VIKAS CHANDRAKANTBHAI SHAH,AHMEDABAD vs. THE ITO, WARD-5(3)(1), AHMEDABAD

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/-in as much as the assumption of juri iction is not valid. The notice u/s 148 ought to have been issued by the Faceless Assessing Officer and not the Juri ictional Assessing Officer. Asst. Year –2019-20 - 2–

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. l,06,33,890/-in as much as the approval u/s 151 is invalid in so far as the Approval is without application of mind.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. l,06,33,890/-in as much as the approval u/s 151 is invalid in so far as the Approval does not contain any digital signature.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. l,06,33,890/-in as much as the assumption of juri iction is not valid as the Notice u/s 148A(b) is not only vague but also for making fishing inquiry which is not permissible and the same is issued without supplying any information in possession of Ld. AO.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/- by upholding the addition of Rs 99,80,000/- by modifying the section from 69C to Section 68. 8. The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/- by upholding the addition of Rs 99,80,000/- ignoring the fact that the same have been returned by the Appellant.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/- by upholding the addition of Rs 99,80,000/ - by violating the principle of Natural Justice.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/- by upholding the addition of Rs 99,80,000/-as accommodation entry precisely based on conjectures and surmises without bringing any evidence on record.

The Ld. CIT(A) has erred in law and in facts in confirming the Assessment Order passed u/s 147 rws 144B of the Income Tax Act, 1961 assessing total income at Rs. 1,06,33,890/- by upholding the addition of Rs 99,80,000/- without providing the opportunity of video conference despite categorically demanded in the written submission filed by the Appellant. Asst. Year –2019-20 - 3–

The appellant craves leave to add, alter or amend the ground of appeal before or at the time of hearing of the appeal.”

The brief facts of the case are that the assessee is an individual who filed his return of income for the Assessment Year 2019–20 declaring total income of ₹6,53,890/-. Subsequently, based on information received from the Investigation Wing of the Department that the assessee had entered into transactions with concerns managed by Shri Sanjay Tibrewal, on whom a search was conducted on 12.04.2019, the case of the assessee was reopened under section 147 of the Income-tax Act ("the Act"). The allegation of the Department was that Shri Sanjay Tibrewal was operating a network of shell entities which were engaged in providing accommodation entries to various beneficiaries. On the basis of such information, proceedings under section 148A of the Act were initiated on the assessee. In response to the notice issued by the Assessing Officer, the assessee filed a return of income on 24.04.2023. 4. During the course of reassessment proceedings, the Assessing Officer observed that the assessee had allegedly entered into transactions amounting to ₹99,80,000/- with concerns associated with Shri Sanjay Tibrewal. The Assessing Officer asked the assessee to furnish details and furnish explanation regarding the said transactions. According to the Assessing Officer, the assessee did not furnish satisfactory explanation nor did the assessee file documentary evidence regarding the nature of these transactions. Therefore, the Assessing Officer treated the said amount of ₹99,80,000/- as unexplained expenditure under section 69C of the Act and added the same to the total income of the assessee. The Assessing Officer completed the Vikas Chandrakantbhai Shah vs. ITO Asst. Year –2019-20 - 4–

Aggrieved by the reassessment order, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC). The CIT(A) first noted that the appeal had been filed with a delay of almost one year and that the assessee had neither mentioned the delay in Form No.35 nor furnished any explanation seeking condonation of delay. According to the CIT(A), the appeal was liable to be dismissed on this ground alone. However, the CIT(A) proceeded to examine the issues raised in the appeal on merits as well. In Ground Nos.1 and 2, the assessee challenged the validity of reopening of assessment and contended that the notice under section 148A(b) and order under section 148A(d) were issued without proper application of mind and that the notice under section 148 of the Act had been issued by the Juri ictional Assessing Officer instead of the Faceless Assessing Officer. The CIT(A) rejected these contentions and held that the issue relating to issuance of notice by the Juri ictional Assessing Officer had been decided in favour of the Revenue in the decision of TKS Builders Pvt. Ltd. v. ITO (2024) 167 taxmann.com 759 (Delhi). The CIT(A) further observed that sufficient opportunity had been provided to the assessee during the proceedings under section 148A but the assessee had failed to furnish any explanation regarding the accommodation entries. The CIT(Appeals). relying upon the judgment of the Hon’ble Allahabad High Court in Rochana Asst. Year –2019-20 - 5–

The assessee is in appeal before us against the order passed by the CIT(Appeals) dismissing the appeal of the assessee.

We have heard the rival submissions and perused the material available on record. The primary contention raised by the learned counsel for the assessee before us is that the order passed by the learned CIT(A) suffers from violation of principles of natural justice. It was submitted that from page 116 of the Paper Book it is evident that the learned CIT(A) issued only one notice of hearing dated 20th June 2025 and thereafter proceeded to pass the appellate order without granting further opportunity of hearing to the assessee. It was further submitted that the assessee had filed written submissions dated 06.07.2025 before the CIT(A) wherein a specific request was made for personal hearing through video conference. However, this request was not acceded to by the CIT(A) and the appeal was decided without granting the assessee an effective opportunity of being heard.

We find merit in the submissions advanced by the learned counsel for the assessee. The right of an assessee to be heard before an adverse order is passed is a fundamental requirement of the principles of natural justice. Section 250 of the Income-tax Act also contemplates that the Commissioner (Appeals) shall give the appellant an opportunity of being heard before disposing of the appeal. Where such opportunity is not granted in an effective manner, the appellate order cannot be sustained in law.

In the present case, the material placed before us shows that the CIT(A) issued only one notice of hearing (which has not been controverted by Ld. Asst. Year –2019-20 - 7–

Considering the totality of the facts and circumstances of the case and in the interest of justice, we deem it appropriate to set aside the impugned order of the CIT(A) and restore the matter to the file of the CIT(A) for fresh adjudication. The CIT(A) shall grant adequate opportunity of hearing to the assessee including the opportunity of personal hearing through video conference, if so requested by the assessee, and thereafter pass a reasoned order in accordance with law.

Accordingly, the appeal of the assessee is allowed for statistical purposes and the matter is restored to the file of the CIT(A) for de-novo consideration. This Order is pronounced in the Open Court on 12/03/2026 (NARENDRA P. SINHA) JUDICIAL MEMBER Ahmedabad; Dated 12/03/2026