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Judgment
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
This is a batch of two appeals pertaining to the same assessee and since the issues are interconnected hence these two cases are being disposed of through a single order. It may be mentioned that ITA No.618/Del/2026 pertains to a quantum order, whereas ITA No.619/Del/2026 pertains to a penalty u/s 272A(1)(d) of the Income Tax Act, 1961 (hereafter as “the Act”). The quantum appeal arises from the order dated 28.11.2025, passed u/s 250 of the Act by Ld. CIT(A)-NFAC. Similarly, ITA No.619/Del/2026 arises from order dated 28.11.2025, passed u/s 250 of the Act by Ld. CIT(A)-NFAC, Delhi.
It is seen that in the quantum matter, the Ld. AO passed an ex parte order through which additions were made u/s 68 of the Act, u/s 69 of the Act, u/s 69A of the Act and also by disallowing 30% of total expenses claimed allegedly for want of documentary evidence. The total of such additions amounts to Rs.9,66,38,053. As mentioned earlier, this order was passed in an ex parte manner. It is seen that the aggrieved assessee approached the Ld. CIT(A) where he attempted to file additional evidences under Rule 46A through his letter dated 15.10.2024. Through this application under Rule 46A the assessee attempted to file new evidence including details of share premium receipts, bank details, etc. However, the Ld. CIT(A) has ostensibly disregarded this application and has adjudicated on the basis of facts on record. In fact the adjudication on penalty has virtually also been done through the quantum order.
Further aggrieved the assessee has approached the ITAT with grounds challenging the impugned actions.
Before us the Ld. AR argued with the help of a detailed paper book through which it was pointed out that while due to a communication gap between the assessee and his tax consultant compliance could not be made before the Ld. AO, but attempts to file the necessary documents before the Ld. CIT(A) was not allowed since the application under Rule 46A was not admitted. It was the submission that there was denial of opportunity and the assessee’s documents and arguments have neither been considered by the Ld. AO nor by the Ld. CIT(A). It was the submission that the assessee may be allowed another opportunity to present the facts so that his correct income could be determined, within the parameters of law. Regarding the penalty it was stated that due to the very same reason that the assessee could not present the facts before the Ld. AO, the penalty u/s 27A(1)(d) of the Act was levied on account of such non-compliance. It was the submission by the Ld. AR that there was no opportunity to present any explanation for non-compliance before the Ld. AO and thus, for this reason also the assessee deserves another chance to make a full presentation of facts before the Ld. AO.
The Ld. DR relied on then orders of the authorities below.
We have carefully considered the rival submissions and have gone through the impugned orders. It is seen that the assessee did try to file new evidence under Rule 46A but the same was denied for all intents and purposes since there is no mention of the same in the body of the impugned order. It is felt that in the interests of substantive justice, the assessee deserves another chance to make a presentation of facts before the Ld. AO so that the Ld. AO has an opportunity to appraise the evidence in possession of the assessee. For this purpose, we set aside the two impugned orders and remand the quantum and the penalty matter back to the file of Ld. AO for fresh adjudication, after providing ample opportunity of being heard.
In the result, the two appeals are partly allowed for statistical purposes.