Saurabh Rana vs DCIT, Circle 70(1)

PER MANISH AGARWAL, A.M.:

The present appeal is filed by assessee against the order dated 26.11.2025 passed by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld. CIT(A)”] in Appeal No. NFAC/2014-15/10112893 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of assessment order dated 26.03.2022 passed u/s 147 r.w.s. 144B of the Act pertaining to Assessment Year 2015-16.

Brief facts of the case are that the appellant deriving income from salary, declaring total income of INR 4,46,490/- on 24.08.2015. The AO has information that the assessee has acquired immovable property of INR 1.00 crores and the sale consideration is not commensurate with the income declared and therefore, with the prior approval of ld. PCIT, re-assessment proceedings were initiated by way of issue of notice u/s 148 on 31.03.2021. In response to notice u/s 148, no return of income was filed by the assessee nor any compliance was made to the statutory notices issued u/s 142(1) of the Act from time to time therefore the AO has passed the re-assessment order by making addition of INR 1.00 crore u/s 69 of the Act being the investment in acquisition of immovable property. Accordingly, total income of the assessee was assessed at INR 1,04,46,490/-.

Aggrieved by the said order, assessee is in appeal before ld. CIT(A) where the assessee has filed various documents as additional evidences Under Rule 46A of the Income Tax Rules, 1962 (the Rules). These documents were sent to the AO for Remand Report who in the Report observed that assessee was provided many opportunities during the remand proceedings to appear and substantiate the claim however, none of the opportunity was availed. In view of these facts, ld. CIT(A) had not admitted the additional evidences filed by the assessee and confirmed the addition made and dismissed the appeal of the assessee.

Aggrieved by the order of Ld. CIT(A), the assessee is in appeal before the Tribunal by taking various Grounds of appeal mentioned in the appeal memo.

Ground of appeal No.3 raised by the assessee challenging the order of ld. CIT(A) of not providing effective and sufficient opportunity of hearing to explain the case.

Before us, ld.AR for the assessee submits that assessee had field all the relevant details before ld. CIT(A) including the confirmations from the employer from whom the funds were received for making investments in the property. Ld.AR submits that though the assessee had not appeared before the AO during the remand proceedings however, the AO has not made an inquiry whatsoever from the employer though all the details were filed as additional evidences. He therefore, submits that if one more opportunity is provided, the assessee will appear and submits all the plausible explanation to the AO with respect to the source of investment in immovable property. He prayed accordingly.

On the other hand, ld. SR. DR vehemently supported the orders of the lower authorities and submits that assessee since beginning of the re-assessment proceedings has avoided the proceedings as neither any return of income was filed any notice u/s 148 nor any compliance was made to the statutory notices issued. Even in the Remand proceedings, assessee has not appeared before the AO. He therefore, prayed for the confirmation of the orders of the lower authorities.

Heard the contentions of both the parties and perused the material available on record. From the orders of the lower authorities, it is observed that assessee has continuously avoided the proceedings by not appearing nor making compliances to the statutory notice. However, the facts remained that details were filed by the assessee as additional evidence before Ld. CIT(A) including confirmations from the employer from whom funds were borrowed and the AO has made no effort for verification of the same from the employer. It is true that assessee has committed fault by not appearing/filing the requisite details however that alone cannot be the basis to shut the doors of justice. In view of these facts and further considering the facts that the assessee has already filed the relevant details, in the larger interest of justice, one more opportunity is provided to the assessee and we set aside the order of the lower authorities matter and remanded back to the file of AO with the direction to pass the re-assessment order denovo afresh after providing reasonable opportunity of hearing to the assessee. The assessee is also directed to appear and file the details as were filed before ld. CIT(A) to prove the source of investment. In case, the assessee still avoid the proceedings, the AO is at liberty to pass the order in accordance with law. With these directions, Ground of appeal No.3 raised by the assessee is allowed for statistical purposes.

Since we have allowed Ground of appeal No.3 for statistical purposes and direct the AO pass the order denovo, remaining Grounds of appeal are not adjudicated.

In the result, appeal filed by the assessee is allowed for statistical purposes.