GRK CONSTRUCTIONS,VISAKHAPATNAM vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-3(1), VISAKHAPATNAM

Facts

The assessee, GRK Constructions, faced reassessment for AY 2014-15 after a GST Intelligence search revealed suppressed sales and unmaintained books. The Assessing Officer reopened the case under Section 148 and made a substantial addition for alleged on-money receipts, which was confirmed by the CIT(A) through an ex-parte order, who also levied a penalty under Section 271(1)(c), both due to the assessee's non-compliance.

Held

The Tribunal acknowledged the CIT(A)'s ex-parte orders were justified given the assessee's repeated non-appearance. However, in the interest of justice, it remitted both the quantum and penalty appeals back to the CIT(A) for fresh consideration on merits, granting the assessee one more opportunity, while cautioning them to cooperate.

Key Issues

Whether the ex-parte orders by CIT(A) were justified, the validity of reassessment proceedings under Section 148, the sustainability of quantum addition and penalty under Section 271(1)(c) given non-compliance.