BHARATKUMAR RAJASHREE,BENGALURU V. INCOME TAX OFFICER, WARD-7(2)(1), BANGALORE

ITA 1279/BANG/2025

AI Insights

This case involves an appeal by Smt. Bharatkumar Rajashree against the order of the CIT(Appeals), which confirmed the addition of Rs. 33,45,000 as unexplained cash credits under Section 68 of the Income Tax Act, 1961. The addition was initially made by the Assessing Officer (AO) in the assessment order dated 22/12/2018 for the assessment year 2016-17. The CIT(A) dismissed the appeal for non-compliance, stating that the appellant failed to provide evidence to rebut the AO's findings. However, the Tribunal found that the CIT(A) erred in dismissing the appeal without adjudicating on the merits, as mandated by Sections 250(4), 250(6), and 251 of the Act.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716680 (ITAT-BANGALORE)
• Duration Of Justice: 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 30-05-2025
• Other Referred Cases: PCIT (Central) v/s Premkumar Arjundas Luthra (HUF)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: REVENUE; GANESH R GHALE; STANDING
• Assessee Lawyers: MADHUSUDHAN
• Keywords: Set aside; Opportunity of being heard; Unexplained cash credit; Unexplained investment
• Section: 143(3); 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC’’BENCH: BANGALORE BEFORE Dr. DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI PRAKASH CHAND YADAV, JUDICIAL MEMBER ITA No.1279/Bang/2025 Assessment Year: 2016-17 Smt. Bharatkumar Rajashree, C/o. M/s. TRAVENZA Holidays, No. 180/A, 16th Main 4th ‘T’ Block, Jayanagar, Bengaluru-560041. PAN NO : AUOPR4145D Vs. Income Tax Officer, Ward-7(2)(1), Bengaluru. APPELLANT RESPONDENT Appellant by : Sri Madhusudhan, Advocate Respondent by : Sri Ganesh R Ghale, Advocate-Standing Counsel for Revenue Date of Hearing : 18.08.2025 Date of Pronouncement : 19.08.2025 O R D E R PER Dr. DIPAK P. RIPOTE, ACCOUNTANT MEMBER: This appeal filed by Smt. Bharatkumar Rajashree against the order of the Learned CIT(Appeals) (NFAC) passed U/s. 250 of the Income Tax Act, 1961 (in short “the Act”) for Asst Year 2016-17 on 05/03/2025 emanating from Assessment Order dated 22/12/2018 passed U/s. 143(3) of the Act. 2. The assessee has raised 11 Grounds of Appeal which are argumentative in nature and mainly they revolve around the decision of the Ld. CIT(A)’s in confirming the addition of Rs. 33,45,000/- (being 1/3rd of the entire amount for being joint holder Printed from counselvise.com Page 2 of 4 ITA No.1279/Bang/2025 Smt. Bharatkumar Rajashree of the account with two other members) made by the Ld. Ld. AO towards unexplained cash credits and dismissing the appeal of the assessee ex-parte without providing proper opportunity of being heard to the assessee. 3. Findings and Analysis: We have heard both the parties and perused the records. In this case, the Ld. CIT(A) has dismissed the appeal of the assessee for non-compliance. The relevant Paras 5.6 and 5.7 of the Ld. CIT(A)’s order is reproduced hereunder: “5.6. During the appellate proceedings, despite issuance of various hearing notices, the appellant has not produced any relevant evidences to rebut the said finding of the Ld. AO. Hence, I am of the considered view that the appellant did not discharge her onus of providing as to why the amount of Rs. 1,00,35,000/- deposited in the above said bank account should not be considered as unexplained investment U/s 68 of the Act. Hence, the addition of Rs. 33,45,000/- (1/3rd of the entire amount for being joint holder of the account with other two members) made by the Ld. AO is sustainable. 5.7. Hence, respectfully following the above mentioned judicial pronouncements and in view of the facts of the case, the grounds of appeal filed by the appellant are hereby dismissed. 6. In the end result, the appeal of the appellant is hereby dismissed.” 4. Thus, the Ld. CIT(A) has dismissed the appeal of the assessee without adjudicating the Grounds raised by the assessee on merits. 5. The Hon’ble Bombay High Court in the case of PCIT (Central) v/s Premkumar Arjundas Luthra (HUF), [2017] 297 CTR 614 (Bom.), wherein the Hon’ble High Court has held as under:– Printed from counselvise.com Page 3 of 4 ITA No.1279/Bang/2025 Smt. Bharatkumar Rajashree “8. From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) is coterminous with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251 (2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.\" 6. Respectfully following the decision of the Hon’ble Bombay High Court’s decision PCIT (Central) v/s Premkumar Arjundas Luthra (HUF) (supra), it is held that it is mandatory for the Ld. CIT(A) to discuss and adjudicate the Grounds raised by the Printed from counselvise.com Page 4 of 4 ITA No.1279/Bang/2025 Smt. Bharatkumar Rajashree assessee. However, in this case, the Ld. CIT(A) has not adjudicated the Grounds raised by the assessee. 7. Therefore, the order of Ld. CIT(A) is set-aside to Ld. CIT(A) for denovo adjudication. Accordingly, all the Grounds raised by the assessee are allowed for statistical purposes. 8. In the result, appeal of the assessee is allowed for statistical purposes as indicated herein above. Order pronounced in the open court on 19th August, 2025 Sd/- (Prakash Chand Yadav) Judicial Member Sd/- (Dr. Dipak P. Ripote) Accountant Member Bangalore, Dated: 19th August, 2025. OKK/SPS Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The DR, ITAT, Bangalore. 5 Guard file By order Asst. Registrar, ITAT, Bangalore. Printed from counselvise.com "