AMARJIT SINGH,LUDHIANA V. INCOME TAX OFFICER,WARD 6(1) LUDHIANA, LUDHIANA

ITA 1171/CHANDI/2024

AI Insights

This case involves an appeal by Shri Amarjit Singh against the order of the CIT(A), NFAC, Delhi, which pertained to the Assessment Year 2017-18. The primary issues raised included the improper dismissal of the appeal for non-prosecution without adequate notice, the invalid initiation of reassessment proceedings under sections 148 and 151 of the Income Tax Act, and the erroneous addition of income under 'Short Term Capital Gain'. The Tribunal found that the CIT(A) had erred in dismissing the appeal without proper notice and had not addressed the core issues raised, such as the validity of the reassessment and the additions made.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712327 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2017-2018
• Other Referred Cases: Antikumar H. Shah vs. ACIT, CIT vs. Multiplan India Pvt. Ltd. [38 ITD 320 (Del)]
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN
• Assessee Lawyers: PANKAJ BHALLA; C.A
• Keywords: Set aside; Opportunity of being heard; Reassessment proceedings; Principle of natural justice; Competent authority; Initiation of penalty proceedings; Audi alteram partem
• Section: 147; 148; 144

Judgement Text

"आयकर अपीलीय अिधकरण,चǷीगढ़ Ɋायपीठ “ए” , चǷीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE ŵी लिलत क ुमार, Ɋाियक सद˟ एवं ŵी क ृणवȶ सहाय, लेखा सद˟ BEFORE: SHRI. LALIET KUMAR, JM & SHRI. KRINWANT SAHAY, AM आयकर अपील सं./ ITA No. 1171 /Chd/ 2024 िनधाŊरण वषŊ / Assessment Year : 2017-18 Shri Amarjit Singh C/o V V Bhalla & Company SCF-39, Rishi Nagar Main Market, Adjoining Subway, Ludhiana-141001, Punjab बनाम The ITO Ward 6(1) Ludhiana ˕ायी लेखा सं./PAN NO: ABTPS8558B अपीलाथŎ/Appellant ŮȑथŎ/Respondent िनधाŊįरती की ओर से/Assessee by : Shri Pankaj Bhalla, C.A राजˢ की ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 17/07/2025 उदघोषणा की तारीख/Date of Pronouncement : 29/07/2025 आदेश/Order PER KRINWANT SAHAY, AM: This is an appeal filed by the Assessee against the order of the Ld. CIT(A), NFAC, Delhi dt. 24/10/2024 pertaining to Assessment Year 2017-18. 2. In the present appeal Assessee has raised the following grounds: 1 That The Ld. C.I.T.(A), NFAC, Delhi has wrongly passed the order u/s 250(6) of the Income Tax Act, 1961 against law and facts of the case. 2 That the Ld. C.I.T.(A), NFAC, Delhi erred in law & facts to dismiss the appeal for non-attending the appeal proceedings without serving any notice u/s 250 of the Act on the duly designated email on the Income Tax Portal and also on the email incorporated in Form 35. Printed from counselvise.com 2 3 That the Ld. C.I.T.(A), NFAC, Delhi has failed to appreciate that the Ld. AO erred in law in opening assessment proceedings u/s 148 r.w.s 148A of the Act. 4. That the L.d. C.I.T.(A), NFAC, Delhi has failed to appreciate that the notice u/s 148 is in the contravention to section 151 of the Income Tax Act, 1961. 5 That the L.d. C.I.T. (A), NFAC, Delhi has failed to appreciate that the Approval taken u/s 151 of the Income Tax Act, 1961 is illegal and invalid since it has been obtained from wrong authority. 6. That the Ld. C.I.T.(A), NFAC, Delhi has failed to appreciate that the L.d. AO erred in law & facts in making addition under the head \"Short Term Capital Gain\" for Rs.1,77,41,400/- 7. That the Ld. C.1.T.(A), NFAC, Delhi has failed to appreciate that the L.d. AO erred in law & facts in passing order u/s 147 r.w.s 144 without giving proper opportunity of being heard in contravention to the principles of natural justice i.e. audi alteram partem. 8. That the Ld. C.I.T.(A), NFAC, Delhi has failed to appreciate that the Ld. AO erred in law & facts in initiating penalty proceeding u/s 270A and 272A(1)(d) of the Act, without any base & reasons thereof. 