Ex-Parte Reassessment Order Passed Without Adjudication on Merits Remanded to Assessing Officer for Fresh Decision

ORDER

Paresh M Joshi, Judicial Member – ITA NO:- 807/Ind/2025 (AY:2014-15)

1. This is an appeal filed by the Assessee under section 253 of the income tax Act 1961,[ hereinafter referred to as the Act for the sake of brevity] before this tribunal, as & by way of a second appeal .The Assessee is aggrieved by the order bearing No:-ITBA/NFAC/S/250/2024-25/1074994454(1) dated 25.03.2025 passed by the Ld. CIT(A) u/s 250 of the Act, which is hereinafter referred to as the “Impugned order”. The Relevant Assessment year is 2014-15 and the corresponding previous year period is from 01.04.2013 to 31.03.2014.

2. Factual Matrix

2.1 That as and by way of an Assessment order made u/s 147 rws 144/144B of the Act, the total income of the assessee was computed and assessed at Rs. 55,23,920/-. The total income as per original return of Income was at Rs. 2,19,920/-. The addition of Rs. 53,04,000/- was made u/s 69 of the Act . The assessee was non-compliant in section 142(1) and so also in section 144 of the Act. Even in the show cause notice dated 06.04.2023 the assessee was non-compliant. It is a case of unexplained investment which was a house. That the aforesaid assessment order bears number: – ITBA/AST/S/147/2023- 24/1052606862(1) and that the same is dated 04.05.2023, which is hereinafter referred to as the “Impugned Assessment Order” for the sake of brevity.

2.2 That the assessee being aggrieved by the aforesaid “Impugned Assessment Order” prefers the first appeal u/s 246A of the act before the Ld. CIT (A) who by the “Impugned Order” has dismissed the first appeal of the assessee on the grounds and the reasons stated therein. The core grounds and the reasons for the dismissal of the first appeal were as under:-

“6. I have carefully considered the assessment order, the grounds of appeal, statement of facts and the relevant provisions of law. In response to the notices issued under Section 250 of the Act, no written submissions and documents in support of the grounds of appeal have been filed till date.

6.1 The present appeal pertains to the assessment proceedings initiated under Section 147 read with Section 144 of the Income Tax Act for the assessment year 2014-15. The case revolves around unexplained investment. The Assessing Officer issued multiple statutory notices under Sections 148, 142(1) and 144 of the Act, to which the appellant failed to respond.

6.2 The Appellant has not furnished any explanation with respect to source of investments.

6.3 At the appellate stage, the appellant has not furnished any written submission in support of his claim. No arguments have been advanced by him in his statement of facts and grounds of appeal to rebut the income determined by the AO. The appellant has chosen not to furnish a cogent explanation of the source of investment along with reliable evidence in support of his contentions and grounds of appeal despite ample opportunity and time allowed during the appellate proceedings. In such circumstances, the undersigned is left with no alternative but to presume that the appellant has no further submissions in support of his averments made in the grounds of appeal. Accordingly, the appeal is being decided keeping in view the facts brought on record by the AO in the assessment order and by the appellant in the grounds of appeal and statement of facts.

6.4 Based on the material available on record, the appellant’s contentions are not acceptable because of specific findings in the assessment order about no evidence being adduced by the appellant to corroborate the claim made. In the absence of any cogent material to explain the nature and source of the investment, the stand of the AO cannot be faulted. The appellant failed to explain the nature and source of the cash deposits during the assessment proceedings and even in the appellate proceedings. It is a trite law that once the appellant fails to discharge the onus cast on him to explain the nature and source of any sum of investment. The genuineness of transactions could not be proved to the satisfaction of the AO during the assessment proceedings.

6.5 Based on the facts mentioned above, detailed discussion in the assessment order by the AO and in the absence of any written submission by the appellant, / am not inclined to interfere with the decision of the AO.

6.6 Because of the facts mentioned above, / do not find any infirmity in the decision of the AO and / am not inclined to interfere with the decision of the AO.

Hence, Grounds of appeal No. 1 to 5 are found to be not maintainable. Accordingly, the same are hereby dismissed.

