RAJIV KUMAR CHOUDHARY,BAREILLY V. INCOME TAX OFFICER, WARD - 3(2)(4), MUZAFFARNAGAR, MUZAFFARNAGAR

ITA 3411/DEL/2025

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The case involves Rajiv Kumar Chaoudhary, a government employee, who appealed against the order of the National Faceless Appeal Centre (NFAC) which had dismissed his appeal for want of prosecution. The original assessment was reopened under section 147 of the Income Tax Act, 1961, leading to an addition of Rs. 47,81,600 as unexplained income. The assessee contended that his absence during the proceedings was due to severe back pain and his duties during the Kumbh Mela, which prevented him from responding to notices and attending hearings. The Tribunal noted that the NFAC had not decided the appeal on merits but dismissed it for want of prosecution, which was not in accordance with the provisions of section 250(6) of the Act.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 778827 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2016-2017
• Appeal Filed On: 24-05-2025
• Other Referred Cases: Collector, Land Acquisition v. MST Katiji
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHYAM MANOHAR SINGH
• Keywords: Set aside; Opportunity of being heard; Reasonable cause; Reassessment proceedings; Principle of natural justice
• Section: 147; 148; 69

Judgement Text

" 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “E”, DELHI BEFORE SH. SUDHIR KUMAR, JUDICIAL MEMBER AND SH. MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.3411/DEL/2025 Assessment Year: 2016-17 Rajiv Kumar Chaoudhary, 141, Utsav Part-2, Mahanagar Pilbhit Road, Bareilly 243006 Uttar Pradesh Bareilly PAN No.AFTPC3123Q Vs. ITO Ward- 3 (2)(4) Muzaffarnagar (APPELLANT) (RESPONDENT) Appellant by None Respondent by Sh. Shyam Manohar Singh Sr. DR Date of hearing: 24/09/2025 Date of Pronouncement: 17/10/2025 ORDER PER SUDHIR KUMAR, JUDICIAL MEMBER: This appeal by the assessee is directed against the order of the National Faceless Appeal Centre (in short “NFAC”) vide order dated 17.02.2025 arising out of the assessment order dated 08.03.2024 pertaining to A.Y. 2016-17. Printed from counselvise.com 2 2. The appeal is filed time barred by 24 days. An application has filed by the assessee to condone the delay in filing the appeal. The contention of the assessee is that the assessee is a government employee and due to the Kumbh Mela duty at Prayagraj he could not file the appeal with in time. Reliance has placed case of Collector, Land Acquisition v. MST Katiji 167 ITR page 471. The assessee has shown the sufficient cause not to file the appeal within time. Therefore, we condoned the delay and admit the appeal for adjudication. 2. The assessee has raised the following grounds in appeal: BECAUSE the appellant was suffering from severe back pain and weakness due to prolonged illness, rendering him bedridden from October 2024 to January 2025, he was unable to check his email or inform his counsel about the notices issued by CIT(A) regarding the hearing of his appeal. Consequently, an ex-parte appellate order was passed against him. Due to this reasonable cause, which prevented the appellant from appearing during the appellate proceedings, accordingly the impugned order passed by CIT(A) be set aside, and the matter be directed for fresh adjudicated by this Hon’ble Court. 2. BECAUSE the appellant had entrusted his brief to his previous counsel based in Bareilly, who duly responded to the notice issued under Section 148A(a) of the Act, the appellant—being stationed at Aligarh due to official duties—was under the bona fide belief that his counsel would continue responding to subsequent notices. However, Printed from counselvise.com 3 due to a communication gap, no compliance was made, leading to the ex-parte assessment order passed by the learned Assessing Officer. This resulted in a substantial addition of Rs.47,81,600/-, which was later affirmed by the CIT(A) in the impugned ex-parte appellate order dated 17.02.2025. Given the lack of adherence to the principles of natural justice, the impugned order deserves to be set aside and the matter be directed for reconsidered afresh. 3. BECAUSE the appellant was prevented by a reasonable cause from responding to the notices issued during both the assessment and appellate proceedings, he was deprived of a fair opportunity to be heard before the passing of the assessment order as also impugned appellate order dated 17.02.2025. This constitutes a violation of the principles of natural justice. Accordingly, it is respectfully submitted that the impugned appellate order deserves to be set aside for fresh adjudication. WITHOUT PREJUDICE TO THE AFORESAID 4. BECAUSE from the bare perusal of the notice dated 02.03.2023 issued under section 148A(b) it is apparent that the same has been issued on the basis of information flagged by the Directorate of Income Tax (Systems), CBDT in accordance with the risk management strategy formulated by the Board as per the provisions clause (i) of Explanation 1 to Section 148 of the Income Tax Act, 1961, although the said flagging has been omitted from the Finance Act 2022, on this ground only the proceedings under section 148A/147 against the petitioner in consequence of such notice is void-ab-initio and is liable to be quashed. 5. BECAUSE the approval dated 20.03.2023 granted by the hon’ble PCCIT, UP (West) & Uttarakhand under section 151(ii) of the Act, is Printed from counselvise.com 4 wholly mechanical without his due application of mind and the same having been granted in a routine manner. 