MOTI PVT. LTD.,CHENNAI vs. ITO, CORPORATE CIRCLE-4(1), CHENNAI

ITA 2243/CHNY/2025Status: DisposedITAT Chennai30 October 2025AY 2017-184 pages

AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal, while acknowledging the rival submissions and perusing the materials, found that the AO issued a show cause notice on 18.05.2023 with a compliance period of only four days. It also noted that the CIT(A) passed an ex-parte order due to the assessee's non-response and failure to furnish details. However, adhering to the principles of natural justice, the Tribunal was of the opinion that one more opportunity should be granted to the assessee. Consequently, the impugned orders were set aside, and the matters were remitted back to the file of the AO for denovo assessment. The AO was directed to afford a reasonable opportunity of being heard to the assessee, and the assessee was directed to comply with all notices and furnish relevant details. The appeals were allowed for statistical purposes.

What were the facts?

The assessee, Moti Private Ltd., is in appeal before the Income Tax Appellate Tribunal (ITAT) against the orders of the Commissioner of Income Tax (NFAC), Delhi, for Assessment Years (AYs) 2017-18 and 2018-19. For AY 2017-18, the assessee did not file its return of income. Based on information of rental receipts of Rs. 33,60,000/-, the Assessing Officer (AO) reopened the assessment and completed it under Section 144 of the Income Tax Act, 1961, making an addition of Rs. 23,39,680/- due to non-filing of return and failure to furnish details. The assessee's appeal before the CIT(A) was dismissed ex-parte for non-compliance. For AY 2018-19, the facts and issues are identical. The assessee sought an opportunity to present its case before the AO.

What were the issues?

1. Whether the assessee was provided with a sufficient opportunity to present its case before the Assessing Officer, considering the short notice period, under principles of natural justice, turning on Section 144 of the Income Tax Act, 1961. Assessee's Contention: The AO did not provide sufficient opportunity as the show cause notice dated 18.05.2023 required compliance by 23.05.2023, granting only four days. The assessee requested one more opportunity to present its case before the AO. Revenue's Contention: The Learned Departmental Representative relied on the orders of the lower authorities and requested that the appeal be dismissed.

Which sections of the Income-tax Act were involved?

Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI JAGADISH

Hearing: 23.10.2025Pronounced: 30.10.2025

आदेश / O R D E R

PER JAGADISH, A.M : Aforesaid two appeals filed by the assessee for Assessment Years (AYs) 2017-18 & 2018-19 arises out of the orders of Learned Commissioner of Income Tax (NFAC), Delhi [hereinafter “CIT(A)”] dated 03.07.2025 & 13.06.2025, respectively.

& 2244/Chny/2025 Moti Pvt. Ltd. :- 2 -:

The assessee is a company and had not filed its return of income for the relevant assessment year. Based on the information, the A.O found that the assessee has rental receipts of Rs. 33,60,000/-.

Since no return of income was filed, the A.O. reopened the assessment. The A.O. thereafter completed the assessment u/s. 144 of the Act by making an addition of Rs. 23,39,680/- in respect of rental income, as the assessee had failed to file the return of income as well as furnish the details called for. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). However, the Ld. CIT(A) dismissed the appeal ex-parte as the assessee failed to comply with the notices issued.

The Learned Authorized Representative (Ld. A.R.) contended that the A.O did not provide sufficient opportunity, as the show cause notice dated 18.05.2023 required compliance by 23.05.2023, thereby granting only four days time. It was therefore submitted that one more opportunity may be granted to the assessee to present its case before the A.O.

& 2244/Chny/2025 Moti Pvt. Ltd. :- 3 -:

The Learned Departmental Representative (Ld. D.R) relied on the orders of the lower authorities and requested that the appeal be dismissed.

We have heard the rival submissions and perused the materials available on record. We have heard the rival submissions and perused the materials available on record. We find that the A.O. issued a show cause notice on 18.05.2023 granting only four days’ time for compliance, and that the Ld. CIT(A) also passed the order ex parte as the assessee did not respond to the notices issued and failed to furnish the requisite details. However, keeping in view the principles of natural justice, we are of the opinion that one more opportunity should be granted to the assessee to substantiate her case before the A.O.

Accordingly, we set aside the impugned order and remit the matter back to the file of the A.O for denovo assessment in accordance with law, after affording reasonable opportunity of being heard to the assessee. The assessee is also directed to comply with all the notices issued by the A.O and furnish all relevant details for fresh consideration. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.

& 2244/Chny/2025 Moti Pvt. Ltd. :- 4 -:

: 7. The facts and issues involved in the assessee’s appeal for A.Y. 2018–19 are identical to those considered in A.Y. 2017–18. Following our decision in A.Y. 2017–18, we similarly set aside the impugned order for this year and remit the matter back to the file of the A.O for denovo assessment in accordance with law, after affording reasonable opportunity of being heard to the assessee.

In the result, both the appeals filed by the assessee are allowed for statistical purposes.

Order pronounced on 30th day of October, 2025 at Chennai.

Recent GST High Court judgments

Search GST case law →