SHRI JITENDRASINH BHARATSINH CHAUHAN,SILVASSA vs. ITO, WARD-SILVASSA, SILVASSA

PDF · subscribers
ITA 969/SRT/2024Status: DisposedITAT Surat07 March 20253 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal, in the interest of justice, restored the matter to the file of the Ld. CIT(A) for de-novo consideration. The Tribunal acknowledged the assessee's submission that a further opportunity of hearing before the Ld. CIT(A) was sought to substantiate the source of capital introduced in the books of accounts. Consequently, the ex-parte order passed by the Ld. CIT(A) was set aside, and the appeal was allowed for statistical purposes. The Tribunal did not decide on the merits of the additions made under Section 68, Section 14A, or the applicability of Section 115BBe. The operative direction is to allow the appeal for statistical purposes and restore the matter to the Ld. CIT(A) for a fresh adjudication.

What were the facts?

The assessee, Shri Jitendrasinh Bharatsinh Chauhan, filed an appeal against the order of the Commissioner of Income Tax (Appeals) - National Faceless Appeal Centre (NFAC), Delhi, for Assessment Year 2018-19. The Assessing Officer (AO) made additions of Rs. 52,30,000/- under Section 68 of the Income Tax Act, 1961, for unexplained capital introduced in his proprietary concern, M/s Shree Sai Transport, and Rs. 1,24,039/- under Section 14A read with Rule 8D for disallowance of expenses related to exempt income. The Ld. CIT(A) confirmed these additions after the assessee failed to appear for multiple hearings, leading to an ex-parte order. The assessee is now before the Income Tax Appellate Tribunal (ITAT) challenging the CIT(A)'s order.

What were the issues?

1. Whether the Ld. CIT(A), NFAC, Delhi erred in law and on facts by dismissing the appellant's appeal ex parte without adjudicating on the merits of the case, contrary to the mandate of Section 250(6) of the Income Tax Act? 2. Whether the Ld. CIT(A), NFAC, Delhi erred in law and on facts by confirming the AO's addition of Rs. 52,30,000/- under Section 68 of the Act, representing credit entry in the appellant's capital account with his proprietary concern, M/s Shree Sai Transport? 3. Whether the Ld. CIT(A), NFAC, Delhi erred in law and on facts by confirming the AO's addition of Rs. 1,24,039/- on account of disallowance of expenses incurred in relation to earning of exempt income under Section 14A read with Rule 8D of the Income Tax Rules? 4. Whether the Ld. CIT(A), NFAC, Delhi erred in law and on facts by upholding the AO's action to charge income tax at a higher rate as per Section 115BBe of the Act? Assessee's Contentions: The assessee argued that in the interest of justice, a further opportunity of hearing should be granted by the Ld. CIT(A) to substantiate the source of capital introduced. The assessee also implicitly contested the additions made by the AO and confirmed by the CIT(A) on merits by seeking a de-novo consideration. Revenue's Contentions: The judgment does not record any specific contentions from the Revenue before the Tribunal.

Which sections of the Income-tax Act were involved?

Section 68,Section 14A,Section 115BBe,Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: SHRI SIDDHARTHA NAUTIYAL & SHRI BIJAYANANDA PRUSETH

For Appellant: Shri Rajesh Upadhyay, A.R
For Respondent: Shri Mukesh Jain, Sr. DR
Hearing: 27.02.2025Pronounced: 07.03.2025

IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER & SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER (Assessment Year: 2018-19) Shri Jitendrasinh Bharatsinh Vs. Income Tax Officer, Chauhan, Silvassa Ward, Silvassa Plot No.9-Naroli, Athal, Silvasa, Income Tax Officer, D&NH-396230 NFAC, Delhi [PAN No.ABKPC8431C] (Appellant) .. (Respondent) Appellant by : Shri Rajesh Upadhyay, A.R. Respondent by: Shri Mukesh Jain, Sr. DR Date of Hearing 27.02.2025 Date of Pronouncement 07.03.2025 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax(Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated 08.08.2024 passed for A.Y. 2018-19.

2.

The assessee has raised the following grounds of appeal:

“1. Ld. CIT(A), NFAC, Delhi has erred in law and on facts to dismiss appellant’s appeal ex parte and that too without going into merits of the case as per the mandate of Section 250(6) the I.T. Act. 2. Ld. CIT(A), NFAC, Delhi has erred in law and on facts to confirm A.O.’s addition u/s 68 of the Act for Rs.52,30,000/- being credit entry in appellant’s capital account with his proprietary concern namely M/s Shree Sai Transport.

Shri Jitendrasinh Bharatsinh Chauhan vs. ITO Asst.Year –2018-19 - 2– 3. Ld. CIT(A), NFAC, Delhi has erred in law and on facts to confirm A.O.’s addition of Rs. 1,24,039/- made on account of disallowance of expenses incurred in relation to earning of exempt income u/s 14A read with Rule 8D of the I.T. Rule.

4. Ld. CIT(A), NFAC, Delhi has erred in law and on facts to upheld A.O.’s action to charge income tax at higher rate as per Section 115BBe of the Act.”

3.

The brief facts of the case are that during the course of assessment proceedings, the Assessing Officer noted that the assessee has added capital of Rs. 52,30,000/- during the year and the assessee submitted that the source of such capital was from personal capital savings. The Assessing Officer was of the view that the assessee has not substantiated his claim of accumulation of capital accounts savings with any workings or any supporting documentary evidences. Accordingly, the Assessing Officer added a sum of Rs. 52,30,000/- as income of the assessee under Section 68 of the Act. Further, the Assessing Officer also made disallowance under Section 14A amounting to Rs. 1,24,039/- to the income of the assessee.

4.

In appeal, Ld. CIT(A) issued several notices of hearing but none appeared on behalf of the assessee. Accordingly, Ld. CIT(A) confirmed the additions made by the Assessing Officer.

5.

The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(A).

6.

Before us, the Counsel for the assessee submitted that looking into the quantum of additions, in the interest of justice, the assessee may be provided one more opportunity of hearing before Ld. CIT(A) and he would Shri Jitendrasinh Bharatsinh Chauhan vs. ITO Asst.Year –2018-19 - 3– be able to substantiate the source of such capital introduced in his books of accounts.

7.

Accordingly, in the interest of justice, the matter is hereby restored to the file of Ld. CIT(A) for de-novo consideration.

8.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced under proviso to Rule 34 of ITAT Rules, 1963 on 07/03/2025

More judgments on Section 68

All 29,931 judgments and leading authorities on Section 68 →

Latest GST High Court judgments

Search GST case law →