Loading judgment…
Facts
The assessee, a Private Limited Company, failed to file its return of income for AY 2020-21. The Assessing Officer (AO) reopened the case and made additions based on bank deposits and sales disclosed in GST returns, treating it as undisclosed business income. The assessee did not appear before the CIT(A), leading to an ex parte order.
Held
The Tribunal held that the CIT(A) passing an ex parte order solely on the grounds of non-compliance, which upheld the AO's order, was not justified. In the interest of substantial justice, the assessee was granted another opportunity to present its case.
Key Issues
Whether an ex parte order by the CIT(A) upholding the AO's order based on the assessee's non-compliance is justified, and whether the assessee should be granted a fresh opportunity to present its case.
Sections Cited
250, 147, 148, 142(1), 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘B’ BENCH KOLKATA
Before: Shri Sonjoy Sarma & Shri Rakesh Mishra
Assessment Year: 2020-21 Islander Housing Project Pvt. Ltd.……………....…………………....Appellant 1, Teylarabad, Port Blair, South Andaman, A & N Islands – 744103.. [PAN: AAECI4668P] vs. ITO, Ward-3(4), Port Blair..……………....…..………………….…..... Respondent Appearances by: Shri Akkal Dudhwewala, FCA, appeared on behalf of the appellant. Shri Kapil Mondal, Sr. DR, appeared on behalf of the Respondent. Date of concluding the hearing : December 02, 2025 Date of pronouncing the order : December 29, 2025 आदेश / ORDER
Per Sonjoy Sarma, Judicial Member:
This appeal filed by the assessee is directed against the order of the NFAC, Delhi (hereinafter referred to as “ld. CIT(A)”) dated 31.07.2025 passed under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”).
Brief facts of the case are that the assessee is a Private Limited Company and has not filed return of income for the A.Y. 2020-21. The Assessing Officer found that the assessee deposited cash in the current bank account maintained with SBI amounting to Rs.5,91,000/- and withdrawal of Rs.2,56,00,000/- and further, cash deposited in IDBI bank current account of Rs.1,21,73,550/- and withdrawal of Rs.70,37,470/-., total sales to the tune of Rs.4,95,63,577/- in GST return and cash withdrawal in SBI current account amounting to I Islander Housing Project Pvt. Ltd Rs.1,55,80,500/- as per TDS statement. Accordingly, case was reopened u/s 147 and notice u/s 148 of the Act was issued on 28/02/2024. Further, the notices u/s 142(1) of the Act and show cause notice were duly issued and the assessee remained non-compliant during the assessment proceedings. Subsequently, the Assessing Officer completed the assessment u/s 147 r.w.s 144B of the Act by making addition of Rs.49,56,358/- (10% of Rs.4,95,63,577/- turnover) in respect of undisclosed business income.
Aggrieved by the above order, the assessee preferred an appeal before the Ld. CIT(A). However, the assessee did not appear or comply on the dates fixed for hearing. Consequently, the CIT(A) dismissed the appeal of the assessee by passing an ex parte order upholding order of the Assessing Officer.
Dissatisfied with the above order, the assessee is in appeal before this tribunal. The learned AR submitted that the appeal was dismissed without proper hearing and that the assessee may be given a final opportunity to substantiate its claims before the authority below. It is submitted that the ex parte order of the Ld. CIT(A) passed on technical ground of non-compliance caused prejudice to the assessee and resulted in miscarriage of justice.
On the other hand, the learned Departmental Representative supported the order of the authorities below and did not object to the matter being remanded for a fresh hearing.
We have heard both sides and perused the material on record. We find that in the present case, the CIT(A) passed an ex parte order due to non-compliance of the assessee simply upholding the order of the Assessing Officer, which is not justified in the eyes of law. Therefore, in I Islander Housing Project Pvt. Ltd the interest of substantial justice and fair play, we feel it necessary to provide the assessee with one more opportunity to explain and substantiate its case before the ld. CIT(A). Accordingly, we restore the matter to the file of the ld. CIT(A) for fresh adjudication in accordance with law, after affording the assessee a reasonable opportunity of being heard and to submit necessary supporting documents. The assessee is also directed to cooperate in the proceedings without fail.