LAVANGA SREENIVAS,NARSAPUR V. ACIT., CENTRAL CIRCLE-2(4), HYDERABAD

ITSSA 971/HYD/2025

AI Insights

The case involves Shri Lavanga Sreenivas, the appellant, who contested an order by the Learned Commissioner of Income Tax (Appeals)-12, Hyderabad, which upheld an addition of \\u20b933,59,600 as unexplained investment under Section 69 of the Income-tax Act, 1961. The addition was initially based on a loose sheet of paper found during search proceedings on a third party, without direct evidence linking the assessee to the investment. The assessee's appeal to the CIT(A) was dismissed for non-prosecution, leading to the current appeal before the Tribunal. The Tribunal, considering the principles of natural justice and the circumstances presented by the assessee, decided to remand the case for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 780058 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 10-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2019-2020
• Appeal Filed On: 31-05-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SCHIN KUMAR
• Assessee Lawyers: A.V.RAGHURAM
• Keywords: Opportunity of being heard; Unexplained investment; Principle of natural justice
• Section: 69

Judgement Text

" ITA No 971 of 2025 Lavanga Sreenivas Page 1 of 4 आयकर अपीलȣय अͬधकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ DB-B ‘ Bench, Hyderabad Įी ͪवजय पाल राव, उपाÚ य¢ एवं Įी मधुसूदन सावͫडया, लेखा सदè य क े सम¢ । Before Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia, Accountant Member आ.अपी.सं /IT(SS)A No.971/Hyd/2025 (िनधाŊरण वषŊ/Assessment Year: 2019-20) Shri Lavanga Sreenivas Narsapur, MEDAK PAN:ABNPL3271A Vs. Assistant CIT Central Circle 2(4) Hyderabad (Appellant) (Respondent) िनधाŊįरती Ȫारा/Assessee by: Advocate A.V. Raghuram राज̾ व Ȫारा/Revenue by: Dr. Schin Kumar, Sr. DR सुनवाई की तारीख/Date of hearing: 08/10/2025 घोषणा की तारीख/Pronouncement: 10/10/2025 आदेश/ORDER Per Madhusudan Sawdia, A.M.: This appeal is filed by Shri Lavanga Sreenivas (“the assessee”), feeling aggrieved by the order pass by the Learned Commissioner of Income Tax (Appeals)-12, Hyderabad (“Ld. CIT(A)\") dated 06.03.2025 for the A.Y 2019-20. 2. The assessee has raised the following grounds of appeal: “1. The learned Commissioner of Income Tax (Appeals) erred in law and on facts in upholding the addition of ₹33,59,600/- as unexplained investment under Section 69 of the Income- tax Act, 1961, based merely on conjectures and surmises, Printed from counselvise.com ITA No 971 of 2025 Lavanga Sreenivas Page 2 of 4 without any corroborative evidence or substantiated facts on record. 2. The learned CIT(A) failed to appreciate that the addition was based solely on a loose sheet of paper allegedly found during search proceedings conducted on a third party, without any corroborative or independent evidence. 3. The learned CIT(A) failed to appreciate the fact that the Appellant was not even provided with the alleged material based on which the addition was made, thus depriving the Appellant of an effective opportunity to rebut the same and resulting in a gross violation of principles of natural justice. 4. The learned CIT(A) confirmed the impugned addition without exercising powers under Section 250(4) of the Act to make further inquiries or direct verification, thereby violating the principles of natural justice and prejudicing the Appellant’s case. 5. The order passed by the learned CIT(A) is non-speaking and defective, in breach of the mandatory provisions of Section 250(6) of the Act, as it fails to clearly set out the points for determination, the decision thereon, and the reasons for such decision, thereby rendering the appellate order untenable in law. 6. The appellant craves to alter, amend and modify any ground of appeal.” 3. The brief facts of the case are that the assessee had filed an appeal before the Ld. CIT(A) against the order of the Learned Assessing Officer (“Ld. AO”) passed under section 153C of the Income Tax Act, 1961 (“the Act”) dated 01.03.2024 for the assessment year 2019–20. During the appellate proceedings before the Ld. CIT(A), the assessee, however, could not respond to the notices issued by the appellate authority. Consequently, the Ld. CIT(A) dismissed the appeal for non-prosecution, thereby upholding the assessment order passed by the Ld. AO. 4. Aggrieved by the said order of the Ld. CIT(A), the assessee has preferred the present appeal before this Tribunal. The Learned Authorised Representative (Ld. AR) submitted that due to Printed from counselvise.com ITA No 971 of 2025 Lavanga Sreenivas Page 3 of 4 unavoidable circumstances, the assessee could not comply with the notices issued by the Ld. CIT(A). It was contended that the assessee had no mala fide intention to delay the proceedings or avoid the appeal hearing. It was further submitted that the assessee would not gain anything by non-prosecution of his own appeal and prayed that, in the interest of natural justice, one more opportunity may be granted to the assessee to represent his case before the authorities. The Ld. AR therefore prayed that the matter may be restored to the file of the Ld. CIT(A) for adjudication of the issue on merits after granting adequate opportunity of being heard to the assessee, with liberty to file necessary evidence and submissions in support of his claim. 5. Per contra, the Learned Departmental Representative (“Ld. DR”) objected to the remand of the matter and contended that sufficient opportunities had already been provided by the lower authorities which the assessee failed to avail. However, in the alternate, the Ld. DR submitted that if the issue is to be remanded, it may be remanded to the file of the Ld. AO for fresh adjudication, since the matter has not been prosecuted on merits before the Ld.AO also. 6. We have considered the rival submissions and perused the material available on record. It is observed that the Ld. CIT(A) dismissed the appeal for non-prosecution on the part of the assessee. However, the Ld. AR has submitted that due to unavoidable circumstances, the assessee could not comply with the notices issued by the Ld. CIT(A). It was contended that the assessee had no mala fide intention to delay the proceedings or avoid the appeal hearing. It was further submitted that the assessee would Printed from counselvise.com ITA No 971 of 2025 Lavanga Sreenivas Page 4 of 4 not gain anything by non-prosecution of his own appeal and prayed that, in the interest of natural justice, one more opportunity may be granted to the assessee to represent his case before the authorities. Therefore, considering the principle of natural justice, we are of the opinion that the assessee deserves one more opportunity to present his case. Accordingly, we restore the matter to the file of the Ld. AO for de novo adjudication after affording adequate opportunity of being heard to the assessee. The assessee is also directed to extend full cooperation in the assessment proceedings and not to seek unnecessary adjournments. The Ld. AO shall, after considering the evidence and submissions that may be filed by the assessee, pass a fresh assessment order in accordance with law. 7. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 10th October, 2025. Sd/- Sd/- (VIJAY PAL RAO) VICE PRESIDENT (MADHUSUDAN SAWDIA) ACCOUNTANT MEMBER Hyderabad, dated 10th October, 2025 Vinodan/sps Copy to: S.No Addresses 1 Shri Lavanga Sreenivas, 3-43/8/B Sri Ram Nagar Colony, Narsapur, Medak 502313 2 Asstt. CIT, Central Circle 2(4), Aayakar Bhavan, Basheerbagh Hyderabad 500084 3 Pr. CIT – Central, Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File By Order Printed from counselvise.com "