TALSHIBHAI KANJIBHAI NAROLA,DAMNAGAR vs. THE ITO WD 3(1)(4), RKT, AMRELI-RAJKOT
Facts
The assessee's case was reopened under Section 147 for AY 2018-19 due to information about bogus purchases amounting to Rs. 19,08,581. The Assessing Officer made an addition of this amount as unexplained money under Section 69A. The CIT(A) dismissed the assessee's appeal ex-parte.
Held
The Tribunal found that the CIT(A) did not decide the appeal as per Section 250(6) and that the assessee was not given a proper opportunity to present their case. Therefore, the Tribunal set aside the CIT(A)'s order and remitted the matter back for fresh adjudication, emphasizing the principles of natural justice.
Key Issues
The key legal issues were the validity of the ex-parte dismissal by the CIT(A) and whether the assessee was afforded a proper opportunity to be heard regarding the addition of unexplained money from bogus purchases.
Sections Cited
Section 147, Section 148, Section 144B, Section 69A, Section 115BBE, Section 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: DR. ARJUN LAL SAINI & DR. DINESH MOHAN SINHA
आदेश/ ORDER Per Dr. Dinesh Mohan Sinha, JM:
Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) – 2018-19, is directed against the order passed by the National Faceless Appeal Centre [(in short “NFAC/Ld. CIT(A)”] vide order dated 30.11.2025, which in turn assessment order passed by Income Tax Department/Assessing Officer under section 147 r.w.s. 144B of the Income Tax Act, 1961 (in short “the Act”), vide order dated 22.03.2023.
ITA No. 980/RJT/2025 Talsibhai K. Narola
Grounds of appeal raised by the assessee are as follows:
The learned Commissioner (Appeals), National Faceless Appeal Centre (NFAC), Delhi erred in dismissing the appeal of the Appellant ex-parte, by failing to appreciate that the Appellant was interested in pursuing the appeal filed before the CIT(A). 2. The learned Commissioner (Appeals), National Faceless Appeal Centre (NFAC), erred in upholding framing of assessment u/s 147 of the Act by the Assessment Unit, Income Tax Department, based on material found during search from third parties by failing to appreciate the same is bad in law and beyond jurisdiction. 3.The learned Commissioner (Appeals), National Faceless Appeal Centre (NFAC) erred confirming action of assessing officer in issuing notice u/s 148 of the Act in the light of reasons recorded and thus failed to appreciate that assessment framed u/s 147 r.w.s. 144B is bad in law. 4.The learned Commissioner (Appeals), National Faceless Appeal Center (NFAC), erred in confirming the addition of Rs. 19,08,451/- by way of unexplained money u/s 69A of the Act and in levying tax at rates u/s 115BBE of the Act. 5.Alternatively, the learned Commissioner (Appeals), National Faceless Appeal Center (NFAC), erred in upholding the action of assessing officer in making gross addition of Rs. 19,08,451/- and failed to appreciate that at best only profit element embedded in alleged transaction could be treated as income and not entire transaction. 6. The appellant craves leave to add, amend, alter and withdraw any ground of appeal anytime up to the hearing of this appeal.
Brief facts of the case are that the appellant is an individual and had filed return of income for the AY 2018-19 on 05.09.2018 by declaring total income of Rs.3,79,050/-. As per the information available with the department, the appellant was beneficiary of accommodation entries of bogus purchases amounting to Rs. 19,08,581/-. Accordingly, the appellant's case was reopened u/s 147 of the Act and notice u/s 148 of the Act was issued to the appellant to file return of income. In response to the notice, the appellant had filed return of income by declaring total income same as original return of income. Subsequently, statutory notices were issued to the appellant along with questionnaire. However, the appellant had only submitted partial reply for the queries raised by the AO. Accordingly, the AO completed the assessment u/s 147 r.w.s 144B of the Act vide order dated 22.03.2023 by making an addition of Rs. 19,08,581/- on account of bogus
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ITA No. 980/RJT/2025 Talsibhai K. Narola
purchases as unexplained money u/s 69A of the Act to total income of the appellant.
That the assessee filed an appeal against the order of the AO dated 22.03.2023 in the office of the Ld. CIT(A). That the Ld. CIT(A) dismissed the appeal with following observation:
“5.5 Hence, respectfully following the above mentioned judicial pronouncement and in view of the facts of the case, the appeal is hereby dismissed.”
That the assessee challenged the legality and validity of impugned order by moving of an appeal before this Tribunal.
During the course of hearing, the Ld. AR submitted of the assessee prayed for one more opportunity to be given to the assessee to represent the case before the lower authority.
On the contrary, the Ld. Sr. DR for the revenue relied on the order of the Ld. CIT(A) and not objected to the prayer of the Ld. AR of the assessee.
We have heard both the parties and perused the material available on record. The Ld. CIT(A) has issued several notices for hearing of the case. In response to the notices the appellant has submitted the response and the same is not proper no documents/ evidences submitted along with the response. We note that Ld. CIT(A) has not decided the appeal as per mandate of provisions u/s. 250(6) of the Act. However, we are of the view, that one more opportunity should be given to the assessee to plead his case before the Ld. CIT(A). It is settled law that principles of natural justice and fair play require that the affected party should be granted sufficient opportunity of being heard to contest his case. Keeping in view,
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ITA No. 980/RJT/2025 Talsibhai K. Narola
in the interest of justice, we set aside the order of the Ld. CIT(A) and remitted the matter back to the file of the Ld. CIT(A) for fresh adjudication after giving due opportunity to the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order is pronounced in the open court on 12/02/2026.
Sd/- Sd/- (Dr. Arjun Lal Saini) (Dr. Dinesh Mohan Sinha) Accountant Member Judicial Member Rajkot (True Copy) �दनांक/ Date: 12/02/2026 Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. Pr. CIT 5. DR/AR, ITAT, Rajkot 6. Guard File By order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Rajkot
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