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Facts
The assessee filed a return for AY 2018-19 declaring a low income. The Assessing Officer made additions for unexplained cash credit and other sources. The CIT(A) dismissed the assessee's appeal, upholding the additions and other issues.
Held
The Tribunal noted that the CIT(A) passed an ex-parte order without granting a proper opportunity of being heard. The Tribunal found that the Assessing Officer and CIT(A) did not consider the details related to agricultural income.
Key Issues
Whether the CIT(A) erred in passing an ex-parte order and confirming additions without providing a proper opportunity of being heard? Whether the AO/CIT(A) properly considered the agricultural income details?
Sections Cited
250, 68, 115BBE, 69C, 234B, 271AAC
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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH, AHMEDABAD
Before: Ms. Suchitra Kamble
आदेश/ORDER This is an appeal filed against the order dated 28-10-2025 passed by National Faceless Appeal Centre (NFAC), Delhi for assessment year 2018-19.
The grounds of appeal
are as under:- “Ex-parte Order:
1. 1. 1. 1. 1. The learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi ["CIT(A)"] erred in fact and in law in passing an ex-parte order u/s 250 of Income Tax Act, 1961 ("the Act").
2. The learned CIT(A) erred in fact and in law in passing an ex-parte order without granting proper opportunity of being heard.
3. The learned CIT(A) erred in fact and in law in upholding the validity of the assessment order passed by the AO which was not valid and liable to be quashed. Addition u/s 68
4. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making addition of Rs.24,87,349/- as unexplained cash credits u/s 68 of the Act.
5. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making addition without giving proper opportunity of being heard to the Appellant.
6. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in computing tax on the amount of Rs. 24,87,349/- u/s. 115BBE of the Act. Disallowance of Expenses 7. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in disallowing expenses of Rs.5,61,238/- being expenditure incurred wholly and exclusively for the purpose of agricultural income. 8. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making disallowance without giving proper opportunity of being heard to the Appellant. Addition u/s 69C 9. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making addition of storage expenditure of Rs.4,00,000/- as unexplained expenditure u/s 69C of the Act. 10. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making addition u/s 69C despite of the fact that the Appellant had not incurred any storage expenditure. 11. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in making addition without giving proper opportunity of being heard to the Appellant. 12. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in computing tax on the amount of Rs. 4,00,000/-u/s. 115BBE of the Act. Other Grounds: 13. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in charging interest u/s. 234B of the Act. 14. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in initiating penalty u/s 271AAC of the Act. 15. Your Appellant craves the right to add to or to alter, amend, substitute, delete or modify all or any of the above grounds of appeal.”
3. The assessee has filed return of income for assessment year 2018-19 on 24-07-2018 declaring total income of Rs. 430/- under normal provisions of Income Tax Act, 1961 as well as declared book profit u/s. 115JC at Rs. 430/-. The return of income was processed under limited scrutiny in respect of verification of agricultural income and statutory notices were issued to the assessee. In response to the statutory notices, the assessee furnished its submissions vide letter dated 26-11-2020. After taking into account, the assessee’s submissions, the Assessing Officer made addition of Rs. 24,87,349/- as unexplained on cash credit u/s. 68 and addition fors.3,336/- as income from other sources.
Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.
The ld. A.R. submitted that the CIT(A) has passed ex- parte order without giving opportunity to the assessee to contest the issue before the CIT(A).
The ld. D.R. relied upon the assessment order and the order of the CIT(A).
I have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the Assessing Officer despite giving all the details has not taken into account the details related to agricultural income and in fact the order of the CIT(A) also has not taken cognizance of the said details. Therefore, it will be appropriate to remand back this matter to the file of the Assessing Officer for proper verification of the details and adjudicate the issues on merits as per Income Tax Statutes. Needless to say, the assessee be given opportunity of hearing by following principles of the natural justice. 3
In the result, the appeal of the assessee is allowed for statistical purpose.