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Facts
The assessee's appeal against an NFAC order, arising from an ex-parte assessment under Section 147 read with Section 144, was delayed by 170 days. The Tribunal condoned the delay as the assessee, an uneducated senior citizen, lacked knowledge of tax matters. The assessment made a high-pitched addition of Rs. 5,31,83,333 for Long Term Capital Gain and Rs. 19,395 for interest, despite the assessee claiming to have received only Rs. 35,00,000 for the transaction.
Held
The Tribunal observed that both the assessment and impugned orders were ex-parte, passed without granting a reasonable opportunity of hearing to the assessee. Considering the substantial additions made on amounts not received by the assessee, the Tribunal remitted the matter back to the Jurisdictional Assessing Officer for de novo adjudication after providing a proper opportunity of hearing. The finding of the CIT(A) was set aside, and the appeal was allowed for statistical purposes.
Key Issues
Whether the ex-parte assessment orders, including the reopening under Section 147 and substantial additions for LTCG and interest, are valid when passed without adequate opportunity of hearing and proper service of notices to the assessee.
Sections Cited
147, 144, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, B BENCH, PUNE
Before: Dr. MANISH BORAD & SHRI VINAY BHAMORE
Assessee by : Shri Ramesh Jain Revenue by : Shri Ganesh B. Budruk-Additional CIT Date of hearing : 28.04.2025 Date of pronouncement : 06.05.2025 आदेश/ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
This appeal at the assessee is directed against the order of NFAC, Delhi dated 28.05.2024 framed u/s 250 of the Income Tax Act and is arising out of order u/s 147 r.w.s 144 of the Act dated 25.03.2023.
Registry has informed that the instant appeal is barred by limitation of 170 days. Assessee has filed an application for condonation of delay alongwith an affidavit. Ld. DR opposed the request of assessee for condonation of delay. We however on observing that the delay was on account of lack of knowledge about the tax matters, delay was un-intentional, natural and notice that the assessee is not educated and is a Senior Citizen. Therefore considering the reasonable cause and in the larger interest of justice we condone the delay of 170 days and admit the appeal for adjudication.
Assessee has raised following grounds of appeal:-
1. On the facts and in the circumstances of the case and in law, the learned CTT (A) erred in confirming the action of re-opening of the assessment proceeding U/s 147 of the income Tax Act 1961.
2. On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in confirming the Order passed by the learned Assessing officer which, is illegal, bad in law, ultra virus and contrary to the provisions of the law and facts, since the order of the learned DCIT is passed without giving proper opportunity to the assesse of hearing and explaining the case.
3. On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in confirming the Order passed by the learned DCIT. The same is bad in law as proper service of the notices was not made to the assessee, the same is in violation of the principles of natural justice on various issues as stated herein.
4. On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in confirming the additions of Rs. 5,31,83,333/- on account ofLong Term Capital Gain (LTCG) without considering the facts the appellant has merely received a negligible amount out of the said consideration. Thus, the learned CIT (A) failed to appreciate the facts and circumstances of the case.
5. On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in confirming the additions of Rs. 19,395/-on account Interest and considering the same as Income From Other Sources. Thus, the learned CIT (A) failed to appreciate the facts and circumstances of the case.
6. On the facts and in the circumstances of the case and in law, the Order passed by the learned CIT (A) is illegal, bad in law, ultra virus and contrary to the provisions of the law and facts, and the same is passed without application of mind and in violation of the principles of natural justice on various issues as stated hereinabove. The order so confirmed by the learned CIT (A) is without any basis and based on assumption, surmises, whims and suspicion.
7. On the facts and in the circumstances of the case and in lawthe Hon'ble members are requested to condone the delay in filing the appeal before the Hon'ble ITAT.
8. The Appellant craves leave to add, to alter or to amend any of the ground of appeal mentioned hereinabove.
9. Each one of the above grounds of appeal is independent and without prejudice to each other.
4. At the outset Ld. counsel for the assessee submitted that both assessment orders as well as impugned orders are framed ex-parte and there was no communication with the assessee about the dates of hearing fixed by both the authorities. He further submitted that a high pitched assessment has been made making the addition of Rs. 5,31,83,333/- whereas the amount received by the assessee for alleged transaction was only in the capacity of the affirming party and that the assessee received only Rs. 35,00,000/- He therefore referring to the Paper Book requested for setting aside the matter to the file of Learned Jurisdictional Assessing Officer (JAO). Ld. DR did not oppose to the request of Ld. counsel of the assessee.
We have heard rival contentions and perused the record placed before us. We observe that the impugned order as well as the assessment order are ex-parte, assessee is a senior citizen and is not educated. Notice of hearing were not received by the assessee. By referring to the relevant documents in the paper book, Ld. counsel for the assessee has contended that a high pitch assessment has been made and huge addition has been made for the amount not received by the assessee. We therefore in the larger interest of justice and being fair to both the parties remit the issue raised on merits to the file of Ld. JAO for denovo adjudication before whom the assessee shall furnish necessary details for which a reasonable opportunity of hearing shall be granted to the assessee. Finding of Ld. CIT(A) is set aside and effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 06th day of May, 2025.
Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; दििांक / Dated: 06th May, 2025. Neeta आिेश की प्रधिधलधप अग्रेधषि / Copy of the Order forwarded to:
1. 1. अपीलार्थी / The Appellant. 2. प्रत्यर्थी / The Respondent.