Ground No. 6 to 8 relate to initiation of penalty proceedings. The grounds are premature in nature and hence dismissed. Ground No. 9 is consequential in nature.

7. The appellant also craves leave to add, alter or amend before or during the hearing, with prior approval. This ground of appeal is academic in nature and is considered to be a dismissed ground for statistical purposes.

8. In the result, the appeal is Dismissed. Order passed under sec 250 read with sec. 251 of the Act.”

2.3 That the assessee being aggrieved by the “Impugned Order” has preferred the instant second appeal before this tribunal and has raised the following grounds of appeal in the form no. 36 against the “Impugned Order” which are as under:-

“1. On the facts and circumstances of the case and in law, the reassessment order dated 04.05.2023 is bad in law, without jurisdiction, and liable to be quashed.

2. On the facts and circumstances of the case and in law, the additions were made on mere conjectures, surmises and suspicions.

3. On the facts and circumstances of the case and in law, the reassessment was completed without complying with the statutory requirements of law.

4. On the facts and circumstances 2 of the case and in law, the reassessment order dated 04.05.2023 Rs. 0 is contrary to law, facts and circumstances of the case and in any case is opposed to the principles of equity, natural justice and fair play.

5. On the facts and circumstances of the case and in law, the notice under section 148 dated 16.07.2022 is void and illegal hence liable to quashed.

6. On the facts and circumstances of the case and in law, the Ld. AO could not have information suggesting the income had escaped assessment in the hands of the appellant.

7. On the facts and circumstances of the case and in law, the Assessment order dated 04.05.2023 is time barred and liable to be quashed.

8. On the facts and circumstances of the case and in law, The Ld. NFAC erred in upholding the addition of Rs. 53,04,000/– made to the income of appellant under section 69 of The Act

9. On the facts and circumstances of the case and in law, the provisions of Section 69 cannot be invoked.

10. On the facts and circumstances of the case and in law, the Ld. NFAC erred in applying the provisions of section 115BBE.

11. On the facts and circumstances of the case and in law, the initiation of penalty proceedings under Sections 271(1)(b) and 271(1)(c) is bad in law.

12. For that the appellant craves leave to add, amend, alter vary and OR withdraw any OR all the above grounds of appeal. All the aforesaid grounds are without prejudice to each other.”

3. Record of Hearing

3.1 The hearing in the matter took place before this Tribunal on 31.08.2026 when the Ld. AR for & on behalf of the Assessee appeared before us and interalia contended that the “Impugned Order” is bad in law, illegal and not proper. It is in the violation of the principle of natural justice. It therefore deserves to be set aside.

3.2 The Ld. AR has placed on record the appeal memo pages 1 to 41 and in continuation thereof pages 42 to 72. An affidavit dated 28.08.2026 is too placed on record. The Ld. AR has pointed out to us that there is a delay of 113 days in filing the present appeal and in this regard he prays for the condonation of delay and the reliance was placed on an affidavit dated 28.08.2026. It was submitted that date of Impugned Order is dated 25.03.2025 and the date of service of the “Impugned Order” is on 25.03.2025. The date of filing of the instant second appeal is dated 22.09.2025. The Ld. AR then invited our attention to appeal memo page 11 which was form no:-35 wherein the email address was paraswaniankit7@gmail.com It is stated in Para 5 of the affidavit dated 28.08.2026 that on email as provided in the form no. 35 all notices and communication were solicited. However the required notice(s) about five in number as per Para 6 never ever came to the email address as per the form no. 35 and instead the notice(s) dated 24.10.2024, 16.01.2025, 20.02.2025 & 04.03.2025 went to email address jiyaparaswani34@gmail.com and one notice dated 21.03.2024 went to email address CAGOVINDRAMANI@Yhoo.com. It was submitted that even the “Impugned Order” came at above email address instead of email address given in the form no. 35. It was additionally submitted that the assessee has no connection with email address jiyaparaswani34@gmail.com and in so far as email id address of CAGOVINDRAMANI@Yahoo.com is concerned it was of the former tax advisor and that he gave no information about any notice(s) to him. It was also submitted that the correct email address of his daughter is jiyaparwani34@gmail.com which could not be picked up either by mistake or due to other reason. It was finally submitted that “Impugned Order” was not served on email as per form no. 35 on correct email address That in Sep. 2025 when he approached his current tax advisor for the purpose of filing his ITR and upon login it was noticed that the “Impugned Order” is already passed against him. That thereafter on 22.09.2025 the instant appeal was filed abeit with the delay of 113 days. Hence delay of 113 days be condoned as “Sufficient cause” is shown. Per contra the Ld. DR appearing for the revenue has left the issue of condonation of delay to the wisdom of this tribunal to take appropriate call basis law. After hearing both the parties we are of the considered opinion that there is no abnormal delay and/or unexplainable delay. Cause shown is bonafide and genuine. The Ld. DR has not contradicted the contents of the affidavit in any manner whatsoever during the hearing – Hence the delay is condoned and the appeal is admitted.

