PARMAR SHELTERS & INFRA PVT. LTD.,CHENNAI V. ITO, CORPORATE WARD-5(1), CHENNAI

ITA 36/CHNY/2025

AI Insights

The case involves M/s. Parmar Shelters & Infra Private Limited, which appealed against the order of the CIT(A) confirming the assessment made by the Income Tax Officer for the Assessment Year 2015-16. The primary contention was regarding the disallowance of Rs. 2,28,23,485 as non-genuine expenditure and an addition of Rs. 4,56,470 as unexplained expenditure under section 69C of the Income Tax Act. The Income Tax Officer had reopened the assessment based on information that the assessee had taken accommodation entry from a shell company. The CIT(A) confirmed the disallowance without a detailed examination, leading to the present appeal. The Tribunal found that the assessee was not adequately represented in the earlier proceedings and thus decided to set aside the CIT(A)'s order and remand the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 472192 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMANTHA MULLAMUDI
• Assessee Lawyers: ANANDD BABUNATH
• Keywords: Set aside; Unexplained expenditure; Principle of natural justice
• Section: 147; 144; 69C

Judgement Text

" आयकर अपीलीय अिधकरण, ‘ए’ \u000fा यपीठ, चे\u0014ई IN THE INCOME TAX APPELLATE TRIBUNAL , ‘A’ BENCH, CHENNAI \u0016ी मनु क ुमा र िग\u001bर ,\u000fा ियक सद एवं \u0005ी अिमता भ शु#ा , लेखा सद यक े सम\u0011 BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A.No.36/Chny/2025 (िनधा\u0005रण वष\u0005 / Assessment Year: 2015-16) M/s. Parmar Shelters & Infra Private Limited, No.1, Pandaram Street, Purasaiwalkam, Chennai-600 007. Vs Income Tax Officer, Corporate Ward-5(1) Chennai. PAN : AAGCP-0273-K (अपीलाथ\u000f/Appellant) (\u0010\u0011यथ\u000f/Respondent) अपीलाथ\u000fक\u0014ओरसे/ Appellant by : Mr. Anandd Babunath, CA \u0010\u0011यथ\u000fक\u0014ओरसे/Respondent by : Mrs.Samantha Mullamudi, Addl. CIT सुनवाईक\bतारीख/Date of hearing : 25.03.2025 घोषणाक\bतारीख /Date of Pronouncement : 01.04.2025 आदेश आदेश आदेश आदेश / O R D E R PER MANU KUMAR GIRI, JM: The captioned appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals)(NFAC) Delhi [CIT(A)] dated 18.12.2024 for Assessment Year 2015-16. 2. Brief facts are as under: The assessee company is engaged in the business of dealing in commodities and goods which are used in infrastructure development as well as rendering services in connection with infra development filed its return of income for AY 2015-16 on 27.09.2015 admitting total income of Rs.1,06,96,360/-. The AO noted that as per information from DCIT, Central Circle-3(3), Kolkata, during the 2 ITA No. 36 /Chny/2025 year under consideration, the assessee had taken accommodation entry from M/s. Bridge & Building Construction Company P. Ltd. for Rs.2.28 crores, which was a shell company managed by Shri Ajit Kumar Jindal. Therefore, the AO reopened the assessment by issuance of notice dated 13.04.2021 u/s.148 of the Act. Though the assessee submitted its reply, the AO was not convinced with the same. Further, the AO issued notices u/s.133(6) dated 27.4.2023 and 03.05.2023 to M/s. Bridge & Building Construction Company P. Ltd to verify genuineness of transactions with the assessee. However, no reply has been furnished by M/s. Bridge & Building Construction Company P. Ltd. The AO was of the view that due to non-submission of requisite details by the above mentioned entity, the expenditure claimed by the assessee cannot be accepted. Hence, AO disallowed Rs.2,28,23,485/- on account of non-genuine expenditure and further made an addition of Rs.4,56,470/-on account of unexplained expenditure u/s 69C of the Act. 3. On appeal, Assessee challenged the order of assessment u/s 147 r.w.s 144 read with section 144B of the Act before the ld.CIT(A), who proceeded ex-parte and confirmed the order of the AO on merits. Aggrieved by the order of Ld.CIT(A), assessee is in further appeal before us. 3 ITA No. 36 /Chny/2025 4. Before us, the ld. Counsel for assessee submitted that the CIT(A) has sent the notices which were not received by the assessee, hence the assessee was prevented from appearance on the purported dates. Therefore, he prayed that the assessee may be provided an adequate and proper representation time to file evidence and documents, if any, to substantiate his explanation regarding additions made. The ld.DR stated that the assessee has defaulted in appearing before the appellate authority hence no lenient view is to be taken in this case and prayed for dismissal of appeal. 5. We have heard both the parties and perused material on record. Though we concur with the submissions of Ld. Sr. DR, however, keeping in mind the principle of natural justice and grant another opportunity of hearing to the assessee. We also find that assessee has not represented before the ld.CIT(A) despite notices for the reasons stated above. Accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. CIT(A) for denovo appeal hearing after affording proper opportunity of hearing to the assessee subject to cost of Rs.5,000/- which shall be deposited by the assessee within 30 days from the date of receipt of this order to ‘Tamil Nadu State Legal Services Authority’ at Hon’ble High Court of Madras. The proof of the same will be furnished by the 4 ITA No. 36 /Chny/2025 Assessee before Ld.CIT(A) whose shall proceed for fresh appeal hearing after affording proper opportunity of hearing to the assessee. The assessee is directed to substantiate its case with all evidence and documents regarding additions made by AOif any, forthwith without any fail, failing which Ld. CIT(A) shall be at liberty to proceed with the appeal proceedings as per law. The ld. AR, who appeared also assured the bench that he will ensure that the assessee will prosecute his case diligently before the ld.CIT(A). 6. In the result, appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 1st April, 2025 Sd/- Sd/- (अिमताभ शु#ा) ( मनु क ुमार िग\u001bर) ( Amitabh Shukla ) ( Manu Kumar Giri) लेखा लेखा लेखा लेखा सद\u0003य सद\u0003य सद\u0003य सद\u0003य / Accountant Member \u000fाियक सद / Judicial Member चे\u0019ई/Chennai, \u001bदनांक/Date: 01.04.2025 DS आदेश क\u0007 \bितिलिप अ\u000eेिषत/Copy to: 1.Appellant 2.Respondent 3. आयकर आयु\u0013/CIT Chennai/Madurai 4. िवभागीय \bितिनिध/DR 5. गाड फाईल/GF. "