V SELVARAJ AND CO.,PUDUCHERRY vs. DCIT, CIRCLE-I, PUDUCHERRY

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ITA 4222/CHNY/2026Status: DisposedITAT Chennai05 November 2026AY 2018-194 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) passed an ex-parte order without considering the submissions/documents made by the assessee through the e-filing portal during the appellate proceedings. To meet the ends of justice, the Tribunal decided to provide one more opportunity to the assessee. Consequently, the order of the CIT(A) was set aside, and the matter was remitted back to the CIT(A) to adjudicate the matter afresh on merits after providing a reasonable opportunity to the assessee. The assessee was directed to be diligent and file written submissions and relevant documents. The Tribunal noted that the AO had passed an order considering departmental information and partial submissions, and the CIT(A) dismissed the appeal without considering the e-filing portal submissions.

What were the facts?

The assessee, V Selvaraj And Co., a partnership firm engaged in contractual work, did not file its return of income for Assessment Year 2018-19. The case was re-opened under Section 147 of the Income-tax Act, 1961. The assessee subsequently filed a return declaring a total income of Rs.54,29,742/-. The Assessing Officer (AO), after considering submissions, disallowed remuneration and interest paid to partners totaling Rs.48,30,373/-, disallowed expenses of Rs.28,72,228/-, and made an addition of Rs.53,63,000/- as unexplained credit under Section 68. The assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) dismissed the appeal ex-parte, confirming the AO's order, as the assessee did not respond to hearing notices.

What were the issues?

1. Whether the CIT(A) erred in dismissing the appeal ex-parte without considering the partial submissions filed by the assessee on the e-filing portal, thereby violating principles of natural justice? (Question of law and fact, turning on procedural fairness and Section 250 of the Income-tax Act, 1961). Assessee's Contention: The assessee argued that the CIT(A) erred in stating no details were furnished, as partial submissions were filed on 28.05.2026 via the e-filing portal, evidenced by a system-generated acknowledgment, and viewed by the department prior to the impugned order. The assessee prayed for the order to be set aside and the issues remitted to the AO. Revenue's Contention: The revenue argued that the assessee had sufficient opportunities and that the CIT(A)'s order was not erroneous, praying for its confirmation.

Which sections of the Income-tax Act were involved?

Section 147,Section 144B,Section 148,Section 68,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI S.S. VISWANETHRA RAVI & SHRI S. R. RAGHUNATHA

Hearing: 12.10.2026Pronounced: 05.11.2026

आदेश /O R D E R

PER S. R. RAGHUNATHA, AM :

The present appeal has been preferred by the assessee against the order dated 08.06.2026 passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as “the Ld. CIT(A)”], arising from the assessment order dated 15.02.2023 passed by the Assessing Officer, Assessment Unit, NFAC, Delhi [hereinafter referred to as “the AO”], u/s.147 r.w.s 144B of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the Assessment Year (A.Y) 2018-19.

:-2-: ITA. No.4222/Chny/2026 2. Brief facts of the case are that the assessee is a partnership firm, engaged in contractual work of laying telephone optical fiber cables and gas pipeline works and did not file its return of income for AY 2018-19. As per information available with the department, the assessee made various huge financial transactions for the year under consideration. The case was re-opened u/s.147 of the Act, accordingly, a notice u/s.148 of the Act was issued to the assessee. In response, the assessee filed its return of income for AY 2018-19 on 16.05.2022, declaring a total income of Rs.54,29,742/-. Subsequently, the AO issued statutory notices to the assessee and by calling for details. In response, the assessee has submitted written submission along with supporting documents for consideration. On perusal of the documentary evidence submitted by the assessee, the AO concluded the re-assessment and passed an order u/s.147 r.w.s 144B of the Act dated 15.02.2023, by disallowing the renumeration paid to partners to the tune of Rs.20,00,000/- and interest paid to partners amounting to Rs.28,30,373/- and expenses claimed to the tune of Rs.28,72,228/- and also made additions to the tune of Rs.53,63,000/- as unexplained credit u/s.68 of the Act and adding the same to the total income of the assessee.

3.

Aggrieved by the order of the AO, the assessee preferred an appeal before the ld.CIT(A) on 13.05.2025.

4.

At the outset, we observed that ld.CIT(A) has provided two opportunities for the assessee to appear for hearings as detailed in paragraph 3 of the ld.CIT(A) order to support the appeal of the assessee. However, the assessee chose to be silent and did not respond to any of the notices and hence the ld.CIT(A) dismissed the appeal and passed an ex-parte order dated 08.06.2026 by confirming the order of the AO. Aggrieved by the impugned order of the Ld.CIT(A), the assessee is in appeal before us.

:-3-: ITA. No.4222/Chny/2026 5. The ld.AR submitted that the ld.CIT(A) erred in holding no details were furnished by the assessee in response to the notice dated 20.05.2026 fixing the hearing on 29.05.2026, when in fact the assessee had filed partial submission/ documents through the e-filing portal on 28.05.2026, duly evidenced by a system-generated acknowledgment, and the said submission was also viewed by the Department on 29.05.2026, prior to passing of the impugned order on 08.06.2026. In view of the above, the ld.AR prayed that the Tribunal may be pleased to set aside the order of ld.CIT(A) and remit the issues to the file of AO. Further, ld.AR assured the bench that the ld.AR will represent on behalf of the assessee before the AO to complete the assessment proceedings effectively.

6.

Per contra, the ld.DR submitted that the assessee has already been given sufficient opportunity and there is no error in the order of the ld.CIT(A) and hence, prayed for confirming the order of the ld.CIT(A).

7.

We have heard the rival parties and perused the material available on record and gone through the orders of the lower authorities. We note that the AO has passed an order by considering the information available with the department and partly submission made by the assessee and on appeal the same has been dismissed by the ld.CIT(A), NFAC without considering the submissions/documents made by the assessee through e-filing portal during the second round of appellate proceedings.

8.

Therefore, in the present facts and circumstances of the case and to meet the ends of justice, we are deeming it fit to provide one more opportunity to the assessee as the order passed by the ld.CIT(A) without participation of the assessee in his proceedings and hence we set aside the order of the ld.CIT(A) and remit the matter back to the file to ld.CIT(A) to adjudicate the matter afresh on merits in accordance with law, after providing reasonable opportunity to the assessee. Needless to say, assessee to be diligent and file written submissions and relevant documents if advised so.

:-4-: ITA. No.4222/Chny/2026

9.

In the result, appeal filed by the assessee is allowed for statistical purposes.

Order pronounced in the open court on 05th November, 2026 at Chennai.

Sd/- Sd/- (एस एस 'व(वने) र'व) (एस. आर. रघुनाथा) (S.S. VISWANETHRA RAVI) (S. R. RAGHUNATHA) �या�यक सद+य/Judicial Member लेखासद+य/Accountant Member

चे�ई/Chennai, EJTADA Digitally signed by िदनांक/Dated, the 05th November, 2026 EJTADA DURGA DURGA Devadas NARESH Date: 2026.11.10 NARESH आदेश क� ��त�ल�प अ�े�षत/Copy to: 16:56:29 +05'30' 1. अपीलाथ�/Appellant 2. ��यथ�/Respondent 3.आयकर आयु<त/CIT– Chennai/Coimbatore/Madurai/Salem 4. 'वभागीय ��त�न�ध/DR 5. गाड� फाईल/GF

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