AI Structured Summary
Not yet generated for this judgment
Judgment
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
In these two cases, the case bearing ITA No.1158 is the quantum order and ITA No.1157 is a penalty on that quantum u/s 271(1)(c) of the Income Tax Act, 1961 (hereafter as “the Act”). It is seen that ITA 1158 emanates from order dated 09.12.2025, passed by NFAC; and ITA 1157 emanates from order dated 09.12.2025, passed by NFAC.
On the last date of hearing, none attended on behalf of the assessee but it was decided to proceed ahead with the adjudication with the help of Ld. DR. It is seen that in the quantum matter (ITA 1158) the Ld. AO passed an ex parte order after adding an amount of Rs.17,66,266/- as undisclosed income. This assessment order was passed in an ex parte manner, since the assessee did not appear before the AO or filed any details thereon. It is seen that even before the Ld. CIT(A) the assessee made a very brief submission, as extracted in para 4 at page 2 of the impugned order, and stated that the Ld. AO should have assessed income on the basis of return of income only. It is seen that the Ld. CIT(A) has doubted the genuineness of the returned income and upheld the action of the Ld. AO. Admittedly, the assessee has not filed any document or evidence in response to the allegation of undisclosed receipts which could be determined from Form 26AS.
The aggrieved assessee has approached the ITAT by challenging the reopening of the quantum case and also regarding the denial of opportunity. It is seen that in the penalty matter (ITA 1157) the AO’s order is passed in an ex parte manner and even the Ld. CIT(A) has passed a very cryptic order. The assessee is also seen to have made a submission before the Ld. CIT(A) (as recorded in para 4 at page 2 of the impugned order) that the assessee was not conversant with tax procedures and therefore there should be some relief on that account. Needless to say, the Ld. CIT(A) upheld the order of Ld. AO.
Thus, it is seen that in both the appeals the orders of authorities below are non-speaking and more or less passed in an ex parte manner.
The assessee has challenged the action of authorities below on the grounds of assumption of jurisdiction as also on merit.
The Ld. DR assisted the Bench in going through the documents filed by the assessee. It was pointed out that in the absence of any document or even a valid Income tax return it was not possible for either of the authorities below to appreciate the facts of the case.
We have considered the submissions of Ld. DR and have also gone through the records before us. It is felt that the assessee is being penalized for non-compliance before the Ld.AO and in sufficient presentation of facts before either of the authorities below. Accordingly, in the interests of substantive justice, we deem it fit to set aside the impugned quantum order [ITA 1158] and remand this matter back to the file of Ld. AO for fresh assessment. The assessee would do well to make a presentation of facts before the Ld. AO and the Ld. AO would consider the same after affording an opportunity of being heard.
Regarding the penalty matter, since the quantum has been remanded back to the file of Ld. AO, hence, the penalty stands deleted. However, the Ld. AO would be at liberty to reinitiate the penalty proceedings in case it is legally necessary to do so.
Accordingly, ITA 1158 is allowed for statistical purposes, having been remanded back. ITA 1157 is allowed with the deletion of the penalty.