SHRI GIRIRAJ PLY N BOARD INDUSTRIES LTD.,AHMEDABAD V. THE ITO, WARD-2(1)(1) NOW WARD-4(1)(1), VADODARA

ITA 1234/AHD/2025

AI Insights

The case involves Shri Giriraj Ply N Board Industries Ltd., the appellant, contesting an order from the Commissioner of Income Tax (Appeals) which sustained the Assessing Officer's decision. The primary contention was the improper conversion of a limited scrutiny assessment into a complete scrutiny without the necessary permissions, leading to additions under section 41(1) of the Income Tax Act concerning remission of trade liability. The appellant argued that the issues scrutinized were beyond the scope of the original limited scrutiny parameters and that the assessment was conducted without adhering to the principles of natural justice and equity.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714278 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2016-2017
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRATEEK SHARMA
• Assessee Lawyers: ANIL KSHATRIYA
• Keywords: Principle of natural justice

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE DR. B.R.R. KUMAR, VICE-PRESIDENT SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER ITA No.1234/Ahd/2025 (Assessment Year: 2016-17) Shri Giriraj Ply N Board Industries Ltd., G-6, Word Business House, Near Parimal Garden, Elis Bridge, Ahmedabad-380006. [PAN :AABCG2319 Q] Vs. Income Tax Officer, Ward-2(1)(1), Vadodara. (Now Ward-4(1)(1)) Ahmedabad. (Appellant) .. (Respondent) Appellant by : Shri Anil Kshatriya with Shri Alay Anil Kshatriya, ARs Respondent by: Shri Prateek Sharma, Sr. DR Date of Hearing 06.08.2025 Date of Pronouncement 07.08.2025 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:- Delay Condoned This appeal is filed by the Assessee against the appellate order dated 21.06.2024 passed by the Commissioner of Income Tax (Appeals) Mumbai/National Faceless Appeal Centre, Delhi, relating to the Assessment Year 2016-17. 2. The assessee has raised the following grounds of appeals: (1) That the case of the appellant although was selected for limited scrutiny to verify the issues viz. (a) whether unsecured loans are genuine and from disclosed sources & (b) whether sundry creditors are genuine; however, the Printed from counselvise.com ITA No. 1234/Ahd/2025 Shri Giriraj Ply N Board Industries Ltd Vs. ITO Asst. Year : 2016-17 - 2– A.O. has travelled beyond jurisdiction by converting into complete scrutiny by scrutinizing the other issue and making addition on account of remission of trade liability u/s.41(1) of the Act of Rs.26,95,613/-, such issue was not within the parameter of limited scrutiny, besides, as a matter of fact, on account of identified issues, the A.O. has not made any addition in the hands of the appellant. (2) That when the assessment is made by the A.O. as complete scrutiny, there is not a whisper in the assessment order as to the prior permission of the PCIT having been obtained allowing the A.O. for conversion of limited scrutiny into complete scrutiny, in violation of mandatory requirement of relevant CBDT instructions. (3) That the order so passed by the Ld. A.O. and being sustained by the Ld. CIT(A), NFAC, is bad in law, illegal, besides being in violation of principle of natural justice and equity as having been passed without considering the material already placed on record in form of appellant's fairly detailed written submissions dated 02.11.2018 and 13.11.2018, although being reproduced in the assessment order at para-4.2 and 4.4. (4) That the Order so passed by the Ld. CIT(A) NFAC is bad in dismissing grounds of appeal so raised before him by brushing aside the plea of the appellant further narrated at Column no. 13 of Form No. 35. 3. On going through the record, we find that the notices u/s.250 were issued on 19.01.2021, 28.04.2023, 13.09.2023, 14.12.2023 & 29.05.2024, requesting the assessee to submit certain details/clarification/ explanation to substantiate its claims. Despite various notices issued by the Ld.CIT(A), the assessee failed to submit any submissions/documents. Hence, the Ld. CIT(A) confirmed the action of the Assessing Officer by dismissing the appeal of the assessee. The Ld. Counsel for the assessee prayed that, given an opportunity, due compliances will be made and all the details/clarification/explanation would be provided to the revenue authorities. Hence, in the interest of justice the matter is remanded to the Ld. CIT(A) for conducting assessment de-novo. The assessee shall submit all the relevant bank Printed from counselvise.com ITA No. 1234/Ahd/2025 Shri Giriraj Ply N Board Industries Ltd Vs. ITO Asst. Year : 2016-17 - 3– statement/submission/document before the Ld. CIT(A) and comply with the notices issued by the revenue authorities without seeking any unnecessary adjournments. 4. In the result, the appeal of the assessee is allowed for statistical purposes. The order is pronounced in the open Court on 07.08.2025. Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT (True Copy) Ahmedabad; Dated 07.08.2025 MV आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, True Copy सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad Printed from counselvise.com "