JAGMOHAN GARG,PROP GARG WOOLEN MILLS V. DCIT CENTRAL CIRCLE-III, DCIT CENTRAL CIRCLE-III

ITA 763/CHANDI/2023

AI Insights

The case involves Sh. Jagmohan Garg, the proprietor of M/s Garg Woolen Mills, who appealed against the orders of the Commissioner of Income Tax (Appeals)-5, Ludhiana, for the assessment year 2019-20. The primary grievances included the improper verification of notice service and the upholding of a high-pitched addition of Rs.3,10,90,393 to the assessee's income, calculated by applying a net profit rate of 5% on total purchases and sales after rejecting the books of accounts. The Tribunal noted that both the initial and appellate orders were passed ex-parte, leading to a decision to remand the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633094 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2019-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROHIT KUMAR; VIRTUAL
• Section: 144

Judgement Text

" आयकर अपीलȣय अͬधकरण, चÖडीगढ़ Ûयायपीठ, चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH, ‘A’, CHANDIGARH BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER & SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 763/CHD/2023 Ǔनधा[रण वष[ / Assessment Year : 2019-20 Sh. Jagmohan Garg, Prop. M/s Garg Woolen Mills, Mochpura Bazar, Neemwala Chowk, Ludhiana 141008 बनाम Vs. The DCIT, Central Circle-III, Ludhiana èथायी लेखा सं./PAN NO: AQMPG0609D अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent ( Virtual Hearing ) Ǔनधा[ǐरती कȧ ओर से/Assessee by : None राजèव कȧ ओर से/ Revenue by : Sh. Rohit Kumar, CIT DR (Virtual) सुनवाई कȧ तारȣख/Date of Hearing : 20.03.2025 उदघोषणा कȧ तारȣख/Date of Pronouncement : 09.06.2025 आदेश/Order Per Krinwant Sahay, AM : Appeal in this case has been filed by the assessee against the order dated 29.09.2023 of ld. Commissioner of Income Tax (Appeals)-5, Ludhiana for A.Y. 2019-20. 763-Chd-2034 Jagmohan Garg, Ludhiana 2 2. Grounds of appeal are as under: - 1. That the impugned order is bad both on facts and law. 2. That the Ld. CIT(A) has erred in verifying the facts that whether the notices issued were duly served on the appellant before passing an ex- parte order u/s 250 [6]. 3. That the Ld. CIT(A) has wrongly and illegally upheld the high-pitched addition of Rs.3,10,90,393/- made by the AO by applying net profit rate of 5% on total of purchases and sales after rejecting the books of accounts against the settled principle of law by passing an ex-party order. 4. That the Appellant craves permission to add, amend, elucidate any ground of appeal at the time of hearing. 3. None appeared on behalf of the Assessee. However, from the record, it is gathered that the order in this case was passed ex-parte u/s 144 of the Income Tax Act, 1961 (in short 'the Act') by the Assessing Officer and the Ld. CIT(A) has also passed an ex-parte order without adjudicating any issue on merit on the basis of material available on record. As such, in this case no adequate opportunity of hearing was provided to the Assessee and the matter need to be remanded back to the CIT(A) for adjudication it afresh. 763-Chd-2034 Jagmohan Garg, Ludhiana 3 4. The ld. DR did not object if the matter is remanded to the file of the CIT(A). 5. We have considered the assessment order passed by the Assessing Officer and we find that it is an ex-parte order passed by the Assessing Officer and similarly the Ld. CIT(A) has also passed the appellate order without giving any findings on merit on the basis of material available on record. Therefore, we are inclined to remand this case back to the CIT(A) to decide and pass an order afresh on merits, in accordance with law, on affording due and adequate opportunity of hearing to the Assessee. The Assessee, no doubt, shall cooperate in the fresh proceedings before the CIT(A). All pleas available under the law shall remain so available to the assessee. Ordered accordingly. 6. In the result, Assessee’s appeal is allowed for Statistical Purposes. Order pronounced on 09. 06.2025. Sd/- Sd/- ( LALIET KUMAR ) ( KRINWANT SAHAY) Judicial Member Accountant Member “आर.क े.” 763-Chd-2034 Jagmohan Garg, Ludhiana 4 आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the order forwarded to : 1. अपीलाथȸ/ The Appellant 2. Ĥ×यथȸ/ The Respondent 3. आयकर आयुÈत/ CIT 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय आͬधकरण, चÖडीगढ़/ DR, ITAT, CHANDIGARH 5. गाड[ फाईल/ Guard File सहायक पंजीकार/ Assistant Registrar "