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Facts
The assessee filed an appeal against an order of the CIT(A) that dismissed the appeal ex-parte. The reassessment was initiated based on information from an investigation wing search, alleging cash payment for agricultural land sale. The AO added Rs 91,86,000/- under Section 69A as unexplained money.
Held
The Tribunal held that the CIT(A) erred in passing an ex-parte order without considering the assessee's contentions. Principles of natural justice require an opportunity to be heard. The matter is restored to the CIT(A) for fresh adjudication.
Key Issues
Whether the CIT(A) order passed ex-parte without considering the assessee's grounds is sustainable? Whether principles of natural justice were violated by denying cross-examination?
Sections Cited
148, 147, 144, 69A, 115BBE
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Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD
Before: DR. BRR KUMAR & SHRI SIDDHARTHA NAUTIYAL
(Assessment Year: 2018-19) Vijaykumar Ukabhai Patel, Vs. Income Tax Officer, House No. 89, Sanskar Villa, Ward-1, Nr. Raghav Gas Agency, Vijapur, Mehsana Gujarat-382870 [PAN No.DPRPP8338P] (Appellant) .. (Respondent) Appellant by : Shri Sulabh Padshah, AR Respondent by: Shri Abhijit, Sr. DR 11.12.2025 Date of Hearing Date of Pronouncement 16.12.2025 O R D E R
PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated 10.07.2025 passed for A.Y. 2018-19.
The assessee has raised the following grounds of appeal:
“1. The Ld. Assessing Officer has erred in reopening the case of Appellant by wrongly invoking the provisions of Section 148 of the Act. It is submitted that after insertion of new provisions w.e.f. 1-4-2021, only the Faceless Assessing Officer (FAO) has jurisdiction to issue notices u/s 148 of the Act. It is therefore submitted that the whole proceeding-initiated u/s 148 assuming wrong jurisdiction by JAO is bad in law and consequential Assessment order passed u/s 147 rws 144 of the Act be quashed and set aside. The same be held accordingly.
2. The Ld. Assessing Officer has erred in law and on facts in reopening the case of the Appellant invoking provisions of Section 147 and 148 of the Act. On facts and circumstances of the case, there is not at all any escapment of income on part of Appellant. It is therefore submitted that the whole reopening of assessment is bad in law and void ab initio and the order passed u/s 147 rws 144 of the Act be quashed and set a side accordingly.
3. The Ld. Assessing Officer has erred in law and on facts in passing the order under Section 144 of the Act. It is submitted that the Appellant has duly responded during course of assessment proceeding and filed detailed submission and explanation. On facts and circumstances of the case, the Ld AO has wrongly invoked the provisions of Section 144 of the Act and thus the Asst. order passed is incorrect and invalid accordingly.
4. The Learned CIT (Appeals) has erred in passing an Ex-parte order and dismissing the appeal of the Appellant without appreciating the facts and circumstances of the case. It is submitted that the responses could not be filed before lower authorities due to circumstances beyond the control of the Appellant. In view of this, the lower authorities may please be directed to hear the appellant again and the additions made of Rs 91,86,000/- kindly be deleted after fresh verification of details and evidences.
5. The lower authorities have erred both on facts and in law in making and confirming addition of Rs 91,86,000/- u/s 69A of the Act assuming that the Appellant has received cash payment towards purchase of property. On facts and circumstances of the case, the provisions of Section 69A are just not attracted in case of Appellant. Hence, the addition made by Assessing Officer of Rs 91,86,000/- is unwarranted and the same be deleted.
6. The lower authorities have erred in holding that the Appellant has received Rs 91,86,000/- in cash towards sale of property during the year. It is submitted that there are no incriminating documents whatsoever of any nature found suggesting alleged cash receipt of Rs 91,86,000/- by Appellant. It is further submitted that the details / documents relied upon by AO found from the premises of the third party, are completely irrelevant, does not containing name or any reference relevant to the Appellant. Thus the entire addition made of Rs 91,86,000/- purely on assumption and without application of mind and be deleted in the interest of justice.
