ANSARI STEEL,RAJKOT vs. INCOME TAX OFFICER, WARD 1(1)(1), RAJKOT

3. That the CIT Appeals is not justified in upholding the action of AO in adding the aggregate amount of Rs.1,51,12,000/- to the income of the appellant in respect of unsecured loan received from three parties, namely M/s Ansari Enterprise Rs.1,12,64,000/-, Sayarabanu M. Ansari Rs.10,94,000/- and Yashmin Martuja Ansari Rs.16,87,000/- as an unexplained cash credit under section 68 of the Act by arbitrary concluding that “genuineness and creditworthiness of lender could not be established”, concluded solely on the basis of income appearing in copy of ITR of respective lenders overlooking other documents and other aspects like networth etc., which were very much justifying the genuineness and creditworthiness of the lenders.

4. That the CIT Appeals is not justified in upholding the action of AO in adding the amount of Rs.53,935/- (being as ad hoc disallowance @ 14% of Rs.3,85,253/- which is total of all expenses, except purchase expense) to the total income of the appellant as business income.

3. At the outset, Ld. Counsel for the assessee assailed the impugned order by contending that assessee, could not file the details and documents before the Ld. CIT(A), during the appellate proceedings, due to circumstances beyond its control. Now, Ld. Counsel stated that assessee is ready with the documents and details and wants to submit the same before Ld.CIT(A). Learned Counsel further submits that during the appellate proceedings, notices were not served on the assessee, therefore, assessee could not appear before the ld. CIT(A), therefore, ld.CIT(A) has passed the ex parte order. The ld Counsel prays the Bench that an another Ansari Steel opportunity to contest the appeal before the First Appellate Authority may be granted to the assessee.

4. On the other hand, the ld. Senior DR for the revenue submitted that assessee was negligent in its approach and did not appear before the Ld. CIT(A).The ld.DR stated that cost may be imposed on the assessee, as the assessee has been negligent in pursuing the appeal before CIT(A).

5. We have heard both the parties and carefully gone through the submission and other materials brought on record. We note that in the assessee’s case under consideration, the assessment was carried out u/s 143(3) r.w.s 144B of the Act and the impugned order passed by the ld. CIT(A), is an ex parte order and non-speaking order, therefore, we do not wish to make any comments on the merits of the grounds raised by the assessee. Considering the above facts, we note that assessee has not given sufficient opportunity of being heard and could not plead its case successfully before the Ld. CIT(A). It is settled law that principles of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard to contest its case. Accordingly, we hold that the interests of justice would be met, if we set aside the order of CIT(A) and remit the matter back to the file of Assessing Officer with a direction to pass fresh assessment order in accordance with law after granting adequate opportunity of hearing to the assessee. The assessee is directed to be more vigilant and diligent and to furnish all the details and explanations as needed by the Assessing Officer by not seeking adjournment without valid reasons. Since we have remitted back the issue to the file of Assessing Officer, we do not intend to adjudicate each ground separately. With these directions, the grounds of appeal raised by the assessee are allowed for statistical purposes.

Order is pronounced in the open court on 31/12/2025.