IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘A’ NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER Assessment Year: 2017-18 DCIT, Vs. Azad Coach Pvt. Ltd., Delhi 2 Hill Lane, Civil Lines, Delhi PAN: AAECA3035A (Appellant) (Respondent)

Assessee by Sh. Salil Kapoor, Adv.

Ms. Ananya Kapoor, Adv.

Sh. Anjul Dalela, Adv.

Department by Sh. Ajay Kumar Arora, Sr. DR Date of hearing 11.11.2025 Date of pronouncement 11.11.2025 ORDER PER SATBEER SINGH GODARA, JM This assessee’s appeal for assessment year 2017-18, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2024-25/1070000401(1), dated 28.10.2024 involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’).

Heard both the parties. Case file perused.

2. It transpires during the course of hearing that the Revenue herein is aggrieved against the CIT(A)/NFAC’s detailed discussing allowing the assessee’s lower appeal as against the Assessing Officer’s assessment dated 07.11.2019 inter alia rejecting it’s assessee’s books of account thereby estimating gross profits;

reading as under: -

“2. अपील का आधार/GROUNDS OF APPEAL:

Ground No. 1: That having regard to facts and circumstance of the case Ld. AO has erred in finalizing an ex parte order without giving opportunity of being heard.

Ground No. 2: The Ld AO has erred in asking for production of books of accounts whereas case was under online scrutiny Ground No. 3: Any other ground which may arise during the proceedings.

3. त(cid:538)ों का ि◌ववरण/Statement of Facts:

Assessee Company has filed return at NIL after adjusting the carried forward deprecation. Case was selected for scrutiny through CASS. Learned AO has Issued and ex-parte order without giving reasonable opportunity of being heard

4. In response to the notice u/s 250 of the I.T. Act 1961 sent by the NFAC on 22.03.2023, 20.12.2023,19.04.2024 and 21.09.2024 the appellant submitted its reply on 05.04.2023, 21.12.2023 and

27.04.2024 which is placed on record.

5. ि◌िलखत (cid:366)(cid:721)ुि◌त/Written Submission:

In response the appellant replied the following:

1.1 The A.O has assessed the income u/s 143(3) on the basis of estimated percentage of profit on turnover of the Company. The learned A.O asks for various information during assessment proceedings including ledger of accounts and details which were provided during the course of hearing.

1.2 It is not the case that the Company has not provided the details asked for during the assessment proceedings but the assessment was passed in hurry without providing adequate opportunity. We would also like to submit that the assessment order was passed on 7th November 2019 while the time barring of the assessment was on 31st December 2019. There was no reason with him to draft an opinion on guess work in haste and complete the assessment.

1.3 As per the Assessment order u/s 143(3) dt. 07.11.2019 the Ld. AO has mentioned that due to non-production of complete books of accounts along with all the supporting documents by the assessee the Ld. AO hereby rejected the books of accounts of the assessee as per the provisions of Section 145(3) of the Income Tax Act, 1961 and addition is made on pure guess work which is completely unjustifiable. We herewith like to produce the extract of Section 145 of the Income tax act, 1961 along with some case laws to justify our contentions.

According to Section 145 of the Income Tax Act, 1961.

1. “…………………………………………… ” 2. “…………………………………………… ”

Where the assessing officer is not satisfied about the correctness or completeness of the accounts of the assessee, or where the method of accounting provided in sub section (1) [has not been regularly followed by the assessee, or income has not been computed in accordance with the standards notified under sub-section (2)], the AO may make an assessment in the manner provided in Sectio