ASHOK KUMAR KHATHURIA,105 KRANTI KRIPLANI NAGAR vs. CIT(A), DELHI

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ITA 230/IND/2025Status: DisposedITAT Indore24 December 2025AY 2013-20146 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the appeal filed by the assessee before the CIT(A) should not have been dismissed as non-maintainable. The Tribunal acknowledged that the assessee admitted to possessing both PANs (LBTPK8441A and ACPPK3556Q) but had subsequently surrendered the first PAN and was operating with the second. Therefore, filing the first appeal with the active PAN (ACPPK3556Q) was deemed appropriate. The Tribunal emphasized that both PANs belonged to the same assessee-individual. Considering the principles of natural justice and that no prejudice would be caused to the revenue, the Tribunal decided to restore the matter to the file of the CIT(A) for fresh adjudication. The assessee was directed to pay a cost of Rs. 5,000 to the Prime Minister National Relief Fund. The CIT(A) was instructed to provide the assessee with a necessary opportunity of hearing, consider the submissions, and pass an appropriate order without being influenced by the previous order. The assessee was also directed to ensure participation and avoid unnecessary adjournments. The Tribunal clarified that the CIT(A) should decide the appeal on merits under Section 250(6) and not treat it as non-maintainable. The department was granted liberty to take appropriate action regarding the holding of two PANs.

What were the facts?

The assessee, Ashok Kumar Khathuria, is in appeal before the Income Tax Appellate Tribunal (ITAT) against an order of the Commissioner of Income-Tax (Appeals)-NFAC, Delhi. The NFAC's order upheld an assessment order passed by the Income Tax Officer (ITO), Ward 1(2), Indore, under Section 147 read with Section 144 of the Income-tax Act, 1961, for Assessment Year 2013-14. The assessment order was passed ex-parte. The core of the dispute lies in the fact that the assessment was initiated and an order passed using PAN LBTPK8441A, while the appeal before the CIT(A) and the current appeal before the ITAT were filed using PAN ACPPK3556Q. The CIT(A) dismissed the appeal as non-maintainable because the assessment was in one PAN and the appeal was filed in another, despite the assessee's claims that the first PAN was surrendered.

What were the issues?

1. Whether the CIT(A) erred in sustaining the assessment order passed by the AO, given that statutory notices were issued to the appellant on a PAN (LBTPK8441A) that the assessee claims does not belong to him, and the appeal was filed under a different PAN (ACPPK3556Q)? (Mixed law and fact, turns on principles of natural justice and proper identification of assessee). 2. Whether the CIT(A) erred in dismissing the appeal as non-maintainable, considering the newly inserted clause (a) of Section 251 of the Act, effective from October 1, 2024, and the fact that both PANs belonged to the same individual? 3. Whether the CIT(A) erred in dismissing the appeal by ignoring the adjournment application filed by the appellant, thereby violating the principles of natural justice? 4. Whether the CIT(A) erred in sustaining the AO's additions of Rs. 29,22,000 in respect of short-term capital gain and Rs. 35,49,760 under Section 50C, without providing a proper opportunity to the assessee, thus violating natural justice and rendering the ex-parte order bad in law? Assessee's Contention: The assessee argued that the CIT(A) erred in sustaining the assessment order and dismissing the appeal. The primary contention is that notices were issued on an incorrect PAN, and the appeal was filed under the correct, active PAN after surrendering the other. The assessee also argued that the CIT(A) failed to consider meritorious grounds, ignored adjournment applications, and violated principles of natural justice. They relied on the fact that both PANs belonged to the same individual and that the first PAN was surrendered. Revenue's Contention: The Revenue did not object to a remand to the CIT(A) but prayed for strict directions to the assessee for cooperation and representation without unnecessary adjournments.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 251,Section 50C,Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, INDORE BENCH, INDORE

Before: SHRI SIDDHARTHA NAUTIYAL

For Appellant: Shri Pranay Goyal & Shri S.N. Goyal, ARs
For Respondent: Shri Ashish Porwal, Sr. DR
Hearing: 17.12.2025Pronounced: 24.12.2025

आदेश/ O R D E R

Per B.M. Biyani, A.M.:

1.

