PRADEEP KUMAR PROP. OF M/S P.K. OIL AGENCIES,RAEBARELI vs. CIT(A), NFAC, RAEBARELI

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ITA 659/LKW/2024Status: DisposedITAT Lucknow15 October 2026AY 2017-185 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the Assessing Authority had not given sufficient opportunity to the assessee, and the CIT(A) also failed to address the grounds raised by the assessee. Considering the totality of facts and material, to uphold the principle of natural justice and fairness, the Tribunal deemed it necessary to set aside the impugned order and restore the assessment to the file of the Assessing Officer. The AO is directed to consider the submissions and evidence furnished by the assessee and verify their veracity. The assessee is directed not to seek adjournments without reasonable cause. The grounds raised in the appeal are allowed for statistical purposes. The ratio decidendi is that where principles of natural justice are violated due to lack of adequate opportunity and non-consideration of grounds by lower authorities, the matter should be remanded for a fresh adjudication.

What were the facts?

The assessee, Late Pradeep Kumar, through his legal heir, filed an appeal against the order of the Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, for Assessment Year 2017-18. The assessee had initially declared a total income of Rs. 2,97,630/-. The case was re-opened under Section 147, and a notice under Section 148 was issued. The Assessing Officer (AO) proceeded ex parte under Section 144, making an addition of Rs. 2,77,29,000/- under Section 69A, resulting in a total income of Rs. 2,80,26,630/-. The assessee's appeal before the CIT(A) was dismissed on grounds of delay. The assessee is now before the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the Learned CIT(A) failed to appreciate the full facts and circumstances of the case while completing the assessment on Rs. 2,77,29,000/- against the returned income of Rs. 2,97,630/- (mixed law and fact, concerning the assessment proceedings). 2. Whether the Learned officer and the Learned CIT(A) erred in not providing a reasonable and proper opportunity to the assessee before completing the order (mixed law and fact, concerning natural justice). 3. Whether the Learned officer and the Learned CIT(A) erred in making an addition of Rs. 2,77,29,000/- by invoking the provision of Section 69A of the Income-tax Act, 1961 (mixed law and fact, concerning the validity of the addition). Assessee's Contentions: - The authorities below did not appreciate the facts in the right perspective. - The assessee was not granted a reasonable and effective opportunity at the assessment or appellate stage. - The assessment framed under Section 147 is without basis and proper appreciation of facts. - The addition of Rs. 2,77,29,000/- under Section 69A is not supported by cogent material and was based on presumptions and assumptions. - The orders are arbitrary, capricious, misconceived, erroneous, and against the principles of natural justice. Revenue's Contentions: - The Assessing Officer made the addition based on material available on record. - The assessee failed to satisfactorily explain the nature and source of the amount of Rs. 2,77,29,000/-.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 142(1),Section 144,Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, LUCKNOW BENCH “A”, LUCKNOW

Before: SHRI KUL BHARAT & SHRI NIKHIL CHOUDHARY

आयकर अपीलीय अधिकरण ‘ए’ न्यायपीठ, लखनऊ। IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW श्री कुल भारत, उपाध्यक्ष एवं श्री ननखखल चौिरी, लेखा सदस्य के समछ BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI NIKHIL CHOUDHARY, ACCOUNTANT MEMBER आयकर अपील सं/ ITA No.659/LKW/2024 ननिाारण वर्ा/ Assessment Year: 2017-18 Late Pradeep Kumar through v. The Income Tax Officer, L/h Avinash Rastogi, Prop. Of Ward-1 M/s. P. K. Oil Agencies Income Tax Office, Malikmau Road, Sultanpur Raebareli-229001. Road, Raebareli-229001. PAN:DHFPK2744L अपीलार्थी/(Appellant) प्रत्यर्थी/(Respondent) अपीलार्थी कक और से/Appellant by: Shri Rakesh Garg, Advocate प्रत्यर्थी कक और से /Respondent by: Shri Sudhakar Shukla, Sr. CIT(DR) सुनवाई कक तारीख / Date of hearing: 03 09 2026 घोर्णा कक तारीख/ Date of 15 10 2026 pronouncement: O R D E R PER KUL BHARAT, VICE PRESIDENT.: This appeal, filed by the legal heir of the deceased assessee, is directed against the order of the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi dated 04.09.2024 pertaining to the assessment year 2017-18. The assessee has raised the following grounds of appeal: - “1. Because the Learned "CIT (Appeal)" failed to appreciate the full facts and the circumstances of the case while completing the assessment on Rs. 2,77,29,000/- against the returned income of Rs. 2,97,630/-. 2. Because the Learned officer and the 'Learned CIT (Appeals) National Faceless Appeal Center' erred is not providing reasonable and proper opportunity before completing the order.

