GOVINDBHAI BHAVANDAS PATEL HUF,GANDHINAGAR, GUJARAT vs. ITO WARD 4(2)(1), AHMEDABAD, AHMEDABAD, GUJARAT

ITA 1462/AHD/2026Status: DisposedITAT Ahmedabad08 October 2026AY 2010-116 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessment order dated 08.03.2025 was passed in breach of the principles of natural justice because it was issued before the hearing date of 10.03.2025, which was fixed by the AO himself. This deprived the assessee of an effective opportunity to be heard in response to the show-cause notice. The Tribunal also noted that the proceedings were pursuant to a Tribunal order setting aside the matter for adjudication on merits, and thus, an effective and meaningful opportunity to present evidence and explanations was crucial. The Tribunal found that the assessee claimed to have furnished proof of donation and explanations for bank credits earlier and during the set-aside proceedings. These aspects require factual verification by the AO. Consequently, the Tribunal set aside the impugned order of the NFAC and the assessment order dated 08.03.2025, restoring the matter to the AO for fresh adjudication on merits. The AO was directed to examine the bank credits, source of funds, donation proof, and other relevant documents, providing an adequate opportunity of hearing. The issue of the DIN number was not explicitly decided but was implicitly addressed by setting aside the AO's order. The addition under Section 69A was not decided on merits but was to be re-examined.

What were the facts?

The assessee, Govindbhai Bhavandas Patel-HUF, is in appeal against the order of the NFAC, Delhi, dated 09.02.2026, which upheld the assessment order dated 08.03.2025 passed by the Assessing Officer (AO) under Section 143(3) r.w.s. 254 of the Income Tax Act, 1961, for Assessment Year 2010-11. The original assessment was completed under Section 144 r.w.s. 147 on 21.12.2017, determining income at Rs. 21,50,021/- due to unexplained bank credits. This was set aside by the ITAT on 26.07.2023, restoring the matter to the AO for fresh adjudication on merits, with a specific direction regarding proof of donation to the Prime Minister's Relief Fund. In the set-aside proceedings, the AO issued a notice under Section 142(1) on 23.01.2025 and a show-cause notice on 04.03.2025, fixing a hearing for 10.03.2025. However, the AO passed the assessment order on 08.03.2025, prior to the scheduled hearing.

What were the issues?

1. Whether the learned National Faceless Appeal Centre (NFAC) erred in dismissing the appeal on the ground that proof of donation of Rs. 50,000/- to the Prime Minister Relief Fund was not furnished to the AO, when the assessee contended it was furnished earlier and during the set-aside proceedings, thereby breaching principles of natural justice and preventing a decision on merits. 2. Whether the learned NFAC erred in upholding the assessment order passed by the AO, which was issued before the date fixed for hearing, thereby depriving the assessee of an effective opportunity to be heard, and whether the addition of Rs. 21,50,021/- as unexplained money under Section 69A was erroneously confirmed. Assessee's Contentions: - The assessment order was passed in breach of natural justice as it was issued before the scheduled hearing date (10.03.2025), with the AO having issued the order on 08.03.2025. - Replies and relevant material, including proof of donation, were furnished during the set-aside proceedings. - The matter should be restored to the AO for proper examination on merits as per the Tribunal's earlier directions. - The order passed by the AO lacked a DIN number, rendering it void. Revenue's Contentions: - The judgment records no specific contentions for the revenue, other than their representation by a Senior DR.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 254,Section 144,Section 147,Section 142(1),Section 69A,Section 148,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: SHRI RAHUL CHAUDHARY, JUDICIALMEMBER &SHRI GANGADHAR PANDA

For Appellant: Shri Prakash D Shah & Shri Saiyam Shah, ARs
For Respondent: Ms. Madhulika Satpute, Sr. DR
Hearing: 05.08.2026Pronounced: 08.10.2026

PER GANGADHAR PANDA - ACCOUNTANTMEMBER:

The captioned appeal has been filed by the assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (hereinafter referred to as “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi dated 09.02.2026 under Section 250 of the Income Tax Act, 1961 arising out of the Assessment Order, dated 08.03.2025 completed under Section 143(3) r.w.s. 254 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] for the Assessment Year 2010-11. 2. The assessee has raised the following grounds of appeal:

“1. That the learned National Faceless Appeal Centr

The order continues below.

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