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Facts
The assessee, an individual, filed a return of income for AY 2016-17. The Revenue, based on information regarding accommodation entries provided through 'Jama Kharchi' companies, initiated reassessment proceedings under section 148 and subsequently under section 144 for non-compliance.
Held
The Tribunal found that the assessee failed to provide requisite information and evidence to the Assessing Officer and CIT(Appeals). To ensure the principle of natural justice, the Tribunal decided to provide one more opportunity by remitting the matter back to the CIT(Appeals).
Key Issues
Whether the assessee's appeal against the additions made for unexplained income should be dismissed due to non-compliance, or if another opportunity should be granted for the principles of natural justice.
Sections Cited
131, 148, 142(1), 144, 68, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Assessment Year: 2016-2017 Dipankar Dutta,…………………….………...……Appellant 115, Sita Nath Bose Bye Lane, Salkia, Howrah-711106, W.B. [PAN:ACYPD1204F] -Vs.- Income Tax Officer,…………………………..…..Respondent Ward-54(1), Kolkata, Bamboo Villa, Central Revenue Building, 169, A.J.C. Bose Road, Kolkata-700014 Appearances by: Shri J.M. Thard, Advocate, appeared on behalf of the assessee Shri Abhijit Adhikari, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: December 11, 2025 Date of pronouncing the order: December 31, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of Id. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 25.08.2025 passed for Assessment Year 2016-2017.
The facts in brief are that the assessee is an individual, who filed his return of income for the assessment year 2016-17 (A.Y. 2016-2017) Dipankar Dutta disclosing total income of Rs.2,64,390/-. As per information available with the Department, a summon was issued under section 131 of the Act to Shri Balkrtishna Sikaria, Director of M/s. Sikaria Share & Stock Broking Services Pvt. Ltd. to investigate the nature of business activity of M/s. Sikaria Share & Stock Broking Services Pvt. Ltd. In response to the summons, Shri Sikaria stated in his statement dated 08.05.2014 that the main source of income was from commission for providing accommodation entries through ‘Jama Kharchi’ Companies. He also stated that a portion of his income was also from share trading. On perusal of share trading transactions, it was found by the Authority passing on the information that the company dealt in different shares, which had already been identified by the Department as penny stocks, through which entries of long -term capital gains/short term capital losses were provided to different beneficiaries. The assessee is one of such beneficiaries, who got accommodation entries of Rs.11,43,673/- while dealing in scrips like Sesagoa, ABAN Offshore, Midfield etc. during FY 2015-16, as per the ledger maintained at the office of M/s. Sikaria Share & Stock Broking Services Pvt. Ltd. A notice was issued under section 148 of the Act dated 26.03.2021 after obtaining approval from the competent authority to assess the above transaction. The assessee did not make compliance. Thereafter notices under section 142(1) on different dates were issued to the assessee along with questionnaire but the assessee did not make compliance with the notices issued. Thereafter assessment proceeding under section 144 of the Income Tax was initiated. A show cause notice was issued dated 12.03.2022 to the assessee fixing the date for (A.Y. 2016-2017) Dipankar Dutta compliance on 18.03.2022 to substantiate his accommodation entries of Rs.11,43,673/- along with draft assessment order stating as to why making addition/disallowances amount should not be passed. The assessee was required to furnish the details of amount received with documents and evidences as per notice issued with questionnaire dated 14.01.2022 requesting to furnish the documents, like bank account statement, details note of nature of business activities carried out during the year, details of long-term capital gain along with bank account statement, Contract Note on purchase and copy of account with copy of shares certificates as well as details of D-mat Account, Contract Note on sale of shares and confirmation of account in the books of brokers and documents for commission payment of Rs.1144/-. Getting no reply from the side of assessee, the ld. Assessing Officer treated the amount of Rs.11,43,673.75 and payment commission of Rs.1144/- as unexplained income from undisclosed sources of the assessee and added to the total income of the assessee under section 68 of the Income Tax Act, which comes to Rs.14,09,207/-.
On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals).
Ld. CIT(Appeals) dismissed the appeal of the assessee by saying that “in absence of any credible rebuttal or documentary evidence from the assessee, all the grounds raised in the appeal are dismissed and the additions made by the ld. Assessing Officer amounting to Rs.11,44,817/- are hereby confirmed”. .
(A.Y. 2016-2017) Dipankar Dutta
On being aggrieved, the assessee preferred an appeal before the Tribunal. At the time of hearing, the ld. Counsel for the assessee pleaded before the Bench that the assessee uploaded various details and documents to the ld. Assessing Officer to substantiate his claim, such as (i) letter dated 04.12.2019, (ii) Bank pass book of Bank of India, (iii) Acknowledgment of ITR-I, (iv) ledger copy of appellant in books of share broker- Sikaria Share & Stock Broking Services P. Ltd., (v) Details of shares giving details of opening balance, purchase, sale, profit & Loss and closing balance for FY 2015-16, (vi) date-wise/party-wise trade register, Demat account with Allahabad Bank from 01.04.2011 to 31.03.2019. But the ld. Assessing Officer as well as ld. CIT(Appeals) dismissed the appeal of the assessee ex-parte without considering the merits of the case. The ld. Counsel pleaded to set aside the order passed by the revenue authorities.
On the other hand, ld. Departmental Representative pleaded that sufficient opportunity was being provided to the assessee to substantiate his claim. Despite being given multiple opportunities via notices issued under section 142(1) during assessment proceedings and under section 250 of the Act during the appellate proceedings, the assessee failed to provide verifiable and independent documentary evidence to substantiate the genuineness of these transactions. Such conduct clearly demonstrates non-cooperation and indifference towards appellate proceedings before the ld. CIT(Appeals). Therefore, the ld. CIT(Appeals) has no other option except dismissing the appeal of (A.Y. 2016-2017) Dipankar Dutta the assessee ex-parte and he pleaded to uphold the order passed by the revenue authorities.
I have heard both the sides and perused the material available on record. I find that the assessee failed to produce the details of requisite information as asked before the ld. Assessing Officer as well as ld. CIT(Appeals). The assessee did not furnish any evidence in support of his claim. The ld. CIT(Appeals) dismissed the appeal of the assessee ex-parte without going into the merit of the case. Therefore, in order to ensure the principle of natural justice, I am of the view that it is a fit case to provide one more opportunity to the assessee. Therefore, I remit the matter back to the file of ld. CIT(Appeals) with a direction to dispose of the appeal without any inference on the observations of earlier order passed by him. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the ld. CIT(Appeals) failing which the ld. CIT(Appeals) shall be at liberty to pass appropriate order in accordance with law and merits of the case, based on the materials available on the record. Thus, the grounds raised
by the assessee in the appeal are partly allowed for statistical purposes.
8. In the result, the appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the open Court on 31/12/2025.