SATISH KUMAR & SONS(HUF),NEW DELHI V. WARD-47(1) JURISDICTIONAL ASSESSING OFFICER, NEW DELHI

ITA 5112/DEL/2025

AI Insights

The case involves Satish Kumar & Sons (HUF), who appealed against the order of the CIT(A) which was passed ex parte, dismissing their appeal against an assessment order that added Rs. 45,86,542 as non-genuine business expenditure under section 69C r.w.s. 115BBE of the Income Tax Act, 1961. The assessee argued that they were not given an effective opportunity of hearing as the notices were allegedly not received. The Tribunal, after reviewing the circumstances and the principles of natural justice, decided to set aside the CIT(A)'s order and remand the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 822738 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2018-2019
• Appeal Filed On: 22-08-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANKUSH KALRA
• Assessee Lawyers: SHANTANU
• Keywords: Set aside; Business expenditure; Onus to prove; Principle of natural justice
• Section: 148; 142(1); 69C

Judgement Text

" 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’: NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI RAJ KUMAR CHAUHAN, JUDICIAL MEMBER ITA No.5112/Del/2025, A.Y. 2018-19 Satish Kumar & Sons (HUF) H.No.3 East Avenue Road, East Punjabi Bagh, New Delhi PAN: AAJHS1606M Vs. Jurisdictional Assessing Officer Ward-47(1), D.S.Building New Delhi (Appellant) (Respondent) Appellant by Sh. Shantanu, CA Respondent by Ms. Ankush Kalra, Sr. DR Date of Hearing 11/12/2025 Date of Pronouncement 24/12/2025 O R D E R PER RAJ KUMAR CHAUHAN (J.M.): 1. This appeal is filed by the assessee /appellant against the order of Learned Commissioner of Income Tax (Appeals) / National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as the “CIT(A)”], passed under section 250 of the Income Tax Act, 1961 [hereinafter Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 2 referred to as “the Act”] dated 24.07.2025 for the A.Y. 2018-19, whereas the appeal of the assessee against assessment order dated 20.03.2023 was dismissed while deciding the same ex parte. 2. The brief facts giving rise to this appeal are that the appellant/assessee is engaged in the business of processing and selling pulses. The return of income for the year under consideration was submitted under section 139(1) of the Act on September 13, 2018 declaring a profit of Rs. 26,17,085/-. Later on, the Assessing Officer issued a notice under section 148 A(b) of the Act for the year 2018-19, proposing to initiate action u/s 148 of the act on account of information in possession suggesting escape of income on account of the alleged accommodation entry amounting to Rs. 45,86,542/-. In compliance of the order under section 148A(d) of the Act, the appellant/assessee had filed return of income on 17.04.2022. The assessment unit issued a statutory notices u/s 142(1) and 143(2) of the Act and show cause notices were issued during the assessment proceedings and assessment order under section 147/ 144B was passed by making addition of Rs. 45,86,542/- u/s 69C r.w.s. 115BBE of the Act, treating the transactions as non-genuine, therefore, inadmissible as business expenditure. Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 3 3. Aggrieved by the said order, the assessee filed appeal before the Ld. CIT(A) who has dismissed the same ex parte. Hence, aggrieved by the impugned ex parte order, the assessee is in appeal before us and has raised various grounds of appeal as mentioned in Form 36. 4. We have heard the ld. AR and Ld. DR and examined the record. At the very outset, the Ld. AR submitted that the impugned order is ex parte, as no effective opportunity of hearing was given and the purported notices issued on four dates were never received by the assessee. Therefore, the Ld. AR prayed for setting aside the impugned order by restoring the matter to the file of the Ld. CIT(A) for deciding afresh. 5. The Ld. DR fairly submitted that the impugned order is ex parte and Ld. Tribunal may in its discretion, if deems fit may restore the matter to the file of the Ld. CIT(A) for fresh adjudication. 6. We have considered the rival submissions and the material observation of the Ld. CIT(A) contained in para no. 7 which shows that the impugned order has been passed ex parte without affording effective opportunity of hearing which is evident from para 7 of the impugned order extracted below as under: Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 4 “7. Discussion, Reason & Decision: The following notices of hearing are issued and served on the email address of appellant as under: S. No. Date of issue Compliance date Remarks 1. 