9. That the Appellant craves, leave to vary, alter or add any grounds of appeal before the appeal is finally heard or disposed off. 3. Briefly, the facts of the case are that the appeal was filed on 14th July 2023 by Shri Amrit Singh for A.Y. 2017-18 against the order passed by CIT(A), NFAC, Delhi under section 250(6) of the Income Tax Act, 1961. The appeal, filed with a delay of 34 days, raised several issues including dismissal by Ld. CIT(A) without proper notice, invalid initiation of reassessment proceedings under section 148 read with section 144A, and defective approval under section 151. The assessee also disputed the addition of Rs Printed from counselvise.com 3 17,41,400/- under the head “Short Term Capital Gain” and the initiation of penalty proceedings under sections 270A and 272A(1)(d). The Ld. AO had initiated reassessment proceedings under section 148 read with section 144A alleging escapement of income and made the aforesaid addition, which was also followed by initiation of penalty proceedings under the mentioned sections. The assessee objected to the reassessment proceedings on grounds of invalid approval under section 151, lack of opportunity of being heard, and non-adherence to the procedure under sections 147, 144, and 144B. 4. Against the order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A). The Ld. CIT(A) dismissed the appeal on the ground of non-prosecution, noting that no submissions were filed by the assessee despite having been granted sufficient opportunity. Relying on judicial precedents, inter alia, the decision of the Hon’ble ITAT in the case of Antikumar H. Shah vs. ACIT and CIT vs. Multiplan India Pvt. Ltd. [38 ITD 320 (Del)], the Ld. CIT(A) held that the appeal was liable to be dismissed for want of prosecution. 5. Against the order of the Ld. CIT(A) the assessee preferred an appeal before the Tribunal. 6. During the course of hearing, the Ld. AR submitted that the Ld. CIT(A) erred in dismissing the appeal without serving the mandatory notice under section 250 of the Income Tax Act to the assessee’s correct and designated email address, as reflected on Printed from counselvise.com 4 the Income Tax Portal and in Form 35. It was contended that such non-service of notice constituted a violation of the principles of natural justice and deprived the assessee of an effective opportunity to present his case. The Ld. AR further submitted that the reassessment proceedings initiated under section 148 were invalid in law, as the mandatory approval required under section 151 had been obtained from an non-competent authority. It was also argued that the addition of Rs. 17,41,400/- made under the head “Short Term Capital Gain” was devoid of any legal or factual foundation. In addition, the initiation of penalty proceedings under sections 270A and 272A(1)(d) was assailed as being unwarranted and without proper justification. The Ld. AR prayed that the matter be restored to the file of the Ld. CIT(A) with a direction to adjudicate the appeal afresh on merits after affording the assessee a reasonable opportunity of being heard. 7. Per contra, the Ld. DR relied on the orders of the lower authorities. 8. We have heard the rival contention of both the parties and perused the material available on the record. In the present case, we find that the Ld. CIT(A) had erred in dismissing the appeal for non-prosecution without ensuring that notice under section 250 of the Income Tax Act, 1961, had been properly served upon the assessee. It was held that the failure to serve the requisite notice constituted a breach of procedural fairness and a violation of the principles of natural justice. It was further noted that the Ld. CIT(A) had not adjudicated upon the core issues raised in the appeal, Printed from counselvise.com 5 including the validity of the notice issued under section 148, the propriety of the approval granted under section 151, and the merits of the addition made under the head “Short Term Capital Gain.” The delay of 34 days in filing the appeal was also not examined or addressed in accordance with law. In view of these deficiencies, we set aside the impugned order of the Ld. CIT(A) and remand the matter back to file of Ld. CIT(A) with a direction to adjudicate the appeal afresh on merits, after verifying the service of notice and ensuring due compliance with the principles of natural justice. Accordingly, the appeal is allowed for statistical purposes. 9. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 29/07/205. Sd/- Sd/- लिलत क ुमार क ृणवȶ सहाय (LALIET KUMAR) (KRINWANT SAHAY) Ɋाियक सद˟ /JUDICIAL MEMBER लेखा सद˟/ ACCOUNTANT MEMBER AG आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to : 1. अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. आयकर आयुƅ (अपील)/ The CIT(A) 5. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 6. गाडŊ फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar Printed from counselvise.com "