Ranjitsinh Kanubhai Rathod Vs ITO (ITAT Ahmedabad)
Penny-Stock Reassessments- Jurisdictional Objections Fail, But Natural Justice Wins—Cases Sent Back to CIT(A)
Assessee faced three reassessments based on information that he allegedly earned bogus LTCG from penny stock (Kushal Ltd). AO issued notices u/s 148 (31.03.2021; 31.03.2022; 23.03.2023) & completed reassessments u/s 147 r.w.s.144/144B for all three years, making additions u/s 69A for unexplained LTCG & u/s 69C @ 2% for alleged commission on accommodation entries. CIT(A)-NFAC dismissed all appeals ex-parte for non-prosecution without examining merits or evidences.
Before Tribunal, Assessee argued (i) notices u/s 148 were invalid due to 153C applicability; (ii) notices for AYs 2018-19 & 2019-20 violated Notification No.18/2022 requiring faceless automated allocation; (iii) CIT(A) failed to consider filed submissions.
Tribunal rejected jurisdictional grounds—observing in AY 2017-18 that reopening was based on independent reasons not dependent on 153C; same reasoning applied to AYs 2018-19 & 2019-20. However, on merits Tribunal found CIT(A) passed non-speaking ex-parte orders & ignored documentary evidence. For all three years Tribunal remanded matters to CIT(A) for de-novo adjudication after proper verification & after providing adequate opportunity to Assessee. Appeals partly allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
These three appeals are filed by the assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi on separate orders dated 06.09.2024 and 15.04.2024 for A.Ys. 2017-18 to 2019-20.
