AMIT SAINI,KURUKSHETRA V. INCOME TAX OFFICER, WARD-1, KURUKSHETRA, HARYANA, WARD-I, KUK, HARYANA

ITA 929/CHANDI/2025

AI Insights

The case involves an appeal by the assessee, Amit Saini, against the order of the CIT(A)/NFAC, Delhi, which confirmed the additions made by the Assessing Officer (AO) regarding undisclosed business income from export sales for the Assessment Year 2018-19. The AO had completed the assessment ex parte under section 144 of the Income-tax Act, treating 6% of the export receipts as undisclosed business income. The CIT(A) upheld this decision, noting the assessee's failure to comply with notices. The Tribunal found that the assessee was not given a reasonable opportunity to present his case and thus restored the matter to the AO for a de novo assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 779367 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 18-07-2025
• Other Referred Cases: CIT v. B.N. Bhattacharjee (118 ITR 461), Estate of Late Tukojirao Holkar v. CWT (223 ITR 480)
• Laws Referred To: Income-tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN
• Assessee Lawyers: DHRUV GOEL; C.A
• Keywords: Set aside; Business income; Opportunity of being heard; Principle of natural justice; Presumptive income
• Section: 144; 44AD

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. 929 /Chd/ 2025 िनधाŊरण वषŊ / Assessment Year : 2018-19 Amit Saini # M/s Durga Pipe & M/s Durga Export, Plot No. 67, Industrial Area, Sector- 2, Kurukshetra,Haryana-136118 बनाम The ITO Ward-1 Kurukshetra-136118 ˕ायी लेखा सं./PAN NO: BIGPS2930E अपीलाथŎ/Appellant ŮȑथŎ/Respondent िनधाŊįरती की ओर से/Assessee by : Shri Dhruv Goel, C.A राजˢ की ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 07/10/2025 उदघोषणा की तारीख/Date of Pronouncement : 16/10/2025 आदेश/Order PER KRINWANT SAHAY, A.M: This is an appeal filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi dt. 09/05/2024 pertaining to Assessment Year 2018-19. 2. At the outset the Registry has pointed out that the present appeal is barred by limitation by 352 days for which the assessee had filed the condonation application seeking condonation. The condonation application is placed on record. 3. Ld. Sr. DR strongly opposed the condonation of delay. 4. After considering the condonation application filed by the assessee in the present appeal, we condone the delay for which sufficient cause is shown, and admit the appeal for adjudication. Printed from counselvise.com 2 5. In the present appeal Assessee has raised the following grounds: 1. That the learned CIT(A) has erred in law and on facts in confirming the actions of AO in making additions of Rs. 5,25,364/ on account of undisclosed business income from export sales. 2. That the authorities below have erred in law and on facts in making as well as confirming the additions without an adequate opportunity of being heard provided to the assessee. 6. Briefly the facts of the case are that the assessee, an individual filed his return of income for the Assessment Year 2018–19 on 31.03.2019, declaring total income of Rs.4,93,260/- under the presumptive provisions of section 44AD of the Income-tax Act. The total turnover declared was Rs.1,06,85,300/- and presumptive income at 6% thereof was Rs.6,43,255/-. 6.1 During the assessment proceedings, the Assessing Officer noticed from the ITS data that the assessee had export transactions amounting to Rs.87,56,073/-. The assessee did not respond to notices and therefore the assessment was completed ex parte under section 144 of the Act. The Assessing Officer treated 6% of the said export receipts amounting to Rs.5,25,364/- as undisclosed business income and added the same to the total income of the assessee, resulting in the assessed income of Rs.4,93,260/- plus the said addition. 7. Against the order of the AO the assessee went in appeal before the Ld. CIT(A). However, despite several notices under section 250 being issued electronically to the registered e-mail address, there was no compliance by the assessee. The CIT(A), therefore, proceeded ex parte and held that the assessee had failed to substantiate his grounds of appeal or file any documentary evidence in support of his claim. 7.1 The CIT(A) observed that the Assessing Officer had rightly made the addition under section 144 of the Act since the assessee had not availed the opportunities given. Relying upon various judicial pronouncements, including CIT v. B.N. Bhattacharjee (118 ITR 461) and Estate of Late Tukojirao Holkar v. Printed from counselvise.com 3 CWT (223 ITR 480), the CIT(A) dismissed the appeal holding that the assessee failed to discharge his onus and that there was no violation of natural justice by the Department. Accordingly, the order of the Assessing Officer was confirmed and the appeal was dismissed. 8. Against the order of the Ld. CIt(A) the assessee preferred in appeal before the Tribunal. 9. During the course of hearing the Ld. AR submitted that the authorities below erred in confirming the addition of Rs.5,25,364/- without affording a reasonable opportunity of being heard. It was contended that the assessee could not respond to the earlier notices due to unavoidable circumstances and lack of communication, and that the entire assessment was completed ex parte. The Ld. AR further submitted that the addition made by the Assessing Officer is merely based on an assumption of 6% profit on export sales, without verifying the books of account or the actual nature of the transactions. He urged that the matter may kindly be restored to the file of the Assessing Officer for de novo consideration, so that the assessee may present proper evidence in support of his return of income and turnover. 10. Per contra, the Ld. DR relied on the orders of the authorities below. 11. We have considered the rival submissions and perused the orders of the authorities below. It is evident that the assessment was completed ex parte under section 144 of the Act and that the CIT(A) also decided the appeal ex parte on account of non-compliance. The assessee has pleaded that the non-appearance was not deliberate but due to genuine reasons. In the interest of substantial justice, we are of the view that the assessee deserves one more opportunity to present his case before the Assessing Officer. The addition made was on a presumptive basis without examining the export records or explaining whether such export receipts were already part of the turnover declared under section 44AD. Printed from counselvise.com 4 11.1 We therefore deem it just and proper to set aside the impugned order of the CIT(A) and restore the matter to the file of the Assessing Officer with a direction to frame a fresh assessment after affording adequate opportunity of being heard to the assessee and after considering all documentary evidence to be filed by him in support of his claim. The assessee is also directed to extend full cooperation and promptly respond to any notices issued by the Assessing Officer. 12. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 16/10/2025 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 "