Case Law Details
Ajjahar Ghaniwala Vs ITO (ITAT Ahmedabad)
In the case of Ajjahar Ghaniwala vs ITO, the Income Tax Appellate Tribunal (ITAT) Ahmedabad examined an appeal challenging an ex-parte addition of Rs. 36,01,500 under Section 69A for the assessment year 2017-18. The assessee, Ajjahar Ghaniwala, contended that both the Assessing Officer (AO) and the Commissioner of Income Tax (Appeals) (CIT(A)) had passed orders without granting a fair hearing. The addition was made based on unexplained cash deposits, but the assessee had failed to respond to multiple notices, resulting in an ex-parte decision by the CIT(A).
The ITAT found that the lack of cooperation from the assessee led to the ex-parte decision but noted the assessee’s plea to explain the source of the cash deposits and submit the necessary invoices and bills. Considering the fairness of allowing the assessee another opportunity to present the required documents, the ITAT directed the AO to initiate a de-novo assessment. The order effectively rescinded the Rs. 36,01,500 addition, with a clear instruction for the AO to conduct the reassessment in accordance with the law. This case highlights the importance of providing a fair opportunity for taxpayers to explain discrepancies and clarifies the procedures for handling such additions.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This is an appeal filed by the assessee against the order of the ld. Commissioner of Income Tax, CIT(A), National Faceless Appeal Centre, Delhi, in proceeding u/s. 250 vide order dated 30/11/2023 passed for the assessment year 2017-18.
2. The grounds of appeal taken by the assessee are as under:-
“1. The CIT(A) erred in law and in the facts of the case in passing ex-parte order u/s. 250 of the Act.
2. The CIT(A) erred in law and in the facts of the case in confirming the order of the A.O. in making addition of Rs. 36,01,500/-.”
3. Heard arguments of both the parties and perused the records available before us.
4. In this case, the assessment order has been passed on 16-12-2019 determining an addition of Rs. 36,01,500/- u/s. 69A of the Act. It is a fact on the record that the assessee has not complied to the notices issued by the Assessing Officer. Further, we also find that the assessee has not complied to the notices issued by the ld. CIT(A) also which led to passing of ex-parte order by ld. CIT(A). During the hearing, it was pleaded that given an opportunity, all the bills and invoices as well as the source of cash deposits would be explained to the Assessing Officer. The ld. D.R. fairly accepted to the proposal. Hence, keeping in view the facts, we direct the Assessing Officer to initiate assessment proceedings de-novo and pass an order in accordance with the provisions of the Income-tax Act.
5. In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 22-11-2024
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