SRI VINAYAKA PROJECTS ,BANGALORE V. INCOME TAX OFFICER, WARD-5(2)(1), BANGALORE

ITA 1598/BANG/2025

AI Insights

The case involves Sri Vinayaka Projects appealing against an order from the National Faceless Appeal Centre (NFAC), which had dismissed their appeal ex-parte concerning an assessment order for the year 2016-2017. The primary contention was the failure of the CIT(A) to serve notices by post as specifically requested by the Assessee, leading to an unattended hearing and subsequent dismissal of the appeal. The Assessee argued that the partner's frequent movement and lack of access to the e-filing portal justified the request for postal communication. The Tribunal found merit in the Assessee's argument regarding the procedural oversight and remanded the case for a fresh hearing, emphasizing the need for adherence to principles of natural justice.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 790324 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 17-07-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUBRAMANIAN
• Assessee Lawyers: R. CHANDRASEKHAR
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice; Source of fund; Assessment record; FORM 26AS
• Section: 147; 234B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “B’’BENCH: BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No.1598/Bang/2025 (Assessment year 2016-17) Sri Vinayaka Projects C/o Chandrodaya Theatre Vidyapeeta Circle, Kathriguppa Main Road Bangalore 560 050 ………. Appellant [PAN: ACHFS9700J] The Income Tax Officer, Ward 5(2)(1) BMTC Building, 80 Ft. Road 6th Block, Koramangala Bangalore 560 095 ……….. Respondent Appearance For the Appellant/Assessee : Sri R. Chandrasekhar For the Respondent/Department : Sri Subramanian Date Conclusion of hearing : 27.11.2025 Pronouncement of order : 28.11.2025 O R D E R Per Rahul Chaudhary, Judicial Member: 1. The present appeal preferred by the Assessee is directed against the Order, dated 20/05/2025, passed by the National Faceless Appeal Centre (NFAC), New Delhi [hereinafter referred to as ‘the CIT(A)’] under Section 250 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] whereby the Ld. CIT(A) had dismissed the appeal against the Assessment Order, dated 26/03/2022, passed under Section 147 read with 144/144B of the Act for the Assessment Year 2016-2017. 2. The Assessee has raised the following grounds of appeal: 1. The ld. CIT(A)/NFAC ought not to have rejected the appeal by an ex- party order on the basis of notices uploaded in e-filing portal, when Printed from counselvise.com ITA No.1598/Bang/2025 Assessment Year 2016-2017 Page 2 of 4 the appellant specifically had sought notices to be served by the POST in the column provided in appeal memorandum in Form 35 and no postal notice is served. 2. The appellant submits the request made was on account that the partner will be moving very frequently from the place of business for project works and the facility to operate the e-filing portal will not be available at all places. 3. The learned CIT(A)/NFAC, having passed an order ex-party, ought to have decided the appeal on materials furnished along with the appeal memorandum and which are explained in the statement of facts. 4. The order of the learned CIT(A)/NFAC not in accordance with the law and is opposed to principles of natural justice. 5. The learned CIT(A) erred in confirming the levy of interest u/s 234A of the Act. 6. The learned CIT(A) erred in confirming the levy of interest u/s 234B of the Act. 7. The learned CIT ought to have directed the Assessing Authority to consider the self assessment tax of Rs.5,79,200/- paid. 3. The Learned Authorised Representative for the Assessee appearing before us submitted that the appeal preferred by the Assessee was dismissed by Learned CIT(A) since the Assessee had failed to make any representation. It was submitted that the default was on account of the fact that the notice of hearing were sent over email. The Assessee had specifically opted out of communication of notice over email in memorandum of appeal in Form No. 35 filed before the Learned CIT(A). Since no notices were received by the Assessee, the hearings before the Learned CIT(A) went unattended and the appeal was dismissed. The Learned Authorised Representative requested for another opportunity to make out a case on merits before the learned CIT(A). 4. Per contra, the Learned Departmental Representative submitted that the Assessee had been non-compliant in the assessment as well as the appellate proceedings before the CIT(A) and thus, the Assessee had failed to make use of the opportunities granted to Printed from counselvise.com ITA No.1598/Bang/2025 Assessment Year 2016-2017 Page 3 of 4 make proper representation. Therefore, order passed by the Learned CIT(A) be sustained. 5. In rejoinder the Learned Authorised Representative for the Assessee submitted that the relevant documents/details have already been filed before this Tribunal and the same are placed at pages 27 to 53 of the appeal set. It was submitted that the non- compliance by the Assessee before the authorities below was not deliberate and therefore, one more opportunity be granted to the Assessee. 6. We have considered the rival submissions and perused the material on record. We find that Assessing Officer had made addition of INR.2,75,00,000/- in the hands of the Assessee observing that the Assessee had failed to provide/prove the source of the aforesaid payment made for purchase of immovable property. We note that during the assessment proceedings the Assessee had filed e- response (vide Acknowledgement No.419764521 240322) placing on the assessment record the Form 26AS, Bank Statement and some documents related to investment made in properties. It was explained that the source of funds utilized for the purchase of the immovable property were sale consideration received by the Assessee from sale of site after development. Further, we note that while instituting appeal before the Learned CIT(A) on 03/05/2022, the Assessee had again filed relevant documents and details vide Acknowledgement Number : 349219921 140322. On perusal of Form 35 we find that the Assessee had opted out of service of notice/communication over email. After considering the overall facts and circumstances of the case, we deem it appropriate and in the interest of justice to grant another opportunity to the Assessee to make out a case before the Learned CIT(A). Accordingly, we set aside the Order, dated 20/05/2025, passed by the Learned CIT(A) with the directions to adjudicate the ground raised by the Assessee Printed from counselvise.com ITA No.1598/Bang/2025 Assessment Year 2016-2017 Page 4 of 4 in the appeal before the Leaned CIT(A) afresh after granting the Assessee a reasonable opportunity of being heard. The Learned CIT(A) shall take into consideration the material already forming part of the assessment record and the record of the Learned CIT(A). The Assessee would be at liberty to raise all the rights and contentions of the Assessee as the same are left open. 7. The Assessee is directed for update the correct email address on the ITBA portal and on the records of the Learned CIT(A). The Assessee is also directed to be vigilant and track the appellate proceedings through Income Tax Business Application Portal. 8. In terms of the above, Ground No. 1 raised by the Assessee is treated as allowed while all other ground raised by the Assessee are dismissed as having been rendered infructuous at this stage since we have remanded the issue back to the file of the CIT(A) and therefore, dismissed. 9. In result, the present appeal preferred by the Assessee is partly allowed. Order pronounced on 28.11.2025. Sd/- Sd/- (Waseem Ahmed) Accountant Member (Rahul Chaudhary) Judicial Member Bangalore, Dated 28th Nov,2025. VG/SPS Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The DR, ITAT, Bangalore. 5 Guard file By order Asst. Registrar, ITAT, Bangalore. Printed from counselvise.com "