INFINITY BUILDCOM,AHMEDABAD V. ITO WARD 3(3)(2), AHMEDABAD, VEJALPUR, AHMEDABNAD

ITA 2671/AHD/2025

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The case involves Infinity Buildcom, a partnership firm, which appealed against the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi. The appeal was initially time-barred, but the Tribunal condoned the delay considering the assessee's explanation of non-communication from their tax consultant. The primary issues in the appeal included the treatment of certain unsecured loans and creditors as unexplained under sections 68 and 69 of the Income Tax Act, and the ex-parte nature of the original assessment. The Tribunal found that the Assessing Officer had acted within jurisdiction and followed due process, but granted a final opportunity to the assessee to present its case, citing principles of natural justice.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837838 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 30-12-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C DHARANI NATH
• Assessee Lawyers: CHETAN AGRAWAL
• Keywords: Opportunity of being heard; Reassessment proceedings; Corroborative evidences; Unexplained cash credit; Unexplained investment; Principle of natural justice; Initiation of penalty proceedings; Bogus
• Section: 147; 148; 144; 142(1); 271(1)(c); 68; 69

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I.T.A. No.2671/Ahd/2025 (Assessment Year: 2012-13) Infinity Buildcom, 9, Khurshid Park, Opp. Ikra Hospital, Sarkhej, Road, Ahmedabad-380055 Vs. Income Tax Officer, Ward-3(3)(2), Ahmedabad [PAN No.AADFI3226P] (Appellant) .. (Respondent) Appellant by : Shri Chetan Agrawal, CA Respondent by: Shri C Dharani Nath, Sr. DR Date of Hearing 05.02.2026 Date of Pronouncement 19.02.2026 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated 12.08.2025 passed for A.Y. 2012-13. 2. The assessee has raised the following grounds of appeal: “1. The Ld. CIT(A) has erred in law as well as on fact by upholding addition of Rs. 2,21,00,000/- made by Ld. AO being unsecured loans treated as unaccounted credit u/s 68 of the Act. 2. The Ld. CIT(A) has erred in law as well as on fact by upholding addition of Rs. 2,75,42,183/- made by Ld. AO being unsecured creditors treated as unexplained and bogus u/s 68 of the Act. 3. The Ld. CIT(A) has erred in law as well as on fact by upholding addition of Rs. 45,00,000/- made by Ld. AO being purchase of an immovable property treated as unexplained investment u/s 69 of the Act. 4. The Ld. CIT(A) has erred in law as well as on fact by passing an ex parte order without providing sufficient opportunity of being heard to the assessee.” Printed from counselvise.com ITA No. 2671/Ahd/2025 Infinity Buildcom vs. ITO Asst.Year –2012-13 - 2– 3. At the outset, we note that the present appeal is time barred by 60 days. The assessee moved an application alongwith an Affidavit explaining the reason that the assessee was not aware about the order passed by the CIT(A) due to the tax consultant of the assessee did not inform him about the notices issued to the assessee. When the assessee received call from the Department thereafter, the assessee immediately preferred an appeal before the ITAT. Considering the explanation furnished, the supporting affidavit, and in the larger interest of justice, we are of the view that the delay deserves to be condoned. Accordingly, the delay of 60 days in filing the appeal is hereby condoned. The appeal is admitted for adjudication on merits. 4. The brief facts of the case are that the assessee, a partnership firm namely Infinity Buildcom, filed its return of income for Assessment Year 2012-13 declaring total income of Rs.1,17,717/-. Subsequently, the Assessing Officer received information from the Investigation Wing that the assessee had received an unexplained amount of Rs.20,00,000/- from one Shri Aadilhusen A. Ansari. Based on this information, the Assessing Officer reopened the assessment under section 147 of the Income-tax Act, 1961 (“the Act”), after recording reasons and obtaining due approval, and notice under section 148 of the Act was issued. During the reassessment proceedings, the Assessing Officer issued notices under section 142(1) of the Act along with questionnaires calling upon the assessee to furnish details and explanations. As there was no compliance from the assessee, a show cause notice was issued proposing to complete the assessment ex- parte under section 144 of the Act. Despite opportunities, the assessee failed to file any reply or supporting documents. Printed from counselvise.com ITA No. 2671/Ahd/2025 Infinity Buildcom vs. ITO Asst.Year –2012-13 - 3– 5. In the absence of any explanation, the Assessing Officer completed the assessment ex-parte under section 144 read with section 147 of the Act. The Assessing Officer treated the sum of Rs.20,00,000/- received from Shri Aadilhusen A. Ansari as unexplained income. Further, the Assessing Officer noticed that the assessee had shown unsecured loans of Rs.2,21,00,000/- in the return of income filed subsequently, whereas no such loans were reflected in the earlier year. Since no confirmations or explanations were furnished by the assessee, the same were added as unexplained cash credits under section 68 of the Act. The Assessing Officer also observed a substantial increase in sundry creditors, resulting in an unexplained difference of Rs.2,75,42,183/-, which the Assessing Officer treated as bogus creditors and added the same under section 68 of the Act as income of the assessee. Further, the Assessing Officer noticed that the assessee had purchased an immovable property amounting to Rs.45,00,000/-, which remained unexplained and accordingly, the Assessing Officer added the same as unexplained investment under section 69 of the Act. Accordingly, the Assessing Officer assessed the total income of the assessee at Rs.5,42,59,903/-, and also initiated penalty proceedings under sections 271(1)(c) and 271B of the Act separately. 