YAKUB IBRAHIM DOBA,SURAT vs. ITO, WARD 2(2)(5), SURAT
Facts
The assessee purchased two immovable properties and the difference between the purchase consideration and the stamp duty valuation was treated as income under section 56(2)(vii)(b) of the Act. The Assessing Officer added this difference to the total income, which was confirmed by the CIT(A). The assessee appealed to the Tribunal.
Held
The Tribunal observed that the CIT(A) passed an ex-parte order without giving adequate opportunity of hearing to the assessee. Therefore, the Tribunal set aside the order of the CIT(A) and restored the matter back to the file of the CIT(A) for a fresh decision.
Key Issues
Whether the CIT(A) erred in confirming the addition made by the AO without providing adequate opportunity of hearing to the assessee.
Sections Cited
56(2)(vii)(b), 143(3), 250
AI-generated summary — verify with the full judgment below
Before: SHRI SANJAY GARG & SHRI BIJAYANANDA PRUSETH
आदेश / O R D E R PER BIJAYANANDA PRUSETH, AM: This appeal by the assessee emanates from the order passed under section
250 of the Income-tax Act, 1961 (in short, ‘the Act’), dated 15.01.2025 by the
National Faceless Appeal Centre, Delhi/ Commissioner of Income-tax (Appeals) [in
short, ‘CIT(A)’] for the Assessment Year (AY) 2014-15, which in turn arises out of
assessment order passed by Assessing Officer (in short, ‘AO’) u/s 143(3) of the Act
dated 30.11.2016.
Grounds of appeal raised by the assessee are as under:
“1. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in making addition of Rs.52,68,777/- on account of share difference between purchase consideration Value and fair market value determined by the stamp duty valuation authority treated as income u/s.56(2)(vii)(b) of the I.T. Act.
ITA No.322/SRT/2025/AY.14-15 Yakub Ibrahim Doba
On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has not offered adequate opportunities to hear the case and passed ex-parte order and hence the case may please be set aside and restored back to the CIT(A) or AO for sake of the interest of natural justice.
It is therefore prayed that the above addition may please be deleted as learned members of the tribunal may deem it proper.
Appellant craves leave to add, alter or delete any ground(s) either before or in the course of the hearing of the appeal.”
Facts of the case in brief are that assessee had filed his return of income on
28.03.2016 declaring total income at Rs.1,98,030/-. The case of the assessee was
selected for scrutiny through CASS. During the assessment proceedings, notices
u/s.143(2) and 142(1) of the Act were issued to the assessee seeking details on
relevant issues. In response to the same, written submission was filed by the
assessee. It was observed that during the year under consideration, assessee had
purchased two immovable properties along with other 2 co-owners and there was
difference of Rs.52,68,777/- between their purchase considerations and fair
market value determined by the stamp duty valuation authority. On the aforesaid
difference of Rs.52,68,777/-, provision of section 56(2)(vii)(b) of the Act was
attracted. The AO issued show cause notice on 11.11.2015 and its reminder on
24.11.2016 to the assessee. However, no reply/explanation was furnished in its
compliance. The aforesaid difference of Rs.52,68,777/- was, therefore, added to
the total income of the assessee u/s.56(2)(vi)(b) of the Act. assessment order.
Aggrieved by the addition made by AO, assessee preferred appeal before
CIT(A). In appellate proceedings, the CIT(A) issued notice of hearing on 23.12.2020.
ITA No.322/SRT/2025/AY.14-15 Yakub Ibrahim Doba
In its compliance, assessee furnished part details vide his replies dated 12.12.2022,
25.12.2022, 11.03.2024. In order to get more clarity on the issue, CIT(A) issued
further notice on 24.12.2024; however, assessee did not furnish any documentary
evidence and simply filed reply on 29.12.2024 stating “Kindly consider earlier
submissions in response to this notice.
4.1 The CIT(A) observed that the assessee failed to adduce any evidence either
in support of his claim or to refute the observations made by the AO or to further
clarify the issue. Therefore, CIT(A) dismissed the appeal of the assessee without
adjudicating it on merits, vide its order dated 15.01.2025.
Aggrieved by the order of the CIT(A), assessee has filed present appeal
before the Tribunal. The Ld. AR of the assessee submitted that necessary
details/documents were filed in response to the notices issued by the CIT(A) from
time to time. Besides, no remand report has been called for from the AO by the
CIT(A). On the contrary, CIT(A) dismissed the appeal of the assessee without
adjudicating the same on merits. Therefore, it was prayed that order of CIT(A) may
be set aside and remitted to the file of CIT(A).
On the other hand, Ld. Sr. DR relied on the order of lower authorities. He
would, however, have no objection if the matter may be restored back to the file
of CIT(A).
We have heard both the parties and perused the materials on record. The
Ld. AR has argued that the CIT(A) has passed order without giving reasonable and
ITA No.322/SRT/2025/AY.14-15 Yakub Ibrahim Doba
sufficient opportunities of being heard to assessee. The CIT(A) dismissed the
appeal of assessee by passing a mechanical order without discussing merits of the
case. He has simply confirmed the addition made by AO without elaborating the
issues in a proper manner. Ld. AR argued that appellate orders of the CIT(A) are to
state the points arising in the appeal, the decision of the authority thereon and the
reasons for such decisions. Considering the facts and circumstances of the case
and the submission of Ld. AR that the Assessing Office made addition for the want
of evidence, which was confirmed by CIT(A) in ex parte order, we are of the
considered view that the assessee deserves one more opportunity to contest its
case on merit. Accordingly, without delving deeper into the merits of the case, in
the interest of justice, we set aside the order of Ld. CIT(A) and restore the matter
back to the file of CIT(A) to pass fresh appellate order in accordance with law after
granting adequate opportunity of hearing to assessee. The assessee is directed to
be vigilant and to furnish all details and explanation as needed by CIT(A) by not
seeking adjournment without valid reason. The ground of appeal raised by the
assessee is allowed for statistical purposes.
In the result, appeal filed by the assessee is allowed for statistical purpose. Order pronounced in accordance with Rule 34 of ITAT Rules, 1963 On 26/09/2025 in the open court. Sd/- Sd/- (SANJAY GARG) (BIJAYANANDA PRUSETH) �याियक सद�य/JUDICIAL MEMBER लेखा सद�य/ ACCOUNTANT MEMBER सूरत /Surat
ITA No.322/SRT/2025/AY.14-15 Yakub Ibrahim Doba िदनांक/ Date: 26/09/2025 Dkp Outsourcing Sr.P.S* आदेश की प्रितिलिप अग्रेिषत/ Copy of the order forwarded to : अपीलाथीर्/ The Appellant प्र�यथीर्/ The Respondent आयकर आयुक्त/ CIT आयकर आयुक्त (अपील)/ The CIT(A) िवभागीय प्रितिनिध, आयकर अपीलीय आिधकरण, सूरत/ DR, ITAT, SURAT गाडर् फाईल/ Guard File By order/आदेश से, // True Copy // सहायक पंजीकार आयकर अपीलीय अिधकरण, सूरत