Feeling aggrieved by order of first-appeal bearing DIN: ITBA/NFAC/S/250/2024-25/1071832325(1) dated 02.01.2025 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 16.03.2023 passed by learned ITO-Ward 1(2), Indore [“AO”] u/s 147 r.w.s. 144 of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2013-14, the assessee has filed this appeal on following grounds:

Ashok Kumar Khathuria - AY 2013-14 “1. That, the Ld. CIT(A) erred to sustain the assessment order passed by the Ld. A.O. dt. 16.03.2023, such action of the Ld. CIT(A) is bad in law and on the fact. As the assessment order have been passed without considering the fact that all the statutory notices were issued to the appellant on the PAN which does not belongs to him i.e. LBTPK8441A.

2. That, the Ld. CIT(A) erred to dismiss the appeal vide order dt. 02.01.2025, which was preferred against the ex-party order passed u/s 147 r.w.s. 144 of the Act, such action of Ld. CIT(A) is unjustified as the same is against the newly inserted clause (a) of Sec. 251 of the Act, effective from 1st day of October, 2024.

3. That, the Ld. CIT(A) erred to dismiss the appeal filed before him, ignoring the adjournment application filed by the appellant, such action of the Ld. CIT(A) is against the principal of natural justice and opportunity of being heard.

4.

That, the Ld. CIT(A) erred to sustain the order passed by the Ld. A.O. by making addition of Rs. 29,22,000/-in respect of short-term capital gain and Rs. 35,49,760/- u/s 50C of the Act without giving proper opportunity to the assessee which is against the law of natural justice. Therefore, such an order passed u/s 144 of the Act is bad in law, hence should be quashed.

5. That, the Ld. CIT(A) erred to sustain the order passed by the Ld. A.O. by not bothering to consider the cost of acquisition of the immovable property, thus, such an order is bad in law hence should be quashed. The order so passed u/s 144 of the Aet may kindly be strike down.

6. That, the Ld. CIT(A) erred to sustain the order passed by the Ld. A.O. by acting in a hurried manner without considering the Indexed Cost of Acquisition, Cost of Improvement, Deductions u/s 54F of the Act, therefore, such an order is bad in law and order so passed u/s 144 of the Act, should be struck down immediately.

7. That, the Ld. CIT(A) erred to sustain on the facts and in law by making addition of Rs. 29,22,000/- in respect of short-term capital gain and Rs. 35,49,760/- u/s 50C of the Act is merely on the basis of assumptions, surmise and presumptions and without any corroborative evidence on record. Therefore, such an order is bad in law hence should be quashed. The order so passed u/s 144 of the Act may kindly be quashed.

8. The appellant craves leave to add, amend, modify and/or add new grounds of appeal before the appeal is heard and disposed off.”

2.

We have heard learned Representatives of both sides and case record perused.

Ashok Kumar Khathuria - AY 2013-14

3.

At first, we re-produced below the impugned order passed by Ld. CIT(A):

“5. During the course of appeal proceedings, hearing notices were issued on 03.10.2024 on the PAN in which the appeal was filed (PAN: ACPPK3556Q). In response to the notice, the appellant filed adjournment petition by requesting for 15 to 20 days time. As per his request, case was adjoumed to 06.11.2024. As he did not respond to that notice, the case was again posted for hearing on 24.11.2024 vide notice dated: 07.11.2024. The appellant again filed adjournment for the reason that, the documents are to be collected from the Registrar. Hence, the case was again adjourned to 12.12.2024. On the date of hearing also, the appellant filed one more adjournment letter. However, this cannot be accepted and the appeal is decided on merit as under.

6.