6. BECAUSE the objections made by the petitioner vide letter filed on 21.02.2023 in compliance to the notice issued under section 148A(a) of the Act has been brushed aside without on the premise that “the reply of the assessee on the above points is not acceptable as his income during the year was above the threshold limit for filing ITR, but he failed to file ITR”, the order dated 22.03.2023 passed under section 148A(d) alongwith notice dated 22.03.2023 issued under section 148 of the Act are incomplete violation of principals of natural justice. 7. BECAUSE the Assessing Officer has grievously erred in law as well as on facts in considering the case of the petitioner as fit case for invoking reassessment proceedings under section 147 of the Act by issuance of notice under section 148, by erroneously treating the agricultural receipts of the family which was deposited in the bank accounts of the appellant as alleged income which has escaped from assessment. 8. BECAUSE the notice dated 22.03.2023 issued under section 148 of the Act by the ld. Income Tax Officer, Ward - 3(2)(4), Muzaffarnagar (Jurisdictional Assessing Officer) itself is without jurisdiction as the same is in complete violation of the Notification No. 18 of 2022 dated 29.03.2022 issued by the CBDT. 9. BECAUSE the appellant having duly explained the source of cash deposit in his bank accounts at the time of inquiry under section 148A of the Act the denial of the same by the ld. Assessing Officer while passing the ex-parte assessment order dated 08.03.2024 as alleged Printed from counselvise.com 5 unexplained money liable for taxation under section 69 r.w.s. 115BBE of the Act was wholly erroneous and the same having been confirmed by the CIT(A) in the impugned ex-parte appellate order dated 17.02.2025 is also erroneous and bad. 10. BECAUSE the entire cash deposit in the bank account of the appellant during the year relates to agriculture income which is exempted from tax and the same having been disclosed in the return filed in compliance to the notice issued under section 148 of the Act, the ld. Assessing Officer without giving any adverse finding on the same, the entire addition of Rs.47,81,600/- is was bad in law and the same was not liable to have been sustained by the CIT(A) in the impugned ex-parte appellate order dated 17.02.2025 passed by him. 11. BECAUSE the order appealed against, is contrary to facts, law and principles of natural justice. 3. The brief facts of the case are that the assessee is an individual and not filed the return of income for the A.Y.2016-17. The case of the assessee was reopened u/s 147 of the Act and notice under section 148 dated 22-03- 2023 was issued to the assessee. In the response of the notice the assessee filed his return of income declaring total income of Rs.6,47,860/-. Further notices u/s 143(2) and 141(1) of the Act were issued to the assessee. The assesse did not comply the notices. According to Assessing Officer the assessee deposited the amount to the tune of Rs.47,81,600/- in different Banka account maintained with bank of Baroda, ICICI bank Limited and HDFC Bank Printed from counselvise.com 6 Limited. The AO completed the assessment in the absence of the books of accounts, making the addition of Rs.47, 81,600/- as unexplained income u/s 69A of the Act. 4. Aggrieved the order of the AO the assessee filed the appeal before the Ld. NFAC, who vide his order dated 17- 02-2025 dismissed the appeal against which the assessee is in appeal before the Tribunal. 5.None appeared on behalf of the assessee. Therefore, this appeal is being decided on the basis of material available on record and after hearing the Ld. DR. 6. We have heard the Ld. DR and perused the material available on record. It is admitted fact that despite opportunities granted by the AO as well as the Ld. NFAC the assessee did not appear before either of the authorities for which ex-party orders have been passed by the AO as well as the Ld. NFAC. However, the Ld. NFAC in the instant case has not decided the appeal on merit which he was supposed to as per the provisions of section 250(60 of the Act, which reads as under: “The order of the Deputy Commissioner (Appeals) or, as the case may be, the commissioner (Appels) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon, and the reason for the decision.” Printed from counselvise.com 7 7. Since in the instant case the Ld. NFAC has simply dismissed the appeal for want of prosecution and has not decided the appeal on merits, therefore, considering the totality of the facts and circumstances of the case in the interest of justice, we deem fit it proper to restore the issue to the file of the Assessing Officer with a direction to grant one final opportunity to the assessee to substantiate its claim and decide the issue as per fact and law and pass the appropriate order on merit. The assessee also directed to appear before the AO and substantiate its claim without seeking any adjournment. The grounds raised by the assessee are accordingly allowed for statistical purposes. 8. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 17/10/2025. Sd/- Sd/- (MANISH AGARWAL) (SUDHIR KUMAR) ACCOUNTANT MEMBER (JUDICIAL MEMBER) NEHA, Sr. PS Date:17.10.2025 Copy forwarded to: 1. Appellant Printed from counselvise.com 8 2. Respondent 3. CIT 4. CIT(Appeals) ` 5. DR: ITAT ASSISTANT REGISTRAR ITAT DELHI Printed from counselvise.com "