AKHTAR HUSSAIN,BASTI V. INCOME TAX OFFICER, BASTI

ITA 615/LKW/2025

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The case involves Akhtar Hussain, the appellant, who contested the assessment of his income for the year 2016-17, which was determined by the Income Tax Officer, Basti, at Rs.2,36,52,638. The appellant raised multiple grounds including the incorrect issuance of notices, violation of natural justice, and improper assessment under sections 147 and 144 of the Income Tax Act. The Tribunal noted that the notices were sent to an incorrect email address, preventing the appellant from receiving proper intimation and effectively representing himself. The Tribunal also considered the appellant's claim of being a salaried employee with a monthly income of Rs. 15,000, questioning the source of the alleged deposits in his bank account.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840939 (ITAT-LUCKNOW)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 26-08-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.R.N. SHUKLA
• Assessee Lawyers: HARSHIT GOEL
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice; Initiation of penalty proceedings
• Section: 147; 148; 144; 234B

Judgement Text

"आयकर अपीलीय अधिकरण ‘बी’ न्यायपीठ, लखनऊ। IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “B”, LUCKNOW श्री क ुल भारत, उपाध्यक्ष एवं श्री अनादि नाथ मिश्रा, लेखा सिस्य क े सिछ BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER आयकर अपील सं/ ITA No.615/LKW/2025 ननिाारण वर्ा/ Assessment Year: 2016-17 Akhtar Hussain C/o AM Tripathi & Associates ICICI Prudential Life Insurance Building, 1st Floor, Kaante Road, Basti-272002. v. Income Tax Officer, ITO Basti Civil Lines, Basti-272001. PAN:ADFPH4389H अपीलाथी/(Appellant) प्रत्यथी/(Respondent) अपीलाथी कक और से/Appellant by: Shri Harshit Goel, Advocate प्रत्यथी कक और से /Respondent by: Shri R. R. N. Shukla, Addl. CIT(DR) सुनवाई कक तारीख / Date of hearing: 18 02 2026 घोर्णा कक तारीख/ Date of pronouncement: 24 02 2026 O R D E R PER KUL BHARAT, VICE PRESIDENT.: This appeal, by the assessee, is directed against the order of the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi dated 20.06.2025 pertaining to the assessment year 2016-17. The assessee has raised the following grounds of appeal: - “1. That the Ld. CIT(A)erred on facts and in law in confirming the action of Ld. Income tax officer, Basti (‘assessing officer’) to assess income of the appellant for the relevant assessment year at Rs.2,36,52,638. Re: Validity of the assessment order: Printed from counselvise.com ITA No.615/LKW/2025 Page 2 of 4 2. That the Ld. CIT(A) erred on facts and in law in confirming the action of assessing officer of passing assessment order under section 147 read with section 144, without appreciating that there assessment proceedings, including issuance of notice under section 148 dated 18.03.2023 and passing of assessment order dated 07.03.2024,have been conducted by the jurisdictional assessing officer, in contravention of the provisions of section 151A of the Act. Re: Violation of principles of natural justice; 3. That the Ld. CIT(A) erred on the facts and circumstances of the case, by sending hearing notices under section 250 of the Act to an incorrect email address, despite the correct email address having been duly provided in Form 35 and also updated in the profile section on the e-filing portal. 4. That the Ld. CIT(A) erred on the facts and circumstances of the case and in law in confirming the action of assessing officer of passing assessment order under section 147 read with section 144 of the Act, without affording any opportunity of being heard to the appellant including personal hearing, and in gross violation of principles of natural justice. Re: Addition of Rs.236,52,638 as unexplained money under section 69A of the Act: 5. Thai the Ld. CIT(A) erred on the facts and circumstances of the case and in law in confirming the action of the assessing officer to assess income of the appellant Rs2,36,52,640, by treating the same as unexplained money under section 69A of the Act 6. That the Ld. CIT(A) erred on the facts and circumstances of the case in confirming the action! of the assessing officer without appreciating the fact that the appellant did not own the alleged money and merely acted as a facilitator for payment of taxes and charges to the Regional Transport Office (RTO) on behalf of customers purchasing motorcycles. Re: Other issues: 7. That the Ld. CIT(A) failed to adjudicate the ground raised by the appellant challenging the direction of the assessing officer for initiation of penalty proceedings under the existing section 271AAC of the Act. 8. That the assessing officer erred on facts and in law in levying interest under sections 234A and 234B of the Act. 9. That the assessing officer erred on facts and in law in initiating penalty proceedings under sections 272A(l)(d) and 27IF of the Act.” 2. Apropos the grounds of appeal, the Ld. Counsel for the assessee, at the outset, submitted that there was no effective representation on behalf of the assessee before the lower authorities. Further, he pointed out that the Ld. CIT(A) issued notice at an incorrect email address, and consequently, the assessee did not receive proper intimation of the appellate Printed from counselvise.com ITA No.615/LKW/2025 Page 3 of 4 proceedings. He further submitted that the assessee is a small salaried employee earning Rs. 15,000/- per month and that the amount deposited in the bank account does not belong to him. He further contended that no effective and reasonable opportunity of being heard was granted to the assessee. 3. On the other hand, the Ld. Departmental Representative for the Revenue opposed the submissions and supported the orders of the lower authorities. 4. We have heard the Ld. Representatives of both parties and perused the material available on records. It is not in dispute that the notice issued by the Ld. CIT(A) was sent to an incorrect email address, different from the email address furnished by the assessee. Consequently, the assessee could neither appear nor file any explanation before the appellate authority. It is further observed that the assessee failed to appear before the Assessing Officer, and the impugned addition was made ex parte, on the basis of cash deposits reflected in the bank account of the assessee. Having considered the fact that the assessee is a salaried employee earning Rs. 15,000/- per month, such a huge amount could not have been deposited requires proper examination. Therefore, we are of the considered view that an opportunity should be granted to the assessee to represent his case and explain the source of such cash deposits in his account. Therefore, the impugned order passed by the Ld. CIT(A) is hereby set aside, and the assessment is restored to the file of the Assessing Officer for making de novo assessment in accordance with law. Needless to say that the assessee would provide all the information which is relevant and necessary for adjudication of Printed from counselvise.com ITA No.615/LKW/2025 Page 4 of 4 the matter. Grounds of appeal of the assessee are allowed for statistical purposes. 5. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 24/02/2026. Sd/- [अनादि नाथ मिश्रा] Sd/- [क ुल भारत] [ANADEE NATH MISSHRA] [KUL BHARAT] लेखा सिस्य/ACCOUNTANT MEMBER उपाध्यक्ष/VICE PRESIDENT DATED: 24/02/2026 Vijay Pal Singh, (Sr. PS) Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DR 5. Guard File //True Copy// Printed from counselvise.com "