I have perused the order passed by the AO, statement of facts and grounds of appeal

filed by the appellant. The appellant used the PAN: LBTPK8441A for purchase and sale of certain immovable properties without filing any return of income on that PAN. He has indulged into such activity by quoting this PAN. This was reported by the SRO in the portal and the assessment was reopened on account of the fact that, no ITR was filed for the A.Y 2013-14 against this PAN. As the appellant did not respond to the notices issued by the AO, the assessment proceeding was completed on 16.03.2023. Prima facie he should have filed appeal against this order by referring the PAN: LBTPK8441A. However, he filed appeal with PAN: ACPPK3556Q by claiming in the statement of facts and the reasons for delay that, this is his PAN and not PAN: LBTPK8441A. If PAN: LBTPK8441A was not his PAN what has prompted him to quote this PAN for indulging into purchase and sale of immovable property has not been provided by the appellant. He has deliberately used that PAN by knowing that, he has other PAN: ACPPK3556Q. If any person maintained more than one PAN, they have to surrender the duplicate PAN. In the present case, from the facts submitted by the appellant, he possess two PAN. The transactions were entered in the PAN: LBTPK8441A and hence the assessment was reopened on account of not filing any return of income within due date. If the appellant had disclosed the transaction in the other PAN, he should have filed the return of income within the due date and disclosed the transaction against that PAN. It is seen that, he neither disclosed this transaction in PAN: LBTPK8441A nor in PAN: ACPPK3556Q. It is a clear-cut case of wilful evasion of tax.

7. In view of the above, the appeal filed by the PAN: ACPPK3556Q against the assessment order passed in the PAN: LBTPK8441A is not maintainable and hence the appeal is dismissed.”

4. Thus, in Para 5, Ld. CIT(A) has rejected adjournment application filed by assessee and proceeded to decide assessee’s first-appeal. Thereafter, vide

Ashok Kumar Khathuria - AY 2013-14 Paras 6 & 7, the CIT(A) has dismissed assessee’s first-appeal as non- maintainable stating that the assessee was having two PANs and the AO passed assessment-order in PAN: LBTPK8441A whereas the appeal before him was filed in PAN: ACPPK3556Q.

5.

Ld. AR admitted in open court that the assessee was having both of the PANs, as narrated above, but subsequently surrendered the first PAN:

LBTPK8441A and thereafter keeping the second PAN: ACPPK3556Q only. Therefore, the first-appeal was rightly filed to CIT in active PAN: ACPPK3556Q and the CIT(A) should not have dismissed assessee’s appeal.

Ld. AR further pointed out that the assessee has raised meritorious grounds in first appeal which need to be aptly adjudicated by Ld. CIT(A). Therefore, the present matter must be restored at the level of CIT(A). He acknowledged that the assessee is ready and willing to make a proper representation before CIT(A).

6. Ld. DR for revenue submitted that he does not have any objection against remand to CIT(A) but, however, he prays that the bench must give a strict direction to assessee for co-operation and representation before CIT(A) without seeking unnecessary adjournments.

7.

In view of above facts and considering the submissions of parties; having regard to the principle of natural justice and also bearing in mind that no prejudice would be caused to revenue if the present matter is restored at the level of CIT(A), we remand this matter back to the file of Page 4 of 6

Ashok Kumar Khathuria - AY 2013-14 CIT(A) for adjudication afresh subject to payment of cost of Rs. 5,000/- by assessee to Prime Minister National Relief Fund. The assessee shall submit receipt of such payment to CIT(A) during proceedings. The CIT(A) shall give necessary opportunity of hearing to assessee and pass an appropriate order after considering submissions of assessee, without being influenced by his previous order in any manner. The assessee is also directed to remain vigilant and ensure participation in the hearings as may be fixed by CIT(A) and do not seek unnecessary adjournments failing which the CIT(A) shall be at liberty to pass appropriate order in accordance with law. Ordered accordingly.

8.

Before parting, we would make it clear that the CIT(A) shall decide assessee’s first-appeal meritoriously in accordance with provisions of section 250(6) of the Act and shall not treat the assessee’s first-appeal as non- maintainable since both PANs belonged to this very assessee-individual and the assessee has already surrendered first PAN and keeping only second PAN as active. The department is, however, at liberty to take any other action as may be permitted under the provisions of law for obtaining or holding two PANs.

Ashok Kumar Khathuria - AY 2013-14

9.

Resultantly, this appeal is allowed for statistical purpose.

Order pronounced by putting up on notice board in terms of Rule 34 of ITAT Rules, 1963 on 24/12/2025

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