BRIJESHKUMAR NATVARLAL PATEL,AHMEDABAD V. ITO, WARD-1(2)(1), AHMEDABAD

ITA 1333/AHD/2025

AI Insights

The case involves Brijeshkumar Natvarlal Patel, who appealed against the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi. The appeal was related to the assessment year 2015-16, where the AO had added an amount of Rs. 66.95 Lakhs to the assessee's income under Section 69A of the Income Tax Act, 1961, due to unexplained investment in property. The AO had reopened the assessment under Section 148 based on information that the assessee had purchased immovable property and was a non-filer of income tax returns. The assessee, a non-resident Indian (NRI) and a US citizen, contended that the entire amount for the property was paid in the preceding year and not in the impugned year. The Tribunal found that the assessee had provided sufficient cause for not participating in the earlier proceedings and granted a fresh opportunity for a fair adjudication.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 783307 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 18-06-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAMTA SINGH
• Assessee Lawyers: PARIN SHAH
• Keywords: Set aside; Reopening of assessment; TDS; Source of fund; Initiation of penalty proceedings
• Section: 148; 271(1)(c)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD BEFORE: SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI T.R. SENTHIL KUMAR, JUDICIAL MEMBER आयकर अपील सं./I.T.A. No. 1333/Ahd/2025 (िनधा[रण वष[ / Assessment Year : 2015-16) Brijeshkumar Natvarlal Patel 71/72, Mahalay Bungalows, B/h. Kargil Petrol Pump, Sola, Ahmedabad – 380060, Gujarat बनाम/ Vs. ITO Ward-1(2)(1), Ahmedabad Öथायी लेखा सं./जीआइआर सं./PAN/GIR No. : AWRPP3417F (Appellant) .. (Respondent) अपीलाथȸ ओर से /Appellant by : Shri Parin Shah, AR Ĥ×यथȸ कȧ ओर से/Respondent by : Smt. Mamta Singh, Sr.DR Date of Hearing 06/11/2025 Date of Pronouncement 07/11/2025 (आदेश)/ORDER PER ANNAPURNA GUPTA, AM: The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), (hereinafter referred to as “CIT(A)”), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi dated 15.04.2025 passed under Section 250 of the Income Tax Act, 1961 Printed from counselvise.com ITA No. 1333/Ahd/2025 [Brijeshkumar Natvarlal Patel vs. ITO] A.Y. 2015-16 - 2 – (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2015-16. 2. The grounds of appeal raised by the assessee are as under: “1. The order passed by lower authorities are invalid, bad in law and required to be quashed. 2. The reopening of assessment u/s 148 of the Act is bad in law and required to be quashed. 3. Ld. NFAC erred in law and on facts in confirming addition of Rs. 6695000/- u/s 69A of the Act. 4. Ld. NFAC ought to have passed order as per the provision of section 250(6) of the Act. 5. Appellant prays that appeal may be set aside to file of AO OR CIT (A) for adjudication on merits. 6. Initiation of penalty proceedings u/s 271(1)(c) of the Act is unjustified. 7. Charging of interest u/s 234A, 234B, 234C of the Act are unjustified.” 3. The solitary issue in the present appeal relates to addition made to the income of the assessee on account of investment made in a property purchased in the impugned year amounting to Rs.66.95 Lakhs, the source of which remained unexplained. The orders of the authorities below reveal that the case of the assessee was reopened by issuing notice u/s.148 of the Act on the information in the possession of the AO that the assessee had purchased an immovable property during the impugned year amounting to Rs.66.95 Lakhs and was a non-filer of return of Printed from counselvise.com ITA No. 1333/Ahd/2025 [Brijeshkumar Natvarlal Patel vs. ITO] A.Y. 2015-16 - 3 – income. Accordingly, the AO was of the belief that the income, to the extent of investment made in the impugned property by the assessee, had escaped assessment and therefore re-assessment proceedings were initiated on the assessee. The assessment order subsequently was passed ex parte in the absence of any cooperation from the assessee during assessment proceedings, notices being issued to him remaining completely uncomplied with. The order of AO reveals that in response to one notice, the assessee, vide his reply dated 27.10.2023, submitted that he was a Non-resident and was unaware of the notices being issued to him. He got information from his Tax Consultant about the issuance of notices and he further informed the AO that he had purchased property during the impugned year on which TDS had been deducted. That he needed time to compile and collect all documents to prove the genuineness of the transaction. However, since, the subsequent notices issued also remained uncomplied with, the AO passed the order making an ex parte assessment adding the entire amount of investment made by the assessee in immovable property amounting to Rs.66.95 Lakhs u/s.69A of the Act to the income of the assessee. 4. The assessee carried the matter in appeal before the Ld. CIT(A) though with a delay of 312 days. The assessee sought condonation of the delay submitting that he had permanently shifted to Florida, USA in 2001 and he was running a convenience store at a gas station. That he had become an American citizen in Printed from counselvise.com ITA No. 1333/Ahd/2025 [Brijeshkumar Natvarlal Patel vs. ITO] A.Y. 2015-16 - 4 – 2009 and as per the Indian Taxation Laws, he was an NRI since then. That currently also he was settled in USA. That he was unaware of the notices issued to him of the assessment proceedings and only when he was informed by his Consultant of the same, that he requested the AO seeking time to file reply since he was not in possession of his old bank statement for the impugned year or of the purchase deeds as they were in India and he could access them only by personally visiting India. That before he could collect these documents, the AO passed the order of which he got information from his Consultant, but, was unable to file an appeal against the same, since, he was a alone responsible for running his convenience store and could not manage to leave it immediately. As and when he managed to come to India in January 2024, he prepared the necessary documents for filing the appeal before the Ld. CIT(A). 5. The Ld. CIT(A), however, dismissed the appeal noting that the assessee did not participate in the appellate proceedings despite three notices being issued to it. 6. Before us, Ld. Counsel for the assessee contended that the assessee had good case in his favour since the documents relating to the impugned transaction of purchase of property itself revealed that the entire amount was paid in the preceding year by the assessee and not in the impugned year. He contended that the assessee was in possession of copy of bank statements and he Printed from counselvise.com ITA No. 1333/Ahd/2025 [Brijeshkumar Natvarlal Patel vs. ITO] A.Y. 2015-16 - 5 – pleaded that if given an opportunity, he was ready to cooperate with the Revenue authorities and bring all facts on record for fair adjudication of the issue. Before us, copy of the purchase deed of the impugned property was placed. 7. The Ld. DR objected to the assessee being granted fresh opportunity of hearing. 8. We have gone through the orders of the authorities below and though it is true that the assessee did not participate in the assessment proceedings or even in the appellate proceedings, but the fact remains that the assessee had adduced sufficient cause for the same before the Revenue authorities. He had stated to be a US citizen and an NRI and had given reasons for not submitting relevant details of purchase of property during the assessment proceedings stating that the documents needed to be procured from India for which he needed to physically visit which he was unable to manage till the assessment order was passed. These facts have not been found to be untrue by any of the Revenue authorities. Even the Ld. CIT(A), we have noted, has given only three opportunities of hearing to the assessee. Considering the entire facts and circumstances, therefore, we are of the view that in the interest of justice, the assessee should be granted an opportunity of hearing and opportunity to place all documents relevant to the impugned transaction to establish his case of the property being purchased by him from disclosed sources of income. Accordingly, Printed from counselvise.com ITA No. 1333/Ahd/2025 [Brijeshkumar Natvarlal Patel vs. ITO] A.Y. 2015-16 - 6 – we consider it fit to restore the matter back to the AO to directing him to give the assessee due opportunity of hearing and to adjudicate the issue afresh in accordance with law. 9. In the result, appeal filed by the assessee is allowed for statistical purposes. This Order pronounced on 07/11/2025 Sd/- Sd/- (T.R. SENTHIL KUMAR) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 07/11/2025 S. K. SINHA True Copy आदेश कȧ Ĥितिलǒप अĒेǒषत/Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant 2. Ĥ×यथȸ / The Respondent. 3. संबंिधत आयकर आयुƠ / Concerned CIT 4. आयकर आयुƠ(अपील) / The CIT(A)- 5. ǒवभागीय Ĥितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड[ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad Printed from counselvise.com "