KANAN SANATAN SATYAPRIY,MUMBAI vs. INCOME TAX OFFICER, WARD 24(2)(1), MUMBAI

In the assessment addition was made under section 56(2)(x) of the Act related to difference in stamp duty value and purchase value of the property shown by the assessee amount to Rs.1,16,21,700/- which was added back under the head, “Income from other sources” to the total income. Further, the addition of Rws.83,00,800/- was confirmed and was added under section 69B of the Act. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld.CIT(A) allowed the assessee a reasonable opportunity of hearing, but none was presented before the Ld.CIT(A) during the appeal proceedings. The Ld.CIT(A), therefore, decided the appeal exparte upholding the additions made by the Ld. AO. The aggrieved assessee filed an appeal before us.

The Ld. AR submitted that the assessee had completely relied upon her Chartered Accountant, Mr. Kushwat Ojha, whose email ID was registered on the Income Tax Portal. However, Mr. Ojha subsequently relocated to Malaysia and introduced Mr. Nikash Mehta, another Chartered Accountant, to handle the assessee’s income tax matters. Mr. Mehta had assured the assessee that he would pursue the appeal before the Ld. CIT(A), but he failed to do so. Furthermore, the 3 ITA 2478/Mum/2025 Kanan Sanatan Satyapriy assessee was under considerable mental distress due to the demise of a close relative, which hindered her ability to focus on the appellate proceedings before the Ld. CIT(A). The assessee has detailed these facts in a sworn affidavit dated 06/06/2025.

The Ld. DR argued but did not raise any substantive objection to the explanation provided by the Ld. AR.

Upon careful consideration, we find that the assessee had reasonable cause for her non-appearance before the Ld. CIT(A). The assessee had bona fide relied on her Chartered Accountant, who neither properly participated in the appellate proceedings nor informed the assessee about the status thereof. Additionally, the assessee was undergoing emotional distress due to the loss of a close relative. The appellate order has been passed ex parte without affording the assessee a reasonable opportunity of being heard, thereby resulting in a denial of the principles of natural justice. In view of the above, we find it appropriate, in the interest of justice, to remand the matter to the file of the Ld. CIT(A) for adjudication afresh. We make no comment on the merits of the case, so as not to prejudice the outcome of the de novo proceedings. It is, however, directed that the assessee be granted a reasonable opportunity of being heard, and be permitted to file any additional documents in support of her case, in accordance with law. At the same time, the assessee is expected to act diligently and cooperate with the appellate proceedings to ensure expeditious disposal of the appeal.