ITA No.659/LKW/2024 Page 2 of 5 3. Because the Learned officer and the 'Learned CIT (Appeals) National Faceless Appeal Center' erred both on facts and in law in making an addition of Rs. 2,77,29,000/- on account of addition by invoking the provision of under section 69A of the Income-tax Act 1961. 4. Because the Learned officer and the 'Learned CIT (Appeals) National Faceless Appeal Center' erred both on facts and in law in passing order against the settled judicial matter as pronounced by Hon'ble ITAT before shri Sandeep Singh Karhail, judicia member and Shri Gagan Goyal, accountant member ITA no.1102/Mum./2022 (Assessment Year: 2017-18) 5. Because the Learned officer and the 'Learned CIT (Appeals) National Faceless Appeal Center, is without any merits and in simple based on mere hypothesis, conjuncture & surmises and needs to be cancelled and the income as returned by the appellant be accepted. 6. Because no proper reasons has been forwarded both by the assessing officer and by the Ld. CIT (Appeal) National Faceless Appeal Center. In making and confirming and has relied on wrong facts and based on presumption. 7. Because order of the Learned CIT (Appel) National Faceless Appeal Center is arbitrary, capricious, misconceived, erroneous and against the principal of natural justice. 8. Because the above grounds of appeal will be argued in detail at the time of hearing and the assessee craves leave to submit addition ground of appeal if any and/or amend, vary, modify, alter the grounds of appeal at or before the time of hearing.” 2. The facts in brief are that in this case, the assessee filed his return of income for the A.Y. 2017-18 on 16.10.2017, declaring total income at Rs.2,97,630/-. Thereafter, the case was re-opened u/s 147 of the Income Tax Act, 1961 (“Act”, for short) and a notice u/s 148 of the Act dated 31.03.2021 was issued. As per AO in response to the notice u/s 148 of the Act, the assessee filed his ITR on 24.12.2021. However, another notice was issued u/s 142(1) of the Act dated 04.01.2022 calling upon the assessee to file his ITR duly e-verified. The assessee failed to respond to the statutory notice and submit duly e-verified ITR. Hence, the AO proceeded to pass ex parte order u/s 144 of the Act. Thereby, he made an addition of Rs.2,77,29,000/- u/s 69A of the Act and computed income at Rs.2,80,26,630/-. Aggrieved, the assessee carried the matter in appeal before the Ld. CIT(A), who dismissed

ITA No.659/LKW/2024 Page 3 of 5 the appeal on the ground of delay. Hence, the assessee is in appeal before this Tribunal.

3.

At the outset, the Ld. Counsel for the assessee has taken multiples grounds including the grounds that adequate opportunity of being heard to the assessee was not provided by the Ld. CIT(A). Apropos to the grounds of appeal, Ld. Counsel for the assessee contended that the authorities below did not appreciate the facts in right perspective. Further, he contended that the assessee was not granted a reasonable and effective opportunity either during the assessment proceedings or at the appellate stage. Further, he contended that the assessment framed under section 147 of the Act is without any basis and without proper appreciation of the entire facts on record. The Ld. Counsel further submitted that the addition of Rs.2,77,29,000/- u/s 69A of the Act is not supported by any cogent material establishing that the said amount represented unexplained money belonging to the assessee. It was argued that the authorities below proceeded primarily on presumptions and assumptions without properly examining the explanation and documentary evidence furnished by the assessee.

4.

On the other hand, the Ld. Departmental Representative (DR) opposed the submission and supported the orders of the lower authorities and contended that the Assessing Officer had made the addition on the basis of material available on record and that the assessee had failed to satisfactorily explain the nature and source of the amount of Rs.2,77,29,000/-.

5.

We have heard the Ld. Representatives of the parties. The short controversy before us is whether, on the facts and circumstances of the present case, the Assessing Officer was

ITA No.659/LKW/2024 Page 4 of 5 justified in making an addition of Rs.2,77,29,000/- u/s 69A of the Act and whether the First Appellate Authority was justified in sustaining the same. It is an admitted position that the assessee had declared total income of Rs.2,97,630/- whereas the assessment was completed after making an addition of Rs.2,77,29,000/- u/s 69A of the Act. We find that the Assessing Authority had not given sufficient opportunity to the assessee and the Ld. CIT(A) as well failed to advert to the grounds taken by the assessee. Therefore, considering the totality of the facts and the material placed before us, to sub-serve the principle of natural justice and to be fair with both the parties, deem it necessary and expedient under the facts of the present case to set aside the impugned order and restore the assessment to the file of the Assessing Officer. The AO is hereby directed to consider submissions and evidences; as furnished by the assessee in support of its claim and verify the veracity of such claim. The assessee is directed not to seek adjournment without any reasonable cause. The grounds raised in the appeal are allowed for statistical purposes. 6. In the result, the appeal of the assessee in ITA. No.659/LKW/2024 is allowed for statistical purposes. Order pronounced in the open Court on 15/10/2026.

Sd/- Sd/- [ननखखल चौिरी] [कुल भारत] [NIKHIL CHOUDHARY] [KUL BHARAT] लेखा सदस्य/ACCOUNTANT MEMBER उपाध्यक्ष/VICE PRESIDENT DATED: 15/10/2026 Vijay Pal Singh, (Sr. PS)

ITA No.659/LKW/2024 Page 5 of 5 Copy forwarded to: 1. Appellant 2. Respondent Digitally signed VIJAY PAL 3. CIT by VIJAY PAL SINGH 4. DR SINGH Date: 2026.10.15 5. Guard File 15:48:49 +05'30' By Order Sr. Private Secretary //True Copy//

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