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Facts
The assessee purchased an immovable property, and the stamp duty valuation of Rs. 33,27,500/- was higher than the consideration paid. The Assessing Officer made an addition of Rs. 13,27,500/- under section 56(2)(vii) of the Income Tax Act as undisclosed income. The CIT(A) dismissed the assessee's appeal ex-parte due to non-furnishing of supporting evidence despite multiple opportunities.
Held
The Income Tax Appellate Tribunal (ITAT) observed that the CIT(A) dismissed the appeal ex-parte without delving into the merits of the case. To ensure natural justice, the ITAT remitted the matter back to the CIT(A) with a direction to dispose of the appeal afresh on merit, cautioning the assessee to cooperate with the proceedings.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal ex-parte without considering the merits of the addition made under section 56(2)(vii) of the Income Tax Act.
Sections Cited
143(1), 148, 142(1), 56(2)(vii)
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Income Tax Appellate Tribunal, KOLKATA-RANCHI ‘e-COURT’, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ) & Shri Ratnesh Nandan Sahay
Per Duvvuru RL Reddy, Vice-President (KZ):- The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 19th February, 2024 passed for Assessment Year 2017-18.
(A.Y. 2017-2018) Subir Mandal 2. The ld. Authorized Representative Shri Akshay Ringasia submitted a letter dated 21.07.2025 before the Bench praying for adjournment of three weeks in the matter. We have perused the record in the Open Court and found that the ld. CIT(Appeals) passed the order ex-parte without going into the merit of the case. The ld. CIT(Appeals) passed the order ex-parte mainly on the ground that the assessee was provided several opportunities of hearing and called for written submissions and documentary evidences in support of his ground of appeal raised, but the assessee did not avail any of the opportunities of being heard and not furnished any supporting evidence in support of his claim. Therefore, we do not deem it appropriate to grant any adjournment to the assesseee. Hence, the application for adjournment is rejected.
Brief facts of the case are that the appellant-assessee is an individual, who filed his return of income showing total income of Rs.3,48,260/- on 27.07.2017 for AY 2017-18, which has been processed under section 143(1) on 19.10.2017. The assessee has shown income from other sources at Rs.42,587/-. The case of the assessee was selected for reassessment proceeding under section 148. However, notice u/s 148 and subsequent notices under section 142(1) could not be acted upon by the assessee. The assessee purchased an immovable property jointly owned along with his wife. The total consideration jointly paid was Rs.20,00,000/- where the assessee paid only a portion of consideration and the rest was paid by his wife. Stamp valuing authority valued it at Rs.33,27,500/-. Subsequently it was (A.Y. 2017-2018) Subir Mandal brought by the authority that the assesese has received the said immovable property for an inadequate consideration and also the differential amount of Rs.13,27,500/- deemed to be the income of the assessee. Since no response from the side of assessee, the ld. Assessing Officer treated Rs.13,27,500/- as undisclosed income and added to the income of the assessee from other sources u/s 56(2)(vii) of the Act. On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals).
The ld. CIT(Appeals) dismissed the appeal of the assessee ex- parte as the assessee failed to produce satisfactory documentary evidences in support of his claim inspite of sufficient opportunities given.
On being aggrieved, the assessee preferred an appeal before the ITAT.
It was the submission of the ld. Counsel for the assessee that the ld. CIT(Appeals) simply upholding the order of ld. Assessing Officer and without going into the merit of the case dismissed the appeal. Ld. Counsel pleaded to set aside the order of ld. CIT(Appeals).
It was the submission of the ld. Departmental Representative that sufficient opportunity was being provided to the assessee. Therefore, the ld. CIT(Appeals) has no other option except dismissing the appeal and he pleaded to uphold the order passed by the ld. CIT(Appeals).
We have heard both the sides and perused the material available on record. The ld. CIT(Appeals) dismissed the appeal of the assessee ex-parte without going into the merit of the case. By considering the totality of the facts and circumstances of the case, and in order to ensure the principle of natural justice, we are of the view that it is a fit case to provide one more opportunity to the assessee. Therefore, we remit the matter back to the file of ld. CIT(Appeals) with a direction to dispose of the appeal without any inference on the observations of earlier order passed by him and to decide it afresh on merit. At the same breath, we also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. CIT(Appeals) failing which the Ld. CIT(Appeals) shall be at liberty to pass appropriate order in accordance with law and merits of the case, based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 25/08/2025.