AAPKA FAISLA GOLD PALACE,SHAHDOL vs. ACIT CENTRAL CIRCLE,, JABALPUR

during the appellate proceedings.

6. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal without appreciating that application of section 115BBE on the surrendered stock is to be treated as business income and it is settled issue and various judicial pronouncements wherein it was clearly held that income surrendered during survey has to be treated under Business Head

7. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal on the ground that appellant failed to provide any satisfactory explanation regarding the source of investment in the excess stock surrendered during the survey proceedings whereas the amount was duly recorded in the books of accounts and excess stock cannot be treated under the purview of section 115BBE of the IT Act.

8. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal without appreciating the fact that provision of section 69B of the act is not applicable on account of stock and appellant has surrendered the excess stock and not for investment and it was duly recorded in the books of the account.

9. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal without appreciating that the assessing officer erred in treating the excess stock as income from other sources without appreciating that such stock was duly recorded in the books of accounts after survey and including the same in profit and loss account, the return was filed.

10. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal without appreciating that the assessing officer erred in applying the provisions of section 69B of the Act without appreciating that the appellant has duly offered the explanation and such explanation was duly accepted by the AO by accepting returned income.

11. The learned Commissioner of Income tax (Appeal) Raipur - 3 was not justified in dismissing the appeal without appreciating that the assessing officer erred in applying section 115BBE on the surrendered amount by ignoring the various judicial pronouncements wherein it was clearly held that income surrendered during survey has to be treated under Business Head.

2. The assessee is a partnership firm and engaged in trading of Gold/Silver/Diamond and other precious metals jewellery. The assessee had filed its return of income declaring total income of Rs.1,35,17,270/- for the A.Y. 2019-20. A survey u/s 133A of the Income Tax Act, 1961 (“Act”, for short) was carried out by the Revenue on 18.02.2019 at the business premises of the assessee. Consequently, the case was selected for scrutiny through Compulsory Manual Scrutiny Selection. A notice u/s 143(2) of the Act was issued on 26.09.2020 which was duly served upon the assessee. However, the notices u/s 142(1) of the Act were issued on various dates through ITBA portal. In response thereto, the assessee had filed replies to the queries raised by the Assessing Authority. After considering the replies, the Assessing Officer noted that during the course of survey excess stock was found and a sum of Rs.1,05,15,579/- was surrendered in this regard. The Assessing Officer opined that on surrendered amount the assessee ought to have paid taxes as per u/s 115BBE of the Act. Therefore, the Assessing Officer treated the excess stock of Rs.1,05,15,579/- as the investment not fully recorded in the books of account u/s 69B of the Act. Aggrieved by this, the assessee preferred appeal before the Ld. CIT(A). Before the Ld. CIT(A), there was no representation on behalf of the assessee. Therefore, he proceeded to pass an ex parte order

3. Apropos to the grounds of appeal, the Ld. Counsel for the assessee has raised multiple grounds including the grounds against validity of the impugned order. He contended that the Ld. CIT(A) failed to consider the submissions of the assessee and utter disregard to the finding precedence proceeded to pass impugned ex parte order. Therefore, he prayed that the matter may be remanded back and the authorities below may be directed to provide adequate opportunity of being heard. He submitted that the assessee would co-operate in the proceedings.

4. On the other hand, the Ld. Departmental Representative (DR) opposed the submission of the assessee and supported the orders of the lower authorities. He contended that there is no dispute with regard to the fact that the assessee himself had surrendered the amount during the survey action. Therefore, Ld DR contended that the finding of the lower authorities may be sustained and appeal be dismissed.

5. Heard the Ld. Representatives of the parties and perused the materials available on record. It is seen from the impugned order that the Ld. CIT(A) has dismissed the appeal ex parte to the assessee. It is contended on behalf of the assessee that before the Ld. CIT(A) certain submissions were made regarding the reasons for difference of stock. However, the Ld. CIT(A) without considering the same and adverting to the submissions of the assessee passed an ex parte order. Therefore, looking to the totality of the facts, we deem expedient to sub-serve the interest Page 5 of 6 of principles of natural justice set aside the impugned order and restore the grounds to the file of the Ld. CIT(A) to decide it afresh by way of speaking order, after giving adequate opportunity of hearing to the assessee. Hence, the impugned order is hereby set aside and the Ld. CIT(A) is directed to decide the grounds of appeal afresh, after giving adequate opportunity of being heard to the assessee. The assessee is hereby directed not to seek adjournment unless there is any serious exigency and would co- operate in the proceedings. The grounds raised in this appeal are allowed for statistical purposes.

Order pronounced in the open Court on 28/08/2025.