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Facts
The assessee, an individual, did not file an Income Tax Return (ITR) for AY 2016-17 despite engaging in significant financial transactions including credit card payments, interest income (subject to TDS u/s 194A), and sale of immovable property. Consequently, the case was reopened under section 147, and an ex-parte assessment was completed by the Assessing Officer under sections 147 r.w.s. 144 r.w.s. 144B, determining a total income including unaccounted investment. The Ld. CIT(A)/NFAC set aside this ex-parte order and remanded the matter to the AO for fresh assessment without adjudicating all grounds raised by the assessee, including legal challenges.
Held
The Income Tax Appellate Tribunal (ITAT) observed that the Ld. CIT(A)/NFAC erred by remanding the case to the Assessing Officer without adjudicating all grounds of appeal, both factual and legal, as required by section 250(6) of the IT Act. The ITAT set aside the CIT(A)'s order and directed CIT(A)-13, Pune, to decide the appeal afresh, adjudicating each ground separately through a speaking order after providing the assessee a reasonable opportunity of hearing.
Key Issues
Whether the CIT(A) erred in remanding the case to the AO for fresh assessment without adjudicating all grounds of appeal, including legal challenges to the validity of reopening under section 147 and the jurisdiction of NFAC.
Sections Cited
147, 148, 142(1), 144, 144B, 194A, 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 25.04.2025 passed by Ld. CIT(A)/NFAC for the assessment year 2016-17.
The appellant has raised the following grounds of appeal :-
1. Ground No.1: On the facts and circumstances of the case and in law, the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [CITIA), NFAC] has erred in setting aside the Assessment Order and referring the case back to the Ld. Assessing Officer for making a fresh assessment without adjudicating legal grounds (Ground Nos. 1, 2 and 3 raised by the Appellant). It is prayed that the Order passed by the Ld. CIT(A), NFAC be set- aside and the appeal be sent to the file of the Ld. Commissioner of Income Tax Appeals-13, Pune [‘CIT(A) Pune-13'] with a direction to decide the appeal afresh, adjudicating all the grounds, including legal grounds raised by the Appellant after providing reasonable opportunity of hearing to the Appellant as the Order of the Ld. CIT(A), NFAC is contrary to the following Orders of the Hon'ble ITAT : Shamrao Gopal Benake vs. ITO (ITA No.1036/PUN/2025) Eyegaar Optics India Private Limited vs. DCIT (I.T.A.No. 1347/Hyd/2024 and 1291/Hyd/2024) Phoenix Flexibles Private Limited vs. DCIT (ITA No.669/Ahd/2025 and C.O. No.53/Ahd/2025) Ground No.
2. On the facts and circumstances of the case and in law, the Ld. CIT(A), NFAC has erred in deciding the Appeal of the Appellant even when the Jurisdiction to decide the Appeal was with the Ld. CIT(A) Pune-13 and this fact was mentioned in the Appellant’s letter dated
15. March 2023 addressed to the Ld. CIT(A), NFAC. It is prayed that the due directions be issued for decision on the Appeal of the Appellant by the Ld. CIT(A), Pune-13. The Appellant craves leave to add, amend, alter, substitute, withdraw all or any of the above Grounds of Appeal anytime either before or during the hearing of the Appeal.”
3. Facts of the case, in brief, are that the assessee is an individual and has not furnished his return of income for the period under consideration. On the basis of information available with the Department the assessee was found to have entered into financial transactions such as payment of credit cards bills of more than Rs.24,00,000/- and earned interest income of Rs.60,75,000/- on which TDS u/s 194A was made and sold immovable property of Rs.1,42,00,000/-, however no return was furnished by the assessee. Accordingly, there was reason to believe that the above financial transaction has escaped assessment within the meaning of section of the IT Act. Accordingly, the case was reopened u/s 147 of the IT Act and notice u/s 148 of the IT Act was issued to the assessee. Subsequently, notice u/s 142(1) of the IT Act and show cause notice respectively were also issued to the assessee. Since the assessee was non-responsive the Assessing Officer completed the assessment u/s 147 r.w.s. 144 r.w.s. 144B of the IT Act and vide order dated 27.03.2022 determined total income at Rs.2,26,79,848/- as against no return filed by the assessee. The above assessed income includes addition on account of unaccounted investment of Rs.2,26,79,848/-.
Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A)/NFAC. After considering the statement of facts, grounds of appeal
and written submissions, Ld. CIT(A)/NFAC set-aside the ex-parte assessment order and remanded the matter back to the file of the Assessing Officer for making a fresh assessment.
5. It is the above order against which the assessee is in appeal before this Tribunal.
6. We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee. In this regard, we find that the assessee has raised as many as eleven grounds before Ld. CIT(A)/NFAC, however Ld. CIT(A)/NFAC without adjudicating each and every grounds separately, remanded the matter back to the file of the Assessing Officer for passing the assessment order afresh. We further find that the assessee has also challenged the validity of reopening of the assessment u/s 147 of the IT Act and also challenged passing of the assessment order by National Faceless Assessment Centre, Delhi, before Ld. CIT(A)/NFAC, however, Ld. CIT(A)/NFAC has not adjudicated these legal grounds.
7. Considering the totality of the facts of the case, we find force in the arguments of Ld. Counsel of the assessee that in the light of section 250(6) of the IT Act, Ld. CIT(A)/NFAC was required to decide each and every ground either factual or legal separately by a speaking order. Accordingly, we deem it appropriate to set-aside the order passed by Ld. CIT(A)/NFAC and without going into merits of the case, remand the matter back to the file of Ld. CIT(A)- 13, Pune with a direction to decide the appeal afresh and as per fact and law adjudicating each and every ground separately by a speaking order after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to respond to the notices issued by Ld. CIT(A)-13, Pune and produce relevant