RITESH DATTA,INDORE vs. ITO 2(5), INDORE

This appeal by the Assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) Delhi dated 09.11.2023 for A.Y. 2012-13. The assessee has raised following grounds of appeal:

“1.The Ld. AO was not justified in passing the order, which is bad- in-law, void ab initio, barred by limitation, illegal, contrary to the facts and circumstances of the case, liable to be annulled.

ITANo.506/Ind/2023 Ritesh Datta 2.The Ld. CIT(A) was not justified in confirming the order, which is bad-in-law, void ab initio, barred by limitation, illegal, contrary to the facts and circumstances of the case, liable to be annulled. 3.The ld. CIT(A) was not justified in giving a fair and meaningful opportunity and dismissing the appeal ex-parte for non-prosecution, and not on merits. 4.The Ld. CIT(A) was not justified in confirming the addition of Rs. 32,81,499/- as unexplained investment . 5.The appellant Carves to leave add, ammend or modify any of the grounds of appeal

.”

2. Ld. AR of the assessee has submitted that the CIT(A) dismissed the appeal of the assessee while passing the impugned order ex-parte and confirmed the additions made by the AO on account of unexplained investment made in purchase of shares in the assessment order passed u/s 144 r.w. section 147 of the Act. Thus, Ld. AR has submitted that the addition made by the AO without considering the explanation of source of investment made by the assessee. Further the Ld. AR has submitted that the assessment was reopened by the AO due to non-payment of tax on the income declared under IDS-2016. Thus, ld. AR has submitted that the assesse may be granted one more opportunity to present its case and explain the source of investment in the shares.

3. On the other hand Ld. DR has submitted that initially the assessee declared at Rs.32,81,499/- in IDS-2016 for investment made in shares of Turbo Tech Engineering Ltd. however, the assessee failed to pay specific tax, surcharge and penalty in respect of the said declaration. Consequently the AO reopened the ITANo.506/Ind/2023 Ritesh Datta assessment and passed the order u/s 144 r.w. section 147 when there was no response on behalf of the assesse to the notice issued by the AO. Ld. DR further submitted that even the CIT(A) has issued four notices of hearing but there was no response on behalf of the assesse. Hence, the addition made by the AO has been confirmed by the CIT(A) when there was no explanation on behalf of the assessee.

4. Having considered rival submission as well as relevant material on record at the outset, we note that the AO has passed ex-parte order u/s 144 r.w. section 147 because the assesse did not respond to the notice issued by the AO u/s 148 as well as section 142(1) of the Act. The AO has made an addition on account of unexplained investment in shares of Turbo Tech Engineering Ltd which was declared by the assessee in IDS-2016 but due to non- payment of the due tax the declaration of the assessee was rejected by the competent authority. The AO has made the addition solely on the basis that the assessee has declared this income in IDS- 2016 and no inquiry was conducted by the AO to reach to the conclusion that the said investments was from unexplained sources. The assessee challenged the order of the AO before the CIT(A) but due to non-appearance and participation on behalf of the assessee in the proceeding before the CIT(A) the appeal of the assessee was dismissed and the addition made by the AO was confirmed. The assessee raised specific issue regarding the validity of the assessment order on the ground of limitation and without affording opportunity of hearing to the assessee however, the CIT(A) Page 3 of 4

ITANo.506/Ind/2023 Ritesh Datta has not decided this issued/objections while passing a non- speaking order. Accordingly in the facts and circumstances of the case and in the interest of justice the impugned order of the CIT(A) is set aside and matters is remanded to the record of the AO for fresh adjudication after giving one more opportunity of hearing to the assessee.

Order pronounced in the open court 20 .03.2024.