KISHORKUMAR KOTUMAL CHANGLANI,AHMEDABAD V. THE ITO, WARD-7(2)(1), AHMEDABAD

ITA 1477/AHD/2025

AI Insights

The case involves Kishorkumar Kotumal Changlani, the appellant, who contested the additions made to his income by the Assessing Officer (AO) under sections 69A of the Income Tax Act, 1961, for the Assessment Year 2018-2019. The AO had added Rs. 74,50,000 as unexplained money, which was allegedly part of bogus unsecured loans, and an additional Rs. 48,00,000 found deposited in the appellant's bank account. The CIT(A) upheld these additions, leading to the appeal before the Tribunal. The Tribunal found that the appellant was not adequately represented at the CIT(A) level due to issues with email notifications and thus decided to restore the matter for a fresh hearing, emphasizing the need for a fair opportunity to present his case.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 835973 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Appeal Filed On: 23-07-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NITIN VISHNU KULKARNI
• Assessee Lawyers: TUSHAR HEMANI
• Keywords: Set aside; Principle of natural justice; Search and seizure; Accommodation entries; Initiation of penalty proceedings; Bogus

Judgement Text

" आयकर अपीलीय अिधकरण, अहमदाबाद \u0011ायपीठ “सी“,अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL “C ” BENCH, AHMEDABAD \u0016ी संजय गग\u001a, \u0011ाियक सद\u001b एवं \u0016ी मकरंद वसंत महादेवकर, लेखा सद\u001b क े सम!। ] ] Before Shri Sanjay Garg, Judicial Member And Shri Makarand V. Mahadeokar, Accountant Member आयकर अपील सं /ITA No.1477/Ahd/2025 िनधा \u000fरण वष\u000f /Assessment Year : 2018-19 Kishorkumar Kotumal Changlani Block No.413 B Sardarnagar Pani Ni Tank Sardarnagar Ahmedabad – 382 345 बनाम/ v/s. The ITO Ward-7(2)(1) Ahmedabad – 380 015 \u0013थायी लेखा सं./PAN: ACVPC 3793 K (अपीलाथ$/ Appellant) (%& यथ$/ Respondent) Assessee by : Shri Tushar Hemani, Sr. Advocate Revenue by : Shri Nitin Vishnu Kulkarni, Sr.DR सुनवाई की तारीख/Date of Hearing : 12/11/2025 घोषणा की तारीख /Date of Pronouncement: 09/02/2026 आदेश/O R D E R Per Sanjay Garg, Judicial Member: The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 23/05/2025 passed u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2018-2019. 2. The assessee, in this appeal, has raised the following grounds of appeal: Printed from counselvise.com ITA No.1477/Ahd/2025 Kishorkumar Kotumal Changlani vs. ITO Asst.Year : 2018-19 2 “[Arising from an order u/s 250 of the Income Tax Act 1961 dated 23-05-2025] 1. On the facts and under the circumstances of the case and on appraisal of the relevant statutory provisions the learned Commissioner of Income Tax (Appeals) was not justified in confirming the addition of Rs. 74,50,000/- u/s 69A of the Act without taking into consideration the fact such amount was part of regular books of accounts and the identity, source and genuineness of the loan was established through the documentary evidences filed in the course of assessment proceedings. 2. On the facts and under the circumstances of the case and on appraisal of the relevant statutory provisions the learned Commissioner of Income Tax (Appeals) was not justified in confirming the addition of Rs. 48,00,000/- (Rs. 47,00,000/- on 16.01.2018 + Rs. 1,00,000/- on 01.03.2018) u/s 69A of the Act without taking into consideration the fact that the above amount was part of regular books of accounts and the identity, source and genuineness of the loan was established through the documentary evidences filed in the course of assessment proceedings. 3. On the facts and under the circumstances of the case and on appraisal of the relevant statutory provisions, the learned Commissioner of Income Tax (Appeals) was not justified in initiating penalty proceedings u/s 271AAC of the Act without satisfying the statutory requirement for initiation of penalty proceedings. 4. On the facts and circumstances of the case the order is otherwise perverse, bad in law and passed in contravention to the principles of natural justice. 