ANKUSHKUMAR MADHUBHAI NAKRANI,SURAT vs. ACIT, CENTRAL CIRCLE-2, SURAT

The assessee vide ITA No.539/SRT/2024 has contested the confirmation of addition of Rs.88,12,000/- made by the AO under section 69A of the Act. Whereas, vide ITA No.540/SRT/2024 the assessee challenges the confirmation of penalty levied by the AO

At the outset, the ld.counsel for the assessee invited our attention to the impugned orders of the ld.CIT(A) to submit that same are ex parte of the assessee. The ld.counsel for the assessee has invited our attention to appeal form before the ld.CIT(A) i.e. Form No.35 filed before the ld.CIT(A), wherein, email address of the assessee for service of notice has been mentioned as nakranee_ankush@yahooco.in. The ld.counsel has further invited our attention to the details of the notices issued by the ld.CIT(A), as downloaded from the income tax portal, which showed that the notices of hearing were sent by the ld.CIT(A) on different email address, which is mentioned as srshethtax@gmail.com. The ld.counsel for the assessee, therefore, has submitted that the notices sent through electronic mode by the ld.CIT(A) did not come to the notice of the assessee, because they were sent at different email-id and not at the email-id as mentioned in the Form No.35. He, therefore, has submitted that non-representation of the assessee before the ld.CIT(A) was not intentional, but due to the aforesaid reasons. He further submitted that the assessee a fair case on merits, and that the assessee may be given an opportunity to present his case before the ld.AO. In this respect, he has submitted that though the assessee had furnished various details and explanations before the AO, however, certain crucial facts and documents, which were relevant for just and proper decision of the case, have remained to be furnished before the AO. He, therefore, has requested that matter may be restored to the file of the AO.

The ld.DR, on the other hand, has relied on the above orders of the ld.CIT(A).

Having considered the rival submissions, we are of the view that the interests of justice will be well served, if the matter relating to the quantum addition is restored to the file of the AO. Therefore, the impugned order of the ld.CIT(A) is set aside and the matter relating to ITA No.539/SRT/2024 is restored to the file of the AO for de novo assessment on the issue.

As far as the matter relating to the levy of penalty under section 271AA(1) of the Act is concerned, the same is consequential to the quantum addition made/sustained. Since, we have already set aside the order of the ld.CIT(A) while adjudicating the ITA No.539/SRT/2024, and the matter has been restored to the file of the AO for assessment afresh on the issue, therefore, as on the date, there is no addition surviving against the assessee, and thus, the impugned penalty under section 271AAC(1) has legs to stand and the same is ordered to be deleted, and however, with the liberty to the AO that, if after passing of the fresh assessment order, if he will be of the view that the penalty under section 271AAC(1) of the Act is attracted in this case, he may initiate fresh penalty proceedings accordingly. 7. With the above observations, both the appeals of the assessee are treated as allowed for statistical purpose. Order pronounced on 19th June, 2025 Sd/- Sd/- (Bijayananda Pruseth) (Sanjay Garg) Accountant Member Judicial Member