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Facts
The assessee appealed against an ex-parte order by the CIT(A) which confirmed an addition of Rs. 66,55,238 under Section 69 for unexplained investment, following a re-assessment under Section 148. The assessee contended that they had filed submissions, which the CIT(A) acknowledged in one part of the order but contradicted by stating the assessee did not respond, leading to the ex-parte dismissal.
Held
The Tribunal found the CIT(A)'s action contradictory and perverse, indicating a non-application of mind. Consequently, the Tribunal set aside the CIT(A)'s impugned order and restored the appeal file back to the CIT(A) with a direction to consider the assessee's submissions and adjudicate the grounds of appeal on merits. The stay petition was dismissed as infructuous.
Key Issues
Whether the CIT(A) erred in passing an ex-parte order dismissing the appeal, despite acknowledging the assessee's submissions, and whether this indicated a non-application of mind.
Sections Cited
Section 148, Section 69, Section 250(6)
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Income Tax Appellate Tribunal, B BENCH: CHENNAI
आदेश / O R D E R
PER ABY T. VARKEY, JM:
action of the Ld.CIT(A)/NFAC dated 27.11.2025 for AY 2020-21. And the Stay Petition has been filed by the assessee against the demand raised pursuant to the quantum assessment being confirmed by the impugned order of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi dated 27.11.2025 for the Assessment Year 2020-21.
At the outset, the Learned Counsel for the assessee submitted that the Ld.CIT(A) has passed an ex parte order on the specious plea that assessee didn’t respond to his notice, which is per se erroneous, because assessee had in fact filed his response before the Ld.CIT(A) and the Stay Petition has been filed for stay of the outstanding demand of Rs.91,61,444/- since the Assessee has paid 20% of the outstanding demand and pleaded for stay of the outstanding demand.
Per contra, the Ld.DR submitted that the Ld.CIT(A) passed an ex- parte order because the assessee failed to participate in the First Appellate proceedings, which resulted in the dismissal of the appeal and therefore, he prayed that the demand should not be stayed.
In her rejoinder, the Ld. Counsel for the Assessee submitted that the Assessee had in fact uploaded the submissions before the Ld. CIT (A) on 1st July 2025 & 25th October 2025, which fact has been acknowledged by the Ld. CIT(A) in his impugned order. Therefore, according to her, the impugned action cannot be termed as an ex-parte order, and hence, it cannot be even said that the assessee didn’t participate in the first Appellate proceedings. Further, the Ld. Counsel brought to our notice that the Ld.CIT(A), despite acknowledging that the assessee had filed his
SP No.123/Chny/2025 & (AY 2020-21) Suyambu :: 3 :: submissions (supra), curiously observed that the Assessee did not file any submissions in support of the grounds of appeals before him, which assertion of Ld CIT(A) is contradictory. Therefore, according to her, the impugned action of the Ld. Ld. CIT(A) is bad in law since there was no application of mind by the First Appellate Authority. Therefore, since the impugned action of the Ld. CIT(A) is ex-facie bad in law, she asserted that impugned action is unsustainable and prayed for restoration of appeal before the Ld.CIT(A), since the Ld CIT(A) didn’t pass order on merits.
5. Heaving heard rival submissions and after perusal of the material on record, we note that Assessee did not file his return of income in the relevant assessment year for consideration. Based on certain information received from the Insight Portal under RMS Category, the Assessing Officer is noted to have re-opened the Assessment by issuing the notice under Section 148 of the Income Tax Act 1961 hereinafter referred to as Income Tax Act 1961 (hereinafter “the Act”) and after hearing the assessee made addition of Rs.66,50,238/- u/s.69 of the Act, which was challenged before the Ld. CIT,(A).
6. The assessee is noted to have filed his submissions before the Ld.CIT(A) on 01.07.2025 (as acknowledged by the Ld. CIT,(A) at para 04 of the impugned order). Further, the assessee also submitted that he had also filed his submission on 15.10.2025. Having acknowledged that assessee had filed his submission before him on 01.07.2025, we note that the Ld. CIT(A) took a contradictory stand by observing at Para 5.1.2 (of his impugned order) that despite issuance of several notices, the Assessee didn’t respond and hence, he was of the view that the Assessee wasn’t interested in pursuing the appeal and therefore, he passed an ex- parte order qua the assessee and confirmed the addition of Rs. 66,55,238 under Section 69 as unexplained investment.
7. We don’t countenance the impugned action of the Ld.CIT(A), we find at Para No.4 of the impugned order, that the Ld.CIT(A) accepts that the assessee has filed submission on 01.07.2025. But at para 5.1.2, he states that the assessee didn’t respond to his notices which we find to be per-se contrary and therefore perverse, which exposes the non- application of mind of Ld.CIT(A). Therefore, we are inclined to set aside the impugned order of the Ld. CIT,(A) and restore the appeal file back to the Ld.CIT(A) with the direction to consider submissions filed by the Assessee and after hearing the assessee, adjudicate the grounds of SP No.123/Chny/2025 & (AY 2020-21) Suyambu :: 5 :: appeal raised by the assessee as stipulated under Sub-Section (6) of section 250 of the Act and in accordance with the law. The Ld. Counsel for the assessee undertakes to participate before the Ld. CIT(A)/NFCA, Delhi.
Since the main-appeal has been disposed off supra, the Stay- Petition filed by the assessee is academic & infructuous, and so, dismissed
In the result, the appeal of the assessee is allowed for statistical purpose and Stay Petition filed by the assessee is dismissed as infructuous. Order pronounced on the 02nd day of January, 2026, in Chennai.
Sd/- Sd/- (प�ावती .एस) (एबी टी. वक�) (PADMAVATHY. S) (ABY T. VARKEY) लेखा सद�य/ACCOUNTANT MEMBER �याियक सद�य/JUDICIAL MEMBER चे�ई/Chennai, �दनांक/Dated: 02nd January, 2026. TLN