Case Law Details
Hemantkumar Rajendrakumar Vs DCIT (ITAT Ahmedabad)
The ITAT Ahmedabad heard an appeal by Hemantkumar Rajendrakumar against the order of the Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), concerning Assessment Year 2013-14. The appeal challenged the ₹76,07,650 addition made by the Assessing Officer (AO) under Section 69A of the Income-tax Act, 1961, as unexplained money linked to transactions in shares of M/s. Stampede Capital Ltd. The CIT(A) had dismissed the appeal due to the assessee’s non-appearance and non-submission of documents. The assessee argued that the appeal was dismissed without adequate opportunity for hearing, despite having submitted substantial documentation before the AO. Additionally, there was a delay of 21 days in filing the appeal, attributed to the illness and hospitalization of the assessee’s Chartered Accountant. The tribunal condoned the delay based on an affidavit and medical records.
Upon reviewing the case, the ITAT observed that the CIT(A) had summarily dismissed the appeal without considering the merits or addressing the grounds raised by the assessee. The tribunal found that all three hearing notices were issued within a single month, limiting the taxpayer’s response time. Given these circumstances, the ITAT ruled that the appeal should be remanded for fresh adjudication, ensuring a proper hearing and consideration of evidence. The order was set aside, and the case was sent back to the CIT(A) for de novo proceedings. The appeal was allowed for statistical purposes, reinforcing the importance of due process and fair hearings in tax litigation.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal has been 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 vide order dated 07.08.2024 passed for A.Y. 2013-14.
2. The assessee has raised the following grounds of appeal:
“1. Ld. CIT(A) (NFAC) erred in law and on facts in dismissing the appeal filed by the appellant in absence of primary response to the appeal notices.
2. CIT(A) (NFAC) erred in law and on facts in confirming huge addition of Rs. 76,07,650/- made by AO as unexplained money u/s 69A of the Act.
3. CIT(A) (NFAC) erred in law and on facts dismissing the appeal without considering copy of ledger as well trading account of the broker submitted with bank account stating loss of Rs. 32.63 lacs suffered by the appellant.
4. CIT(A) (NFAC) erred in law and on facts in not prosecuting the appeal and refraining from discussion and decision on the grounds of appeal against the provisions of law and principles of Natural Justice.
5. Levy of interest u/s 234A & 234B of the Act is unjustified.
6. Initiation of penalty proceedings without specifying the section under which penalty is leviable is unjustified.”
3. We observe that there is a delay of 21 days in filing of the present appeal. The Counsel for the assessee submitted an Affidavit stating that he approached his Chartered Accountant, Shri Mehul Chalishajar for filing of appeal before ITAT, but due to his ill health and hospitalization the assessee’s Chartered Accountant was not in a position to approach the office of Shri S. Soparkar, Sr. Advocate for preparation of appeal. The assessee has submitted discharge certificate of the hospital of his Chartered Accountant, for the purposes of our records.
4. In light of the above, we are hereby condoning the delay of 21 days in filing of the present appeal.
5. The brief facts of the case are that during the course of assessment, addition on account of unexplained money under Section 69A of the Act was made on the ground that the assessee has taken unaccounted accommodation entries by undertaking transactions in shares of M/s. Stampede Capital Ltd.
6. In appeal, Ld. CIT(A) dismissed the appeal of the assessee on account of non-appearance and non-submissions of documents.
7. The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(A). Before us, the Counsel for the assessee submitted that Ld. CIT(A) has passed the appellate order, without giving adequate opportunity of hearing to the assessee and without dealing with any of the grounds of appeal raised by the assessee before him. The Counsel for the assessee submitted that Ld. CIT(A) issued three notices of hearing dated 25.06.2024, 11.07.2024 and 23.07.2024 i.e. all notices were issued within a gap of one month and thereafter, summarily dismissed the appeal of the assessee, without dealing with any of the grounds of appeal raised by the This is despite the fact that the assesse had submitted substantial details before the Assessing Officer running into almost 100 pages, which were completely omitted to be considered by Ld. CIT(A) at the time of passing of the order. Accordingly, it was requested that in the interest of justice, the matter may be restored to the file of Ld. CIT(A) for de-novo consideration after giving due opportunity of hearing to the assessee.
8. On going through the contents of the order, we observe that Ld. CIT(A) has summarily dismissed the appeal of the assessee with the following observations:
“5.2 Further, the appellant has failed to submit any substantial evidence to overturn the decision made by the AO in the impugned order. Therefore, it has been construed that the appellant is not interested in prosecuting the appeal. In the instant case, I am refraining from discussion and decision on the Grounds of appeal on merits. The Grounds of appeal are dismissed herewith for non- prosecution.”
9. Accordingly, looking into the contents of the order passed by Ld. CIT(A), wherein, he has specifically refused to deal with any of the grounds raised by the assessee and also the fact that all notices of hearing were issued to the assessee within a period of one month only, we are of the view that in the interest of justice, the matter may be restored to the file of CIT(A) for de-novo consideration, after giving due opportunity of hearing to the assessee.
10. In the result, the appeal of the assessee is allowed for statistical purposes.
This Order pronounced in Open Court on 27/12/2024
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