SACHIN MANILAL SHAH,PANVEL vs. ITO WARD 2, PANVEL

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ITA 1925/PUN/2024Status: DisposedITAT Pune13 January 2026AY 2013-14Bench: Dr. MANISH BORAD (Accountant Member), MS. ASTHA CHANDRA (Judicial Member)5 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the ex-parte order of the CIT(A), noting that the assessee contended the property was purchased by a firm (M/s Om Developers) in which he is a partner, not by him individually. The matter is restored to the file of the CIT(A) for fresh adjudication on merits, after providing proper opportunity of hearing to the assessee and considering all submissions, and passing a speaking order as per law.

What were the facts?

For A.Y. 2013-14, the Assessing Officer (AO) initiated reassessment proceedings against the individual assessee, who had not filed a return of income, based on information about an alleged undisclosed purchase of immovable property amounting to Rs. 1,39,19,000/-. Due to the assessee's non-compliance with statutory notices, the AO completed a best judgment assessment, making the said addition. The Commissioner of Income Tax (Appeals) [CIT(A)] dismissed the assessee's appeal ex-parte due to continued non-compliance.

What were the issues?

Whether the CIT(A) was justified in dismissing the appeal ex-parte without adjudicating the merits of the addition made on reassessment for an alleged undisclosed property purchase, which the assessee claims was made by a firm and not individually.

Which sections of the Income-tax Act were involved?

Section 250,Section 147,Section 144,Section 148,Section 142(1),Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, B BENCH,

Before: Dr. MANISH BORAD & MS. ASTHA CHANDRA

For Appellant: Shri Kaushik Makwana and Shri Sanjay Kabra
For Respondent: Shri Aviyogi Ambadkar
Hearing: 13.01.2026Pronounced: 14.01.2026

Assessee by : Shri Kaushik Makwana and Shri Sanjay Kabra Revenue by : Shri Aviyogi Ambadkar, Addl.CIT Date of hearing : 13.01.2026 Date of pronouncement : 14.01.2026 आदेश/ORDER

PER DR.MANISH BORAD, ACCOUNTANT MEMBER :

1.

This appeal at the instance of the assessee is directed against the order of Ld. CIT(A) NFAC, Delhi dated 12.07.2024 framed u/s 250 of the Income Tax Act, 1961 for A.Y. 2013-14 which is arising out of order passed u/s 147 r.w.s. 144 of the Act dated 10.09.2021.

2.

Assessee has raised following grounds of appeal:-

1. On the facts and circumstances of the case and in law, the learned CIT(A) has erred in dismissing the appeal without considering the facts, explanation and documents submitted at the time of filing the appeal by the appellant.

2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing the appeal and confirming an addition of Rs 1,39,19,000 on account of purchase of immovable property being allegedly treated as undisclosed sources vide order u/s 144 r.w.s 147 of the Income Tax Act, 1961 dated 10.09.2021.

3. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing the appeal and confirming an addition of Rs 1,39,19,000 on account of purchase of immovable property made by the Ld. AO which violates the provision of Section 147 of the Income Tax Act, 1961.

4. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing the appeal and confirming an addition of Rs 1,39,19,000 on account of purchase of immovable property made by the Ld. AO ignoring the facts that the notice u/s 148 was issued merely on the basis of third-party information.

5. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that the re-opening were based upon incorrect facts. That the immovable property was purchased by the Firm called "Om Developers" in which appellant is a partner and not by the appellant in his individual capacity. The said immovable property does not pertain to the appellant.

6. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing an appeal and confirming an addition made by the Ld. AO without any application of mind and without considering the facts and circumstances of the case.

7. On the facts and circumstances of the case and in law, neither the learned CIT(A) non the learned Assessing Officer has made any independent inquiry relating to the information received from third party. The basis of reopening itself is wrong and therefore the whole proceeding is void ab initio.

8. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing an appeal and confirming an addition made by the Ld. AO merely on the basis of surmises and conjectures and without bringing on record any material to prove that the appellant has actually bought an immovable property other than the third party information. The said immovable property has been bought in the name of the firm "Om Developers" and not in the name of the appellant during the year under consideration.

9. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing an appeal and confirming an addition made by the Ld. AO of Rs. 1,39,19,000/- in the hands of the appellant without appreciating the fact that the immovable property was purchased by the Firm in which appellant is a partner and not by the appellant in his individual capacity.

10. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing an appeal and confirming an addition made by the Ld. AO of Rs 1,39,19,000/- in the hands of the appellant without appreciating the fact that the immovable property was purchased by the Firm M/s Om Developers vide registered agreement dated 19.12.2012 no 11893/2012 duly registered at office of sub register -3 panvel clearly mentioned that the sources of the fund including the copies of the details of the cheques through which sale consideration was paid to the seller and which clearly establishes that entire sum has been contributed by the other partner of the Firm.

11. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in dismissing an appeal and confirming an addition made by the Ld. AO which is on the basis of arbitrary and has originated on wrong footing and therefore the same may be set aside.

12.

That the appellant craves leave to add, alter, modify or amend the grounds of appeal before the appeal is heard and disposed off.

3.

We observe that the assessee has raised effectively 11 grounds of appeal. Assessment for A.Y. 2013-14 has been framed as best assessment u/s 144 and impugned order of Ld. CIT(A) is ex-parte quo assessee as the assessee failed to make any compliance on four occasions to the notice of hearing issued by Ld. CIT(A) who has dismissed the assessee’s appeal observing that the appellant is not interested in presenting his appeal. Before us the Ld. Counsel for the assessee as well as Ld. Departmental Representative (DR) raised no objection if the issues raised in the instant appeal are restored to the file of Ld. CIT(A) for necessary adjudication and for passing a speaking order.

4.

We have heard rival contentions and perused the records placed before us. The assessee is an individual and did not file the return of income for A.Y. 2013-14. Based on the information about purchase of immovable property Ld. AO had reason to believe that the income to the extent of Rs. 1,39,19,000/- has escaped. Ld. AO issued notice u/s 148 of the Act on 04.03.2020 duly served upon the assessee. However, the assessee failed to file any return thereof. Ld. AO in order to complete the assessment proceedings, issued notice u/s 142(1) of the Act, 1961 on various dates alongwith questionnaire but again there was no compliance. Inspite of repeated opportunity granted to the assessee, the assessee did not respond to the AO. AO passed best judgement assessment u/s 148 of the Act and made addition for income from undisclosed sources of Rs. 1,39,19,000/- in the assessment order dated 10.09.2021. Assessee preferred appeal before Ld. CIT(A) which was instituted on 21.02.2022 but subsequently on the date of hearing fixed on 22.12.2023, 19.04.2024, 15.05.2024 and 24.05.2024 there was no compliance on the assessee’s side to the notices sent on e-mail id sachi.1617@gmail.com mentioned in Form 35. Ld. CIT(A) has therefore dismissed the assessee’s appeal without adjudicating the merits of the case.

5.

Before us Ld. Counsel for the assessee has made reference to the statement of facts stating that the alleged immovable property has been purchased by the Firm M/s Om Developers in which the assessee is a partner however considering the impugned ex-parte order, he had prayed for one more opportunity of hearing.

6.

We therefore in the larger interest of justice and being fair to both the parties, set aside the impugned order and restore all the issues raised in the instant appeal to the file of Ld. CIT(A) for necessary adjudication to be carried out after duly considering the submissions and details to be filed by the assessee and Ld. CIT(A) shall pass a speaking order as contemplated u/s 250(6) of the Act. Needless to mention that proper opportunity of hearing shall be granted to the assessee. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Effective grounds of appeal raised by the assessee are allowed for statistical purposes.

7.

In the result appeal of the assessee is allowed for statistical purposes.

Order pronounced on this 14th day of January, 2026.

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