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Facts
The assessee did not file his income return for AY 2018-19. His case was reopened, and a notice under section 148 was issued regarding cash deposits. The assessee filed a return declaring income under section 44AD, but the AO added the entire cash deposit as unexplained income. The CIT(A) dismissed the appeal ex-parte for non-compliance.
Held
The Tribunal noted that the CIT(A) erred in dismissing the appeal without adjudicating on merits and that an appellate authority must dispose of appeals on merits even in cases of non-compliance. The Tribunal condoned the delay in filing the appeal.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal ex-parte for non-compliance without adjudicating on merits, and if the delay in filing the appeal should be condoned.
Sections Cited
139(1), 147, 148, 250, 44AD
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “PATNA BENCH”, PATNA
Gaurab Kumar, Krishna Medical Agency, Main Road, Puraini Bazar, Puraini, Madhepura (Bihar) - 852116 [PAN: DXDPK2693L] ..…...…………….... Appellant vs. ITO Ward 3(4), Saharsa Koshi Chowk Gautam Nagar, Saharsa (Bihar) - 852201 ..…...…………….... Respondent Appearances by: Assessee represented by : None (adjournment petition filed) Department represented by : Shri Manab Adak, JCIT Date of concluding the hearing : 14.01.2026 Date of pronouncing the order : 19.01.2026 O R D E R
PER SONJOY SARMA, JUDICIAL MEMBER
This appeal arises from order dated 27.04.2025, passed u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereafter “the Ld. CIT(A)].
Brief facts of the case are that the assessee is an individual who did not file his return of income under section 139(1) of the Income-tax Act, 1961 for the assessment year 2018–19. Subsequently, the case was reopened under section 147 of the Act and notice under section 148 was issued on the basis of information regarding cash deposits amounting to Gaurab Kumar ₹1,29,16,548 in a bank account maintained with Central Bank of India. In response to the notice under section 148 of the act was issued to the assessee and assessee filed his return of income declaring income from business and profession at ₹10,33,071, computed at the rate of 8% under section 44AD of the Act on total receipts of ₹1,29,13,383. The Assessing Officer was not satisfied with the income so declared and proceeded to make an addition of ₹1,29,16,548 by treating the entire cash deposits as unexplained, thereby assessing the total income of the assessee at ₹1,39,49,619.
The assessee preferred an appeal before the CIT(A). However, the CIT(A) dismissed the appeal ex parte for non-compliance, without adjudicating the issues on merits.
Aggrieved by the order of the CIT(A), the assessee is in appeal before the Tribunal.
In the instant case, there is a delay of 100 days in filing the present appeal. In this connection, the assessee has filed an application seeking condonation of the said delay, explaining the reasons for late filing of the appeal.
After considering the contents of the condonation application and being satisfied that the assessee was prevented by sufficient cause from filing the appeal within the prescribed time, we condone the delay of 100 days and proceed to adjudicate the appeal on merits.
At the time of hearing we noticed that the CIT(A) erred in dismissing the appeal merely on account of non-compliance, without examining the merits of the case. It was contended that the assessee did not get adequate
Gaurab Kumar opportunity to represent his case. The assessee’s contention is that one more opportunity be granted to the assessee and the matter be restored to the file of the Assessing Officer for fresh adjudication.
On the other hand, the learned DR supported the orders of the authorities below.
We have heard the matter and perused the material available on record. It is evident that the appeal before the Ld. CIT(A) was dismissed ex parte due to non-compliance, without adjudicating the grounds raised by the assessee on merits. It is a settled principle of law that the appellate authority is required to dispose of the appeal on merits, even in cases of non-compliance. In the present case, the assessee has declared income under section 44AD of the Act, whereas the Assessing Officer has made addition of the entire cash deposits without examining the applicability of presumptive taxation provisions.
In the interest of justice and fair play, we deem it appropriate to restore the matter to the file of the Assessing Officer for fresh examination. The Assessing Officer is directed to re-adjudicate the issue after providing reasonable opportunity of being heard to the assessee. The assessee is also directed to fully comply with the notices and cooperate in the assessment proceedings without any further default.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on 19.01.2026