GHANSHYAMBHAI NANALAL CHARANDAS,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD-3(3)(1) (PREVIOUSLY WARD-3(3)(2)), AHMEDABAD

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ITA 298/AHD/2024Status: DisposedITAT Ahmedabad16 January 2025AY 2015-16Bench: Shri T.R. Senthil Kumar (Judicial Member), Shri Narendra Prasad Sinha (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the CIT(A), NFAC passed an ex-parte appellate order without considering the assessee's written submissions and the Assessing Officer's remand report. In the interest of natural justice, the matter was set aside back to the CIT(A), NFAC for consideration on merits with a proper opportunity of hearing.

What were the facts?

The assessee is an individual engaged in real estate business. For AY 2015-16, the return was subjected to limited scrutiny, and additions of Rs. 88,60,909/- and Rs. 75,19,000/- were made for cash deposits and unexplained investment in land, respectively. The CIT(A) dismissed the assessee's appeal ex-parte.

What were the issues?

Whether the ex-parte appellate order passed without considering the assessee's submissions and remand report is valid. Whether the additions made by the AO were beyond the scope of limited scrutiny.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “B” BENCH

Before: Shri T.R. Senthil Kumar & Shri Narendra Prasad Sinha

ITA No: 298/Ahd/2024 Assessment Year: 2015-16 Ghanshyambhai Nanalal Income Tax Officer, Charandas Ward-3(3)(1), 23, Sangini Bungalows Vs (Previously Thaltej, Silaj Road, Ward-3(3)(2), Thaltej Ahmedabad Ahmedabad-380054 PAN: ADOPC5669A (Respondent) (Appellant) Assessee Represented: Shri Anil Kshatriya, A.R. Revenue Represented: Shri Nitin Vishnu Kulkarni, Sr.D.R. Date of hearing : 09-01-2025 Date of pronouncement : 16-01-2025 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-

This appeal is filed by the Assessee as against the ex-parte appellate order dated 29.12.2023 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the assessment order passed under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2015-16.

A.Y. 2015-16 Page No 2 Ghanshyambhai Nanalal Charandas. vs. ITO

Brief facts of the case is that the assessee is an individual engaged in the business of real estate, income from house property and other sources. For the Asst. Year 2015-16, assessee filed his Return of Income on 25-04-2016 declaring total income of Rs.6,31,710/- along with agricultural income of Rs.28,00,000/-. The return was taken for limited scrutiny assessment and assessment was completed on total income of Rs.1,70,11,619/- by making addition of Rs.88,60,909/- on cash deposits and Rs. 75,19,000/- as unexplained investments in land and demanded tax thereon.

Aggrieved against the assessment order, assessee filed an appeal before Ld. CIT(A), who gave eight opportunity of hearings between 18-07-2018 to 12-12-2023. As there was no response from the assessee, the appeal was dismissed by passing exparte order and confirming the additions made by the Assessing Officer.

Aggrieved against the same, the assessee is in appeal before us raising the following Grounds of Appeal:

1. On the facts and circumstances of the case and in law, the Order so passed by the Ld. AO & the Ld. CIT(A) NFAC is bad in law, illegal and exceeding the jurisdiction conferred under the limited scrutiny assessment for "large cash deposit in saving bank account", besides being in violation of the principle of natural justices & equity, as having been passed without considering the material already placed on records; as such liable to be quashed and set aside.

2. On the facts and circumstances of the case and in law, the Ld. CIT(A) NFAC has grossly erred in dismissing grounds of appeal so raised before him and thereby, further erred in concurring with the A.O. in making addition of Rs.88,60,909/- on account of unexplained cash credit, when there is no justification. The impugned additions so made by the A.O. may kindly be deleted.

A.Y. 2015-16 Page No 3 Ghanshyambhai Nanalal Charandas. vs. ITO

3. On the facts and circumstances of the case and in law, the Ld. CIT(A) NFAC has grossly erred in dismissing grounds of appeal

so raised before him and thereby, further erred in concurring with the A.O. in making addition of Rs.75,19,000/- on account of alleged unexplained investment in land which is beyond the scope of limited scrutiny, as such there is no justification to concur with the finding of the A.O. The impugned additions so made by the A.O. may kindly be deleted.

5. Ld. Counsel Shri Anil Kshatriya appearing for the assessee submitted the assessment being a ‘limited scrutiny’ but the Assessing Officer travelled beyond the limited scope thereby the entire assessment order itself vitiated. Further Ld. A.O. has not obtained necessary sanction from Competent Authority to make ‘complete scrutiny assessment’ and therefore the entire assessment order is liable to be quashed. Ld. Counsel further submitted that during the appellate proceedings, the assessee filed detailed Written Submission dated 24-01-2019 in physical form before Ld. CIT(A)-3, Ahmedabad. In turn, Ld. CIT(A) vide his letter dated 22- 02-2019 called for a Remand Report from the Assessing Officer. In compliance, the Ld. A.O. filed his Remand Report on 23-07-2020 to Ld. CIT(A)-3, Ahmedabad. Subsequently the appeal was migrated to NFAC in September 2020, but without considering the Written Submission and Remand Report from the Assessing Officer, Ld. CIT(A) passed the exparte appellate order. However Ld. Counsel admitted that due to change in Tax Consultant, the assessee was not aware of the hearing dates given by Ld. NFAC, therefore pleaded the appellate order is liable to be set aside.

6. Per contra, Ld. Sr. D.R. Shri Nitin Vishnu Kulkarni appearing for the Revenue filed before us copy of the Remand Report dated 23- A.Y. 2015-16 Page No 4 Ghanshyambhai Nanalal Charandas. vs. ITO 07-2020 submitted by the A.O., which was filed before Ld. CIT(A)-3, Ahmedabad and acknowledged on 24-07-2020. Thus requested to set aside the matter back to the file of Ld. CIT(A), NFAC to decide the appeal on merits of the case.

7. We have perused the materials available on record including the various submissions filed by the assessee and copy of the Remand Report dated 23-07-2020 filed by the Department. Since Ld. CIT(A), NFAC passed the exparte appellate order without considering the Written Submission filed by the assessee as well as the Remand Report given by the Assessing Officer. In the interest of Principle of Natural Justice, we deem it fit to set aside the matter back to the file of Ld. CIT(A), NFAC to consider the appeal on merits and pass order by giving proper opportunity of hearing to the assessee. Needless to say, the assessee should cooperate by filing all relevant materials/documents and also free to raise the additional grounds before Ld. NFAC.

In the result, the appeal filed by the Assessee is allowed for statistical purpose.

Order pronounced in the open court on 16 -01-2025 Sd/- Sd/- (NARENDRA PRASAD SINHA) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad : Dated 16/01/2025 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue A.Y. 2015-16 Page No 5 Ghanshyambhai Nanalal Charandas. vs. ITO

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