26.10.2023 13.11.2023 The appellant did not respond 2. 04.10.2024 21.10.2024 The appellant did not respond. 3. 16.04.2025 25.04.2025 The appellant filed adjournment on 29.04.2025 4. 29.04.2025 14.05.2025 The appellant did not respond. There was no compliance on the part of the appellant after filing of first appeal and no communication was received form the appellant during course of this appellate proceeding till date except one adjournment dated 29.04.2025. In view of the facts and circumstances mentioned hereinabove it is legitimate to infer that the appellant is not interested in the prosecution of the appeal. ……………………………………………………. In view of the facts and legal position discussed above, it is seen that appellant is not interested in pursuing the appeal and not having any documents, explanation and evidence in support of grounds of appeal raised and thus has not discharged onus to prove the genuineness of the fact raised in grounds of appeal. It is seen that the appellant has filed Statement of facts/Grounds of appeal along with Form 35, but no written submission has been filed till date. Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 5 I have carefully gone through the grounds of appeal, statement of facts, assessment order and other material on record. In response to notice of hearing issued, the appellant has not made any submissions to corroborate the Grounds of Appeal. The appellant has not submitted any documentary evidences during the Appellate proceedings. The appellant has not uploaded even a single document in response to the above notices, in spite of multiple hearing opportunities (as above). The appellant failed to substantiate the claims made in grounds of Appeal andthere is nothing available on record to rebut the Assessing Officer's findings on merits. The appellant has not produced any material to controvert the finding of A O. Further, from the above mentioned conduct of the appellant, it is clear that the appellant is not interested in prosecuting its appeal. As no details are uploaded by the appellant, there is nothing available on record to rebut the Assessing Officer's findings on merits. No purpose would be served by keeping this appeal pending. As per the details available on record, there is nothing to controvert the findings of the AO and therefore, all the grounds raised in appeal are hereby dismissed. In the event, I have no reason to interfere with the findings of the AO. Hence, the order of the Assessing Officer is confirmed and the appeal is dismissed. 8. In result, appeal filed by the appellant is \"dismissed\".” 7. Section 250 sub section 2(a) of \"the Act\" provides as under: “Section 250 (2) The following shall have the right to be heard at the hearing of the appeal: - a. The appellant, either in person or by an authorized representative;” 8. It is evident from the provision that the hearing to be given is not a formality but an effective hearing is sine qua non for the purpose of upholding the principal of natural justice. 9. It is evident from the contents of the impugned order as extracted above that no effective opportunity of hearing has been given to the assessee Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 6 which violates the principle of natural justice has thus resulted into miscarriage of justice. We have noticed that the impugned order is ex parte as there is no evidence to show that the notice sent on four occasions were served upon the assessee. It is thus clear that the Ld. Lower Authorities has passed the order without effective representation of the assessee and has thus failed in giving effective opportunity of hearing at the time of passing of the impugned order. For these reasons the impugned order is not sustainable and is accordingly set aside. The matter is accordingly restored to the file of the Ld. CIT(A) for deciding the matter de novo after giving an effective opportunity of hearing. 10. In the result, the appeal of the assessee is accordingly allowed as above terms for statistical purposes. Order pronounced in open Court on 24th December, 2025. Sd/- Sd/- (S. RIFAUR RAHMAN) (RAJ KUMAR CHAUHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 24/12/2025 Binita, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT/PCIT 4. CIT(Appeals) Printed from counselvise.com ITA No. 5112/Del/2025 Satish Kumar & Sons 7 5. Sr. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "