2025Pronounced: 29/08/2025

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’: NEW DELHI BEFORE SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI AVDHESH KUMAR MISHRA, ACCOUNTANT MEMBER IT(SS)A No.1121/Del/2025, A.Y. 2012-13 Dy. Commissioner of Income Rahul Gaur Tax, Central Circle Noida, A-989, BRYS Grounds, Income Tax Office, Vs. Sector-7, 2nd Floor, ARTO Building, Palam Extension, Sector-33, Noida, Dwarka, New Delhi Uttar Pradesh PAN: AGQPS5386H (Appellant) (Respondent) Appellant by Ms. Richa Gaharwal, CIT-DR Respondent by None Date of Hearing 25/08/2025 Date of Pronouncement 29/08/2025 ORDER PER AVDHESH KUMAR MISHRA, AM The appeal for the Assessment Year (‘AY’) 2012-13 filed by the Revenue is directed against the order dated 03.12.2024 of the Commissioner of Income Tax (Appeals)-3, Noida [‘CIT(A)’].

2.

Following grounds have been raised in this appeal by the Revenue: -

“1. Whether on facts and circumstances of the case and in law, Ld. CIT(A)-3, Noida has erred in setting aside the case with the direction to the AO for making a fresh assessment as per provisions of law, without appreciating the fact that the Assessing Officer while making the assessment has provided sufficient opportunities of being heard to the assessee by issuing number of statutory notices including final show cause notice.

ITA No.1121/Del/2025 Rahul Gaur, Delhi 2. Whether on facts and circumstances of the case and in law, Ld. CIT(A)-3, Noida has erred in accepting the plea of the assessee while setting aside the case, without there being any reasonable ground as brought on record for non-compliance by the assessee during the assessment proceedings. 3. Whether on facts and circumstances of the case and in law, Ld. CIT(A)-3, Noida has erred in setting aside the case, without appreciating the facts that the Assessing Officer has passed the assessment order after thoroughly examining and analyzing the seized material and proper appreciation of facts. The restoration of the case to the file of the Assessing Officer for making fresh assessment without narrating any reasonable ground for failure on the part of the assessee is not in accordance with the intent and spirit of provisions contained in section 251(1)(a), proviso of the Act. 4. Whether on facts and circumstances of the case and in law, Ld. CIT(A)-3, Noida has erred in setting aside the case disregarding the fact that final show cause notice provides the assessee to respond to the AO on proposed findings and additions. Failure on the part of the assessee in responding the statutory notices without any reasonable grounds, has resulted the assessment u/s 1-14 of the Act. 5. That the appellant craves 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.” 3. The relevant facts giving rise to this appeal are that the Assessing Officer (‘AO’) completed the search assessment ex-parte. The search & seizure operations under section 132 of the Income Tax Act, 1961 (‘Act’) have taken place on the assessee on 09.10.2013. Thereafter, the AO issued notice under section 153A of the Act to the assessee to file the return of income. During the course of assessment proceedings, the assessee was show-caused to explain the source of investment in share and working of capital gains on the sale of a plot. But the assessee failed to ensure any

ITA No.1121/Del/2025 Rahul Gaur, Delhi compliance of statutory notices; therefore, the AO had no option except to complete the assessment ex parte under section 144/153A of the Act. The search assessment was completed at income of Rs.6,00,78,000/-. Aggrieved the assessee filed appeal before the CIT(A), who set aside the assessment order and remanded the matter back to the AO for fresh assessment denovo. Aggrieved, the Revenue challenged the impugned order before us.

4.

We heard the Ld. CIT-DR. On specific query that what is the grievance of Revenue when the assessment has been remanded back to the AO to make a fresh assessment, the Ld. CIT-DR had not to say much. Before us, the assessee was not represented by anyone.

5.

We have perused the material available on the record. Keeping in view the facts of the case in entirety and without offering any comment on merit of the case, we do not see any infirmity in the impugned order. Hence, we decline to interfere with.

6.

In the result, the appeal of the Revenue stands dismissed.

Order pronounced in open Court on 29th August, 2025 Sd/- Sd/- (YOGESH KUMAR U.S.) (AVDHESH KUMAR MISHRA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 29/08/2025 Binita, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3

ITA No.1121/Del/2025 Rahul Gaur, Delhi 3. PCIT/CIT 4. CIT(Appeals) 5. CIT-DR: ITAT

ASSISTANT REGISTRAR ITAT, NEW DELHI

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