5. The Appellant craves leave to produce documentary evidences as referred to in various grounds of appeal as above and add, amend or abandon any ground(s) of appeal taken above in course of the hearing/fling of ground wise submission in the case.” 3. The brief facts of the case are that the assessee is an individual and filed his return of income for AY 2018-19 on 31/08/2019 declaring income of Rs.10,07,140/-. The case has been flagged in the Income Tax Insight Portal under the category “High risk CRIU/VRU cases”. A search and seizure action was carried out in the case of Omkara Asset Reconstruction Pvt.Ltd. (for short “Omkara”) and related entities. These related entities included various companies of Areion Group, which were related to Omkara. From the post search enquiry, it was revealed that this group companies were Printed from counselvise.com ITA No.1477/Ahd/2025 Kishorkumar Kotumal Changlani vs. ITO Asst.Year : 2018-19 3 involved in providing bogus/accommodation entries. It was noticed that the assessee was also one of the beneficiaries, who had taken bogus unsecured loan of Rs.67,00,000/- from Shri Bhavesh Shah and Rs.7,50,000/- from M/s. Bhupendra Gandhi. Accordingly, the Assessing Officer (AO) made the addition of Rs.74,50,000/- treating the same as unexplained money of the assessee u/s.69A of the Act. The AO also added a sum of Rs.48,00,000/-, which was found deposited in the HDFC bank account of the assessee, as unexplained money u/s.69A of the Act. Thus, the AO assessed the income of the assessee of Rs.1,32,57,140/-. 4. Aggrieved by the aforesaid order of the AO, the assessee preferred an appeal before the Ld. CIT(A), who confirmed the action of the AO and dismissed the appeal of the assessee. 5. Aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before us. 6. We have heard the rival contentions of the Ld. Representatives of the parties and gone through the record. At the outset, the Ld. AR of the assessee submitted that the assessee is an old-aged person. That the notices issued by the Ld. CIT(A) on the e-mail of the assessee could not be noticed by the assessee and, therefore, the case of the assessee remain unrepresented before the Ld. CIT(A). He has further submitted that assessee has a fair case on merits. He, therefore, has submitted that in the interests of justice, the assessee may be given an opportunity to present his case before the Ld. CIT(A). Printed from counselvise.com ITA No.1477/Ahd/2025 Kishorkumar Kotumal Changlani vs. ITO Asst.Year : 2018-19 4 7. In our view, the interests of justice, will be well-served, if the assessee be given an opportunity to present his case before the Ld. CIT(A). The assessee for his failure to furnish the requisite details before the Ld. CIT(A), can be burdened with some costs. We, accordingly, direct the assessee to deposit a sum of Rs.5,000/- in Prime Minister’s National Relief Fund. The assessee will furnish the proof of such deposit before the Ld. CIT(A). Subject to fulfilment of the aforesaid condition, the impugned order of the Ld. CIT(A) is hereby set aside and matter is restored the matter to the file of Ld. CIT(A) for decision afresh. The Ld. CIT(A) will give proper and adequate opportunity to the assessee to present his case. 8. With the above observations, the appeal of the assessee is treated as allowed for statistical purposes. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 09/02/2026. Sd/- - Sd/- (Makarand V. Mahadeokar) Accountant Member ( Sanjay Garg ) Judicial Member िदनांक/Dated 09/02/2026 टी.सी.नायर, व.िन.स./T.C. NAIR, Sr. PS Printed from counselvise.com ITA No.1477/Ahd/2025 Kishorkumar Kotumal Changlani vs. ITO Asst.Year : 2018-19 5 आदेश की ितिलिप अ!ेिषत/Copy of the Order forwarded to : 1. अपीलाथ\" / The Appellant 2. #थ\" / The Respondent. 3. संबंिधत आयकर आयु% / Concerned CIT 4. आयकर आयु% ) अपील ( / The CIT(A)- (NFAC), Delhi 5. िवभागीय ितिनिध , अिधकरण अपीलीय आयकर , अहमदाबाद /DR,ITAT, Ahmedabad. 6. गाड\u000f फाईल / Guard file. आदेशानुसार/ BY ORDER, स#ािपत ित //True Copy// सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad 1. Date of dictation (dictation on computer)) : 4.2.2026 2. Date on which the typed draft is placed before the Dictating Member. : 4.2.2026 3. Date on which the approved draft comes to the Sr.P.S./P.S : 4. Date on which the fair order is placed before the Dictating Member for pronouncement. : 5. Date on which fair order placed before Other Member : 6. Date on which the fair order comes back to the Sr.P.S./P.S. : 10.2.26 7. Date on which the file goes to the Bench Clerk. : 10.2.26 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 Despatch of the Order : Printed from counselvise.com "