7. The Lower authorities has erred in making the addition relying upon statement of third persons. It is settled law that any addition made relying upon statement of third persons without providing opportunity of cross-examinations is not sustainable in eyes of law. It is therefore submitted that addition made of Rs 91,86,000/- blindly relied upon third party statement without providing cross-examination opportunity to the Appellant is incorrect and against the principle of natural justice and thus the same be deleted.
8. The Order passed by the learned CIT(A) and Ld. AO are bad in law and contrary to the provisions of law and facts. It is submitted that the same be held so now.
Vijaykumar Ukabhai Patel vs. ITO Asst.Year –2018-19 - 3– 9. Your appellant craves leave to add, alter and/or to amend all or any of the grounds before the final hearing of appeal.”
The brief facts of the case are that the assessee, an individual, filed his original return of income for A.Y. 2018-19 on 10.07.2018 declaring a total income of ₹98,940/- and claiming exempt income of ₹37,16,666/- on account of sale of agricultural land. Subsequently, based on information received from the Investigation Wing pursuant to a search action conducted in the case of VEE GEE Group, reassessment proceedings were initiated. The Assessing Officer initiated reassessment proceedings and during the reassessment proceedings, the Assessing Officer relied upon certain seized digital evidence in the form of excel sheets found from a third party, wherein it was alleged that land bearing Survey No. 446 was purchased by M/s Sheetkraft India Pvt. Ltd. and VGAC at a consideration higher than the registered value and that a part of the consideration was paid in cash. According to the Assessing Officer, the assessee had received cash of ₹91,86,000/- over and above the registered consideration of ₹1,11,50,000/- for sale of agricultural land. The assessee consistently denied having received any cash component and contended that the land sold was agricultural land situated beyond the prescribed limits and therefore not a capital asset. The assessee also requested for cross- examination of the persons whose statements and documents were relied upon. However, this request was declined by the Assessing Officer. The Assessing Officer was not convinced with the explanation of the assessee and held that the cash component of ₹91,86,000/- received by the assessee denoted unexplained money received by the assessee. Accordingly, the Vijaykumar Ukabhai Patel vs. ITO Asst.Year –2018-19 - 4– Assessing Officer added the said amount under section 69A of the Act as income of the assessee and taxed the same under section 115BBE.
Aggrieved by the assessment order, the assessee filed an appeal before the Ld. CIT(Appeals). The delay in filing the appeal was condoned. During the appellate proceedings, several notices were issued by the NFAC asking the assessee to file submissions. However, since no submissions were filed within the stipulated time by the assessee, the Ld. CIT(Appeals) proceeded to decide the appeal ex-parte. Relying on the assessment order and observing that the assessee had failed to substantiate the grounds raised, the Ld. CIT(Appeals) confirmed the addition of ₹91,86,000/- made under section 69A of the Act and dismissed the appeal.
The assessee is in appeal before us against the order passed by CIT(Appeals) dismissing the appeal of the assessee.
We have heard the rival contentions and perused the material on record. We note that the Ld. CIT(Appeals) has disposed of the appeal ex- parte solely on the ground that the assessee did not file submissions during the appellate proceedings. From the record, it is evident that the assessee has raised substantive legal as well as factual issues, including challenge to the reopening proceedings, applicability of section 69A of to the facts of the assessee’s case, the assessee had challenged the reliance by the Assessing Officer on third-party documents, and denial of opportunity of cross-examination. We are of the considered view that these issues go to
We are of the considered view that the principles of natural justice require that the assessee be afforded a reasonable opportunity of being heard, particularly when serious additions have been made and confirmed. Since the Ld. CIT(Appeals) has passed an ex-parte order without considering the contentions of the assessee, we deem it appropriate, in the interest of justice, to set aside the impugned order of the Ld. CIT(Appeals) and restore the matter to his file for fresh adjudication. The Ld. CIT(Appeals) shall provide adequate opportunity to the assessee to file submissions and evidences and thereafter decide the appeal in accordance with law.
Accordingly, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 16/12/2025