KUNDANBEN MAHESHCHANDRA GOR,UMBERGAON V. INCOME TAX OFFICER, VAPI

ITA 728/SRT/2024

AI Insights

The case involves Kundanben Maheshchandra Gor, the appellant, contesting several additions and disallowances made by the Income Tax Officer (ITO) for the Assessment Year 2015-16, which were upheld by the CIT(A). The additions included disallowed agricultural income, unexplained cash deposits, and other unexplained income. The appellant argued that the CIT(A) had not provided adequate opportunity to present her case, leading to an appeal before the ITAT. The ITAT found merit in the appellant's argument regarding the violation of natural justice and thus remanded the case back to the CIT(A) for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 396692 (ITAT-SURAT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: CHETAN KHAKHKHAR
• Keywords: Opportunity of being heard; Principle of natural justice; Earning of tax free income
• Section: 142(1); 56(2)(vii)(b); 10(10D)

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.728/SRT/2024 Assessment Year: (2015-16) (Hybrid Hearing) Kundanben Maheshchandra Gor, Plot no 1502, 3rd Phase, GIDC, Umbergaon - 396195 Vs. The ITO, Ward-5, Vapi èथायीलेखासं./जीआइआरसं./PAN/GIR No: AWKPG6190P (अपीलाथŎ/Appellant) (ŮȑथŎ /Respondent) Appellant by Shri Chetan Khakhkhar, AR Respondent by Shri Mukesh Jain, Sr. DR Date of Hearing 20/03/2025 Date of Pronouncement 29/05/2025 आदेश / O R D E R PER BIJAYANANDA PRUSETH, AM: This appeal by the assessee emanates from the order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), dated 30.04.2024 by the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘CIT(A)’] for the Assessment Year (AY) 2015-16. 2. Grounds of appeal raised by the assessee are as under: “1. On the facts and circumstances of the case as well as in law on the subject, the learned CIT A has erred in confirming the disallowance of agricultural income amounting to Rs. 23,65,220/-.” “2. On the facts and circumstances of the case as well as in law on the subject, the learned CIT A has erred in confirming addition of Rs. 11,64,680/- u/s. 56(2)(vii)(b) of the I.T. Act.” 2 ITA No.728/SRT/2024/AY.2015-16 Kundanben Maheshchandra Gor “3. On the facts and circumstances of the case as well as in law on the subject, the learned CIT A has erred in confirming Rs. 31,35,000/- as unexplained cash deposit.” “4. On the facts and circumstances of the case as well as in law on the subject, the learned CIT A has erred in confirming the disallowance of claim of exempt income amounting to Rs. 14,00,900/- as in come from unexplained sources.” 3. The facts of the case in brief are that the assessee filed return of income on 12.02.2017, declaring total income of Rs. Nil. The case was selected for scrutiny under CASS and notices were issued u/s 143(2) and 142(1) of the Act. The assessee had not shown any agricultural income in the preceding assessment year 2014-15, but has shown net agricultural income of Rs.24,12,200/- in the subject AY. The case was converted to complete scrutiny with approval of the PCIT, Valsad. After obtaining information from Department of Agricultural Economics, Junagadh University, Junagadh and after hearing the assessee, the AO accepted agricultural income of Rs.46,980/- and disallowed Rs.23,65,220/-. The AO also found that there was difference between the value as per stamp duty authority and purchase consideration of property bought by the assessee along with 7 co-purchasers. The AO, therefore, added 1/8th of the difference of Rs.93,17,447/-, i.e., Rs.11,64,680/- u/s 56(2)(vii)(b) of the Act. The AO also added Rs.31,35,000/- towards unexplained cash deposit in the bank account of assessee, maintained with Axis bank and ICICI bank. He also disallowed exempt income of Rs.14,00,900/- claimed u/s 10(10D) of the Act. In the result, total income was determined of Rs.80,65,800/- as against the returned income of Rs. Nil. 3 ITA No.728/SRT/2024/AY.2015-16 Kundanben Maheshchandra Gor 4. Aggrieved by the order of AO, the assessee filed appeal before the CIT(A). the CIT(A) issued a notice on 22.12.2018. The assessee did not respond to the said notice. Thereafter, the CIT(A) decided the appeal on the basis of materials available on record and upheld all the four additions made by the AO. The appeal was accordingly dismissed. 5. Aggrieved by the order of CIT(A), the assessee filed appeal before the Tribunal. The learned Authorized Representative (ld. AR) of the assessee submitted that the CIT(A) has issued only one notice on 22.12.2018. Thereafter, he had not given any opportunity to the assessee and passed the order by dismissing appeal of the appellant. He submitted that adequate and reasonable opportunity was not granted by the CIT(A) and the order is clearly violative of the principles of natural justice. He requested that one more opportunity may be given to the assessee to plead his case on merit. 6. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue submitted that the Bench may decide the applications, as it thinks fit. 7. We have heard both parties and perused the materials available on record. We find that the CIT(A) has issued only one notice on 22.12.2018 and proceeded to decide the appeal on the basis of the details available on record. The ld. AR submitted that all details are available with the appellant and one more opportunity may be granted to the appellant to plead its case on merit. 4 ITA No.728/SRT/2024/AY.2015-16 Kundanben Maheshchandra Gor We find that impugned order passed by the CIT(A) is clearly violative of the principles of natural justice. The principles of natural justice require that the affected party is granted sufficient opportunity of being heard to present his case. Therefore, without delving deeper into the merits of the case, in the interests of justice, we restore the matter back to the file of CIT(A) for fresh adjudication and pass a speaking order after affording sufficient and reasonable opportunity of being heard to the assessee. The assessee is directed to furnish relevant details and documents before the CIT(A). 8. In the result, appeal of the assessee is allowed for statistical purpose. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 29/05/2025. Sd/- Sd/- (SANJAY GARG) (BIJAYANANDA PRUSETH) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat Ǒदनांक/ Date: 29/05/2025 SAMANTA Copy of the Order forwarded to: 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat "