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

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ITA 1299/AHD/2024Status: DisposedITAT Ahmedabad07 November 2025AY 2017-18Bench: DR. B.R.R. KUMAR, VICE-PRESIDENT SHRI SIDDHARTHA NAUTIYAL (Judicial Member)1 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal acknowledged the assessee's non-compliance and ex-parte orders from the lower authorities. However, in the interest of substantial justice, the Tribunal decided to give the assessee one final opportunity.

What were the facts?

The assessee filed a return of income declaring Rs. 15,00,000/-. The case was selected for scrutiny, and during assessment proceedings, the assessee was asked to explain cash deposits of Rs. 4,19,06,500/-. The assessee claimed the deposits belonged to third parties and were transferred, but the Assessing Officer made an addition under Section 69A.

What were the issues?

Whether the addition of Rs. 4,19,06,500/- under Section 69A was justified, and whether the notice issued under Section 143(2) was valid.

Which sections of the Income-tax Act were involved?

Section 250,Section 143(1),Section 143(2),Section 69A,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

For Appellant: Shri Divyang Shah, AR
For Respondent: Shri Abhijit, Sr. DR
Hearing: 14.08.2025Pronounced: 07.11.2025

O R D E R

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:

1.

- Delay Condoned. This appeal has been filed by the Assessee against the order dated 22.08.2023 passed by the Ld. Commissioner of Income-Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“the CIT(A) in short), under Section 250 of the Income-tax Act, 1961 (“the Act”), relating to the Assessment Year 2017-18. 2. The sole substantive ground raised by the assessee reads as under: “Whether, on facts and in circumstances of the case and in law, Ld.CIT(A) has erred in confirming addition of Rs.4,19,06,500/- u/s.69A of the Act.

3. The assessee has also sought admission of the following additional grounds of appeal:-

On the facts and circumstances of the cas, the Assessing Officer erred in issuing notice u/s 143(2) of the Income-tax Act, 1961 dated 13.08.2018 in violation of CBDT Instruction F. No. 225/157/2017/ ITA-II dated 23.06.2017? Viral C Shah Vs. ITO Asst. Year : 2017-18 - 2– 4. The facts of the case are that the assessee filed his return of income on 31.03.2018 declaring total income at Rs.15,00,000/-. The return was processed u/s 143(1) of the Act without any modification. The case was selected for scrutiny under CASS and a notice u/s 143(2) of the Act was issued to the assessee on 23.09.2018. During the course of assessment proceeding, the assessee was asked to explain the total cash deposits of Rs.4,19,06,500/- made during the demonization period. The assessee furnished the copy of bank account statement before the Assessing Officer and submitted that the said cash deposited belonged to other parties and not appellant. The said cash deposited in assessee’s bank accounts were transferred immediately to the parties to whom the same belonged. The Assessing Officer brushed aside the said contention and explanation offered by the assessee and made addition of Rs.4,19,06,500/- u/s 69A of the Act in the hands of the assessee in respect of the said cash deposits.

5.

Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT(A). However, due to non-compliance by the assessee, the Ld. CIT(A) proceeded to decide the appeal ex parte and upheld the addition made by the Assessing Officer.

6.

Aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before the Tribunal.

7.

We have considered the rival submissions and carefully examined the material available on record. In the present case, the assessment for the Assessment Year 2017-18 was completed on 26.11.2019 by the Income-tax Officer, Ward 3(3)(5), Ahmedabad, determining the total income at Rs.4,34,06,500/- as against the returned income of Rs.15,00,000/-, vide order passed under section 143(3) of the Act.

8.

It is observed that the assessee did not comply with the notices issued during the assessment proceedings, nor did he respond to the notices issued by Viral C Shah Vs. ITO Asst. Year : 2017-18 - 3– the Ld. CIT(A), which resulted in the passing of the ex parte order dated 22.08.2023. We also find that even before this Tribunal, the assessee has repeatedly sought adjournments and failed to cooperate in the proceedings. Such recalcitrant attitude of the assessee cannot be encouraged, as it hampers the process of justice and effective disposal of matters.

9.

Nevertheless, in the interest of substantial justice, we are of the considered opinion that the assessee deserves one final opportunity to represent his case. Accordingly, we set aside the impugned order of the Ld. CIT(A) and remand the matter to the file of the Assessing Officer for de novo adjudication in accordance with law, after affording due and reasonable opportunity of being heard to the assessee.

10.

At the same time, in order to discourage such recalcitrant attitude and non-cooperative conduct of the assessee in future, we deem it fit to impose a cost of Rs.5,000/- (Rupees Five Thousand only) on the assessee. The said amount shall be paid to the Prime Minister’s National Relief Fund (PMNRF) within 30 days from the date of receipt of this order, and proof of such payment shall be furnished before the Assessing Officer.

11.

In the result, the appeal of the assessee is allowed for statistical purposes in the terms indicated above.

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