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Facts
The assessee appealed an ex-parte order from the CIT(A) which had confirmed an addition of Rs. 3,65,84,053/- as business income based on an ex-parte reassessment order under section 147 r.w.s. 144. The appeal to the Tribunal was delayed by 56 days due to the previous consultant, and the CIT(A) had dismissed the assessee's appeal for non-prosecution after denying an adjournment.
Held
The Tribunal condoned the 56-day delay in filing the appeal. It set aside the ex-parte order of the CIT(A) and remanded the matter back to the CIT(A) with directions to first adjudicate the legal ground concerning the validity of the reassessment notice under section 148, after providing the assessee a fresh opportunity of hearing.
Key Issues
1. Validity of the reassessment notice issued under section 148 of the Income Tax Act. 2. Correctness of confirming the entire contract receipts as business income, especially the need for fair and reasonable estimation in a best judgment assessment under section 144.
Sections Cited
147, 144, 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH
Before: Smt. Annapurna Gupta & Shri T. R. Senthil Kumar
Date of hearing : 13-01-2026 Date of pronouncement : 21-01-2026 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-
This appeal is filed by the Assessee as against the exparte appellate order dated 29-07-2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the exparte reassessment order under section 147 r.w.s. 144 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2015-16.
The registry has noted that there is a delay of 56 days in filing the above appeal. The Partner of the assessee firm filed a Notarized Affidavit stating that the appellate hearing notices were issued to the erstwhile Consultant who has not informed the hearing dates which has resulted in passing exparte order. Later she appointed a new Consultant and filed the above appeal with the delay of 56 days and requested to condone the delay.
We have perused the appellate order, Ld. CIT(A) had given three opportunities of hearing on 02-05-2025, 22-05-2025 and 03-06-2025. On the third hearing, the assessee requested for adjournment of 15 days, which was not acceded by Ld. CIT(A) and dismissed the appeal for non-prosecution. Thus we hereby condone the delay of 56 days in filing the appeal.
The Grounds of Appeal raised by the assessee are as follows:
The notice u/s 148 of the I.T. Act dated 31-03-2021 is void and invalid in law and hence, the same is liable to be quashed.
2. Ld. CIT(A) erred in law and on facts in confirming the addition made by the AO of Rs. 3,65,84,053/- as business income.
3. Both Ld. CIT(A) and the AO erred in law and on facts in not appreciating that against the contract receipts of Rs. 3,65,84,053/, appellant has incurred contract expenditure of Rs. 3,58,30,607/- which is evident from the bank account statements and it has also incurred other indirect expenses in course of the business and thus, the contract receipts of Rs. 3,65,84,053/- does not represent appellant's business income in its entirety.
4. Ld. AO's act of treating entire contract receipts of Rs.3,65,84,053/- as business Income and Ld. CIT(A)'s confirming of such action of the AO are not in line with the settled law that in case of best judgement assessment u/s 144 of the Act also, the AO needs to make fair and reasonable estimate of the income of assessee.
The Appellant reserves the right to add, alter, amend and withdraw any of the above grounds of appeal.
5. The assessee also raised Legal ground on reopening of assessment apart from the merits of the case. Since the appellate order being an exparte order, we deem it fit to set-aside the matter to the file of Ld. CIT(A) to decide first the Legal ground raised by the assessee on reopening of assessment by giving one more opportunity of hearing to the assessee by sending Physical notice of hearing to the assessee and email id caviharsoni@gmail.com and Mobile No. 8980171867. Needless to say the assessee should make use of this final opportunity and place on record all relevant materials before Ld. CIT(A) to pass order on jurisdiction and merits of the case.
In the result, the appeal filed by the Assessee is treated as allowed for statistical purpose.