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Facts
The assessee's case was reopened for A.Y. 2018-19 based on information of bogus purchases of Rs. 67,76,525/-, which were disallowed by the AO and confirmed by the CIT(A). The CIT(A) dismissed the assessee's appeal without examining the issue on merits due to non-compliance despite multiple opportunities.
Held
The ITAT set aside the matter to the CIT(A), directing that a final opportunity be given to the assessee to represent its case on merits. This was conditional on the assessee depositing a cost of Rs. 10,000/- to the Prime Minister National Relief Fund within 15 days, failing which the CIT(A) could decide based on available records.
Key Issues
Whether the disallowance of Rs. 67,76,525/- for bogus purchases was correct, and if the CIT(A) erred by dismissing the appeal without granting adequate opportunity to the assessee, violating natural justice.
Sections Cited
147, 144B, 250, 37, Rule 24 of ITAT Rules
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD
Before: MS SUCHITRA KAMBLE & SHRI NARENDRA PRASAD SINHA
PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:
This appeal is filed by the assessee against the order of National Faceless Appeal Centre(NFAC), Delhi [hereinafter referred to as ‘CIT(A)’], dated 30.12.2025 for the Assessment Year (A.Y.) 2018-19 in the proceeding u/s 147 r.w.s 144B of the Income Tax Act.
The brief facts of the case are that the case of the assessee was reopened on the basis of information that it had made bogus purchases from certain concerns. In the course of assessment, the AO was not satisfied with the explanation of the assessee and the purchase of Jagdish Indravadan Thakkar Vs. ITO 2 Rs.67,76,525/- was held as bogus and added to income. The assessment was completed u/s. 147 r.w.s. 144B of the Act on 27.02.2024 at total income of Rs.73,36,705/-.
Aggrieved with the order of the AO the assessee had filed an appeal before the First Appellate Authority, which was decided by the Ld. CIT(A) vide the impugned order and the appeal of the assessee was dismissed.
Now the assessee is in second appeal before us. The following grounds have been taken in this appeal.
1 The order passed u/s.250 on 30.12.2025 for A.Y.2018-19 by NFAC, CIT(A) Delhi [for short "CIT(A)] upholding disallowance of purchases to the extent of Rs. 67,76,525/- u/s 37 of the Act as non-genuine is wholly illegal, unlawful and against the principles of natural justice. 1.2 The Ld. CIT(A) has grievously erred in law and or on facts in not appreciating that there was reasonable cause for failure to respond on earlier three occasions and The Ld. CIT(A) ought to have allowed further opportunity of hearing or in alternative, informed the fate of the adjournment application. Thus there was gross violation of principles of natural justice and the appellant should be allowed to produce additional evidence under Rule 24 of ITAT Rules. 1.3 The Ld. CIT(A) has grievously erred in law and or on facts in not considering fully and properly the submissions made and evidence produced by the appellant with regard to the impugned addition before FAO. 2.1 The Ld.CIT(A) has grievously erred in law and on facts in confirming disallowance of purchases to the extent of Rs. 67,76,525/- u/s 37 of the Act as non-genuine. 2.2 That in the facts and circumstances of the case as well as in law, the Ld.CIT(A) ought not to have upheld disallowance of purchases to the extent of Rs. 67,76,525/- u/s 37 of the Act as non-genuine. It is, therefore, prayed that the disallowance of purchases to the extent of Rs 67,76,525/- upheld by the CIT(A) may kindly be deleted
Shri Samir Vora, the Ld. AR of the assessee submitted at the outset that no compliance could be made before the Ld. CIT(A) and, therefore, he had dismissed the appeal of the assessee without examining the issue on merits. He, therefore, requested that the assessee may be allowed another opportunity by setting aside the matter to the file of Ld. CIT(A).
Per contra, Shri Kamal Deep Singh, the Ld. SR-DR, supported the order of Ld. CIT(A).
We have considered the rival submissions. It is found that Ld. CIT(A) had allowed four opportunities to the assessee but no compliance was made except seeking an adjournment on the last date of hearing. It is also not the case that the assessee was not aware about the on-going proceedings before the Ld. CIT(A). The assessee has not given any explanation for non-compliance before the Ld. CIT(A). We, therefore, deem it proper to impose a cost of Rs.10,000/- on the assessee which should be deposited to the Prime Minister National Relief Fund within a period of 15 days from the date of receipt of this order. Subject to the payment of cost, the Ld. CIT(A) is directed to allow one more opportunity to the assessee to represent its matter and to file the submissions in respect of the grounds as taken in the first appeal. The assessee is also directed to make compliance before the Ld. CIT(A) in the course of set- aside proceeding. In case the assessee does not make compliance, the Ld. CIT(A) will have liberty to decide the matter on merits on the basis of evidence and material as available on record.
In the result, the appeal of the assessee is allowed for statistical purpose.
Order pronounced in the Court on 25/02/2026 at Ahmedabad.
Sd/- Sd/- (SUCHITRA KAMBLE) (NARENDRA PRASAD SINHA) Judicial Member Accountant Member Dated - 25th February, 2026 Neelesh True Copy आदेश आदेश क� आदेश आदेश क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : अ�ेिषत 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A) 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण / DR, ITAT, 6. गाड� फाईल /Guard file. आदेशानुसार/BY ORDER, आदेशानुसार आदेशानुसार आदेशानुसार