3.3 The Ld. AR then contended that the “Impugned Assessment Order” is an ex-parte one. Notice dated 11.01.2023 u/s 142(1) basis appeal memo page 42 came to the former tax advisor and so also notice dated 20.01.2023 page 43. Notice u/s 144 too came to former tax advisor appeal memo page 44, dated 08.02.2023. Our attention was also invited to appeal memo pages 45 & 46 bearing email of ex tax advisor (a show cause notice and a hearing notice). Further our attention was invited to appeal memo pages 47 to 50 wherein all notices u/s 250 went to email id address at jiyaparaswani34@gmail.com which too was an incorrect one as correct one was jiyaparwani34@gmail.com. It was therefore finally submitted that order of the lower authorities are ex-parte and same should be set aside. Per contra the Ld. DR left the issue to the wisdom of this tribunal to take appropriate call basis law. The Ld. AR additionally submitted that in ITA No:- 810/Ind/2025 facts which are narrated herein above are more or less pari material and same should be disposed off accordingly. Emphasis was laid on Para 9, 10 & 11 of the affidavit dated 28.08.2026. Hearing was over and closed. Both the appeals were heard together with the consent of both the parties.

4. Observations Findings & conclusions

4.1 We have to decide the legality, validity and proprietary of the “impugned order” basis records of the case & the rival submission canvassed before us.

4.2 We have carefully perused the records of the case and have heard the submissions.

4.3 We basis records of the case & after hearing & further upon examining the rival contentions of the Ld. AR & the Ld. DR canvassed before us are of the considered opinion that the “Impugned Assessment Order” is under section 144/144B of the Act and the matter has not been adjudicated and adjudged basis merits. Even the “Impugned Order” is not on mertis. This tribunal desires that the total income of the assessee should be computed and assessed on the real time basis exigible to tax in accordance with law by following due process of law under the Act. This tribunal also expects the assessee to be compliant and should cooperate with the department as and when notices etc. are issued. In brief this tribunal desires the meritorious disposal of both the “Impugned Assessment Order” as well as the “Impugned Order”. The assessee cooperation in this regard assumes importance. The assessee cannot go in slumber mode. In the result we are of the considered opinion that the “Impugned Order” should be set aside and the matter should be remanded back to the file of the Ld. Assessing Officer for passing a fresh order on merits of the case. It is the expectation of this tribunal that the assessee would give his full and complete details including latest e-mail of his and his counsel where the notices could be served effectively by the department. The assessee is directed to attend hearing as and when fixed to explain the case & file reply and details as sought by the Ld. AO.

4.4 In view of the above, we set aside the “Impugned Order” and remand the case back to the file of the Ld. AO on de novo basis, who shall now pass a speaking and well- reasoned order on merits.

5. Order

5.1 In result, the Impugned Order is set aside as and by way of remand back to the file of the Ld. AO on de novo basis with above directions.

5.2 The appeal of the Assessee is allowed for statistical purpose.

5.3 ITA No:- 810/Ind/2025 (AY : 2018-19)

In this appeal the facts and circumstances are more of less identical and similar. Accordingly “Impugned Order” in the said appeal is set aside and that we remand the case back to the file of the Ld. AO on de novo basis on similar line i.e. ITA No:- 807/Ind/2025.

5.4 In result, both the appeal of the assessee are allowed for statistical purpose.