SONAL MODI,KOLKATA V. ITO, CIRCLE 36(1), , KOLKATA

ITA 1023/KOL/2025

AI Insights

Sonal Modi appealed against the order of the Commissioner of Income Tax (Appeals) which upheld the additions made by the Assessing Officer regarding unexplained investments and income not offered to tax for the Assessment Year 2015-16. The Tribunal noted that the CIT(A) had not provided a reasoned decision as required under section 250(6) of the Income Tax Act, 1961, and that the assessee had not been given a fair opportunity to present her case due to her personal circumstances at the time. The Tribunal decided to remand the case back to the Assessing Officer for a fresh assessment, ensuring that the assessee is given a reasonable opportunity to be heard.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772208 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2015-2016
• Other Referred Cases: Ajji Basha Vs. CIT (2019) 111 taxmann.com 348 (Madras)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Condonation of delay; Set aside; Opportunity of being heard; Reasonable cause; Reassessment proceedings; Unexplained investment
• Section: 147; 148; 144; 142(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘D’ BENCH, KOLKATA Before SHRI GEORGE MATHAN, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi Vs. ITO, Circle 36(1), Kolkata (Appellant) (Respondent) PAN: AEPPM3814D Appearances: Assessee represented by : Siddharth Agarwal, Adv. Department represented by : Pradeep Kumar Biswas, Sr. DR Date of concluding the hearing : 04-August-2025 Date of pronouncing the order : 28-August-2025 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2015-16 dated 11.03.2025, which has been passed against the assessment order u/s 147 r.w.s. 144 of the Act, dated 22.03.2022. 1.1 Along with the appeal memo, the assessee has filed an affidavit seeking condonation of delay of two days, even though the Registry has not pointed out any such delay. It is submitted that the assessee was unaware of the appellate order as the same was never received physically and she was not accessing her email at the relevant time Printed from counselvise.com Page | 2 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi since her parents were suffering from cancer. Later on, in the 1st week of May 2025 when she accessed her email, the said ex parte order was located in the income-tax portal which had already been passed on 11.03.2025. Immediately she consulted an advocate and handed over all the relevant documents. The appeal papers were prepared by the office of the counsel, which were finally deposited in the office of the ITAT with a delay of two days. Since there is a reasonable cause for not filing the appeal within time, it has been requested that the delay of two days may be condoned. 1.1 We have considered the submission made in the affidavit filed. Since the registry has not pointed out any such delay and there is sufficient cause for the delay, if any, in filing the appeal; the same is hereby condoned and the appeal is admitted for adjudication. 2. The assessee is in appeal before the Tribunal raising the following grounds of appeal: “1. For that, on the facts and in the circumstances of the case, Ld. CIT(A) was not justified in passing an ex-parte order. 2. For that, on the facts and in the circumstances of the case, Ld. CIT(A) ought to have quashed the re-assessment order as bad in law. 3. For that the Ld. CIT(A) ought to have deleted the addition of Rs. 60,10,000/- made by the A.O. on account of interest on debentures not offered to tax. 4. For that the Ld. CIT(A) ought to have deleted the addition of Rs. 1,00,00,000/- made by the A.O. on account of alleged unexplained investments in RBI Bonds u/s 69. 5. For that the Ld. CIT(A) ought to have deleted the addition of Rs. 44,00,000/- made by the A.O. on account of alleged unexplained investments in Time Deposits u/s 69. 6. For that the Ld. CIT(A) ought to have deleted the addition of Rs.3,82,972/- made by the A.O. on account of alleged income on alleged contractual receipts of Rs. 27,35,512/-. Printed from counselvise.com Page | 3 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi 7. For that the Ld. CIT(A) ought to have deleted the addition of Rs. 2,51,470/- made by the A.O. on account of alleged interest income not offered to tax. 8. The appellant craves leave to add further grounds of appeal or alter the grounds at the time of hearing.” 3. Brief facts of the case, as mentioned in the appeal order are that the assessee is an individual and had not filed the return of income for the A.Y. 2015-16. The Assessing Officer (‘the Ld. AO’) received the information that the assessee had received interest on debentures at Rs. 60,10,000/-, Rs. 1,00,00,000/- was paid for acquiring RBI Bonds, Rs. 44,00,000/- was the investment made, besides contract receipts amounting to Rs. 3,82,972/- and interest receipts amounting to Rs. 2,51,470/- for the A.Y. 2015-16. Based on this information, the Ld. AO issued a notice u/s 148 of the Act for reassessment under section 147 of the Act. In response to the same, the assessee did not file any return of income. During the course of the reassessment proceedings, the Ld. AO issued a notice u/s 142(1) followed by a show cause notice. In response to the same also, the assessee did not file any details nor made any compliance. On perusal of the documents available with the Ld. AO, it was noticed that the assessee had made various investments and had failed to furnish the source of the said investments. Hence, the Ld. AO added a sum of Rs. 60,10,000/- interest on debentures, Rs. 1,00,00,000/- paid for acquiring RBI Bonds, Rs. 44,00,000/- made as investment, contract receipts amounting to Rs. 3,82,972/- and interest receipts amounting to Rs. 2,51,470/- to the income of the assessee for the A.Y. 2015-16 and completed the assessment ex parte u/s 147 r.w.s 144 r.w.s 144B and assessed the total income at Rs. 2,10,44,442/-, thereby raising the tax demand of Rs. 1,82,90,891/-. Aggrieved with the assessment order, the assessee preferred an appeal before the Ld. Printed from counselvise.com Page | 4 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi CIT(A), who vide the impugned order dismissed the appeal. The Ld. CIT(A) has extracted the assessment order, but as there was no compliance to the various notices issued for hearing, he upheld various disallowances/additions made and found no reason to interfere with the order of the Ld. AO and the appeal was disallowed/dismissed. 4. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal. 5. Rival contentions were heard and the submissions made have been examined. At the outset, the Ld. AR brought it to our notice that the assessee did not make any compliance either before the Ld. AO or even before the Ld. CIT(A). It was submitted that since the notices were received by email, they escaped the attention of the assessee. The assessee has filed another affidavit dated 27/05/2025 in which is it is stated that the appeal was dismissed by the Ld. CIT(A) by passing an adverse order and the assessee was not in a position to check the portal and access her email as her parents were suffering from cancer and were undergoing treatment for the same. In the 1st week of May 2025, when she accessed her email, the said order was located in the income tax portal which had already been passed on 30/05/2025. It is for the reason of illness of her parents that she could not participate in the reassessment proceedings and gives an undertaking that she shall make due compliance if the matter is restored back to the file of the lower authorities. The Ld. AR requested that the matter may be remanded to the Ld. AO for fresh assessment. The Ld. DR relied upon the order of the Ld. CIT(A) but did not oppose the request of the assessee. Printed from counselvise.com Page | 5 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi 6. We have considered the submissions made. In this respect, it is relevant to examine the provisions of section 250(6) which are reproduced as under: “250(6) – The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.” 7. Thus, section 250(6) of the Act casts a duty on the Ld. CIT(A) to pass an order in appeal which should state the points for determination and the decision as well as the reason for arriving at such decision. In the present case before us, the Ld. CIT(A) has not mentioned the reasons after examining the records while disposing of the appeal. The Ld. CIT(A) has neither adjudicated upon various grounds of appeal nor has passed a reasoned order for arriving at the decision, as is required u/s 250(6) of the Act. We further note that in Ajji Basha Vs. CIT (2019) 111 taxmann.com 348 (Madras) it has been held that a speaking order on merits with reasons and findings is to be passed by Commissioner (Appeals) on basis of ground raised in assessee's appeal; he cannot dispose the assessee's appeal merely by holding that Assessing Officer's order is a self-speaking order which requires no interference. The relevant extract from the order is as under: 6. … The first respondent is the appellate authority. Needless to state that the Appellate Authority is also a fact finding authority and therefore, he has to consider the order of assessment on the grounds raised in the appeal and thereafter, pass a speaking order on merits and in accordance with law by giving his own reasons and findings as to whether the order of assessment can be sustained or not. In other words, the order passed by the Appellate Authority should explicitly exhibit his application of mind to the facts and circumstances and the objections raised in the grounds of appeal, also by expressing his reasons and findings in support of his conclusion. 7. In this case, the Appellate Authority, after extracting the order of the Assessing Officer in full, has not given any other reason or finding to dismiss the appeal except by stating that he is of the considered view that the Assessing Printed from counselvise.com Page | 6 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi Officer's order is a self speaking order and does not call for any interference. In my considered view, such single line finding of the Appellate Authority, cannot be sustained as a proper exercise of the Appellate Authority, while disposing the appeal. Therefore, it is apparent that the order impugned in this writ petition is an outcome of total non-application of mind. Consequently, the impugned order cannot be sustained. It is further contended that before passing the order, the petitioner was not heard. 8. Since the Ld. CIT(A) has not adjudicated the appeal by passing a speaking order since no documents were filed before him and even before the Ld. AO, the assessee could not make compliance, therefore, the Bench was of the view that another opportunity needs to be granted to the assessee to make proper submission in the interest of justice. Therefore, both the orders of the Ld. AO as well as the Ld. CIT(A) are hereby set aside and the issue is remitted back to the file of the Ld. AO for making the reassessment de novo. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any submission she wants to make in support of the grounds of appeal and against the additions made and shall not seek unnecessary adjournments. Accordingly, the grounds taken by the assessee in her appeal are partly allowed for statistical purposes. 9. In the result, the appeal filed by the assessee is partly allowed for statistical purposes. Order pronounced in the open Court on 28th August, 2025. Sd/- Sd/- [George Mathan] [Rakesh Mishra] Judicial Member Accountant Member Dated: 28.08.2025 Bidhan (Sr. P.S.) Printed from counselvise.com Page | 7 I.T.A. No.: 1023/KOL/2025 Assessment Year: 2015-16 Sonal Modi Copy of the order forwarded to: 1. Sonal Modi, 14/B, EZRA STREET B.B.D. BAGH, KOLKATA - 700001 - West Bengal. 2. ITO, Circle 36(1), Aayakar Bhawan Poorva, 110, Shanti Pally, Kolkata -700107. 3. CIT(A)-NFAC, Delhi. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. 6. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata Printed from counselvise.com "