6. Aggrieved, the assessee preferred an appeal before the CIT(Appeals). During the appellate proceedings, several notices of hearing were issued to the assessee over a prolonged period. However, except for one response containing general and legal assertions without any supporting evidence, the assessee failed to effectively participate in the appellate proceedings or furnish documentary evidence to rebut the findings of the Assessing Officer. Printed from counselvise.com ITA No. 2671/Ahd/2025 Infinity Buildcom vs. ITO Asst.Year –2012-13 - 4– 7. On merits, the CIT(Appeals) dealt with each of the grounds raised by the assessee. With regard to the challenge to reopening under section 147 and issuance of notice under section 148, the CIT(Appeals) held that the Assessing Officer had acted within his jurisdiction after receiving credible information and after following due process, and therefore the contention that the proceedings were initiated by an unauthorised person was rejected. In respect of the additions made under sections 68 and 69 of the Act, the CIT(Appeals) observed that the assessment was completed under section 144 of the Act only because of the non-cooperation of the assessee, and in the absence of any explanation or evidence, the Assessing Officer was justified in making the additions on the basis of material available on record. The CIT(Appeals) further held that the demand raised under section 156 and initiation of penalty proceedings were consequential and valid in law. The allegations made by the assessee against the Assessing Officer regarding mala fides and liability for compensation were found to be baseless and unsupported by any material. In view of repeated non-compliance and lack of substantiation of grounds, the CIT(Appeals) dismissed the appeal and sustained all the additions made by the Assessing Officer. 8. The assessee is in appeal before us against the order passed by CIT(Appeals) dismissing the appeal of the assessee. 9. We have heard the rival contentions and perused the material on record. We find that the assessment in the present case has been completed ex-parte under section 144 read with section 147 of the Act due to non- compliance on the part of the assessee. We also note that before us, the assessee has contended that it was unable to effectively place its case and supporting material before the Assessing Officer as well as before the first Printed from counselvise.com ITA No. 2671/Ahd/2025 Infinity Buildcom vs. ITO Asst.Year –2012-13 - 5– appellate authority. Considering the above facts and keeping in view the principles of natural justice, we are of the considered view that the assessee deserves one final opportunity to present its case on merits. 10. At the same time, we cannot lose sight of the fact that the assessee has remained non-cooperative at all stages of the proceedings and has failed to comply with statutory notices, which has resulted in protracted litigation. Therefore, in order to balance the interests of justice and to ensure discipline in the proceedings, we deem it appropriate to restore the matter to the file of the Assessing Officer for de-novo consideration, subject to payment of cost. 11. Accordingly, the matter is restored to the file of the Assessing Officer for fresh adjudication in accordance with law. The Assessing Officer shall afford reasonable opportunity of being heard to the assessee and shall decide the issues afresh after examining the evidence and explanations that may be filed by the assessee. The assessee is directed to fully cooperate in the proceedings and file all relevant details and documentary evidence as may be called for by the Assessing Officer. As a condition for such restoration, the assessee shall pay a cost of Rs. 5,000/- to the credit of the Prime Minister Relief Fund and shall produce proof of such payment before the Assessing Officer. 12. In the result, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 19/02/2026 Sd/- Sd/- (ANNAPURNA GUPTA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 19/02/2026 TANMAY, Sr. PS TRUE COPY Printed from counselvise.com ITA No. 2671/Ahd/2025 Infinity Buildcom vs. ITO Asst.Year –2012-13 - 6– आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation 16.02.2026 (Dictated over dragon software) 2. Date on which the typed draft is placed before the Dictating Member 16.02.2026 3. Other Member………………… 4. Date on which the approved draft comes to the Sr.P.S./P.S 16.02.2026 5. Date on which the fair order is placed before the Dictating Member for pronouncement 19.02.2026 6. Date on which the fair order comes back to the Sr.P.S./P.S 19.02.2026 7. Date on which the file goes to the Bench Clerk 19.02.2026 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order…………………….. 10. Date of Dispatch of the Order…………………………………… Printed from counselvise.com "