Mohd. Azgar Ali Vs ITO (ITAT Hyderabad)
Assessee, an individual from Nalgonda, did not file a return of income for A.Y. 2017-18. Information with the department indicated cash deposits of ₹60,04,600 in his Andhra Bank account. Based on this, the AO reopened the case u/s 147 and issued notice u/s 148 on 21.03.2022. Despite multiple notices u/s 142(1) and a final show cause notice u/s 144, the Assessee did not respond. The AO therefore passed an ex-parte reassessment order u/s 147 r.w.s. 144 on 08.01.2025, adding ₹60,04,600 u/s 69A as unexplained money.
Before the CIT(A), the Assessee
- Challenged the validity of reassessment under Sections 148A(b) & 148A(d), citing lack of compliance with the faceless procedure under Section 151A.
- Claimed that the cash deposits were sourced from earlier withdrawals from the same account
CIT(A), NFAC, noted that the assessment was completed without opportunity of hearing, and hence set aside the assessment to the AO for fresh adjudication after providing the Assessee a fair chance to explain his case
Assessee’s Argument before ITAT
Assessee contended that:
- The notice u/s 148 issued by the Jurisdictional AO (non-faceless) was invalid under the new faceless reassessment regime u/s 151A, as held in ITO v. Prakash Pandurang Patil [2025] 178 Taxmann.com 8 (SC).
- Since the very initiation of reassessment was void, the CIT(A) should have annulled the assessment, instead of remanding the case
Revenue’s Stand
