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2026 Supreme(Online)(ITAT) 7873
INCOME TAX APPELLATE TRIBUNAL (MUMBAI BENCH)
Pawan Singh, Judicial Member, Makarand Vasant Mahadeokar, Accountant Member
ACIT Circle-1, Thane – Appellant
Versus
Ameet Ashok Rajput – Respondent
ITA No. 8161/Mum/2025|C.O. No. 39/Mum/2026
For the Appellants/Petitioners: Bhagirath Ramawat
For the Respondents: R. D. Khona, Dinesh R. Shah
An appellate authority must ensure procedural compliance under Rule 46A of the I.T. Rules, 1962, when admitting additional evidence, and must provide a speaking, reasoned order after granting the Assessing Officer an opportunity to verify such evidence, especially in cases arising from ex parte assessments.
Headnote:(A) Income Tax Act, 1961 - Section 68, 144, 147, 250 - Income Tax Rules, 1962 - Rule 46A(1) and 46A(3) - Ex parte assessment - Admission of additional evidence at the appellate stage - Procedural requirement - The appellate authority failed to record satisfaction regarding the admission of additional evidence or prove compliance with the requirement of providing an opportunity to the Assessing Officer to rebut such evidence. (Paras 13, 17, 18)
(B) Appellate Procedure - Remand report - Necessity of speaking order - An appellate order must be a speaking and reasoned order reflecting independent inquiry and consideration of evidence, especially when setting aside an ex parte assessment. (Paras 18, 19)
Facts of the case:
The Revenue appealed against an order of the Commissioner of Income Tax (Appeals) which deleted an addition of Rs. 8,57,224/- made under Section 68 of the Act, despite the assessment being framed ex parte. The assessee filed a cross-objection seeking to uphold the deletion and raising various legal issues including lack of jurisdiction and monetary limits.
Findings of Court:
The Tribunal observed that the impugned order of the CIT(A) was cryptic, lacked necessary procedural compliance under Rule 46A of the Income Tax Rules, and failed to address whether the Assessing Officer was given an opportunity to respond to the additional evidence.
Issues: Whether the CIT(A) erred in deleting the addition without complying with the procedural requirements of Rule 46A and whether the appellate order was adequately reasoned.
Ratio Decidendi: The appellate authority is duty-bound to record findings on the admissibility of additional evidence under Rule 46A and must ensure that the Assessing Officer is afforded an opportunity to verify the evidence; a failure to do so renders the order unsustainable in law.
Result: Revenue appeal allowed for statistical purposes; Cross objection dismissed as infructuous with liberty to raise legal grounds in fresh proceedings.
| Table of Content |
|---|
| 1. summary of procedural history and grounds raised by revenue and assessee. (Para 1 , 2 , 3 , 4 , 5) |
| 2. revenue's contention regarding violation of rule 46a and lack of reasoned order. (Para 6 , 7 , 8 , 9) |
| 3. assessee's defense of rule 46a compliance and submission of additional evidence. (Para 10 , 11 , 12) |
| 4. court's analysis on failure to comply with rule 46a and the requirement for a speaking order. (Para 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21) |
| 5. final outcome: set aside and remand for fresh adjudication. (Para 22 , 23) |
| Revenue by | Shri Bhagirath Ramawat, Ld. DR |
| Assessee by | Shri R. D. Khona & Shri Dinesh R. Shah, Ld. ARs |
| Date of Hearing | 25.03.2026 |
| Date of Pronouncement | 27.03.2026 |
आदेश / ORDER
PER MAKARAND VASANT MAHADEOKAR, AM:
These captioned matters comprise the appeal filed by the Revenue and the cross objection filed by the assessee, both directed against the order dated 29.08.2025 passed by the learned Commissioner of Income Tax (Appeals), Addl./JCIT (A), Bhopal [hereinafter referred to as "CIT(A)"]under section 250 of the Income Tax Act, 1961 [hereinafter referred to as "the Act"] for the Assessment Year 2007-08, arising out of the assessment order dated 20.03.2015 passed by the Assessing Officer, Ward 1(1), Thane [hereinafter referred to as "Assessing Officer"]under section 144 r.w.s. 147 of the Act. Since both the appeal of the Revenue and the cross objection of the assessee emanate from the same appellate order and involve common facts and interconnected issues, they were heard together and are being disposed of by way of this consolidated order for the sake of convenience and brevity.
2. The appeal before the learned CIT(A) was instituted against the ex parte assessment framed by the Assessing Officer. The Assessing Officer had completed the assessment under section 144 r.w.s. 147 determining the total income at Rs. 8,57,224/-, making addition under section 68 on account of alleged accommodation entries based on information received from investigation wing pertaining to M/s Mahasagar Securities and Shri Mukesh Choksi group.
3. The learned CIT(A), after considering the submissions of the assessee and material placed on record, deleted the addition holding that the Assessing Officer had failed to carry out independent enquiry and had not brought any cogent material on record to sustain the addition.
4. Aggrieved by the relief granted by the learned CIT(A), the Revenue is in appeal before us raising following grounds of appeal:
1. On the facts & in the circumstances of the case, the ld. CIT(A) erred in failing to ignore that the impugned assessment order was passed ex parte under Section 144 as the assessee did not comply during the assessment proceedings and went on accepting the argument of assessee and additional evidence furnished by him in violation to Rule 46A(3) of the I.T. Rules, 1962 without providing opportunity of hearing to the Assessing Officer.
2. The appellant craves leave to add, amend, alter or delete any ground of appeal.
5. The assessee, on the other hand, has filed cross objection raising following grounds:
1. Order of CIT(A) NFAC to Be Upheld
1.1 The learned CIT(A), NFAC, namely Mr. Sujoy Kumar Samanta, Addl./JCIT (A), Bhopal, has passed a well-reasoned order in favour of the assessee.
1.2 The learned CIT(A) has considered all facts, issues, and legal aspects, and has not decided the appeal on a single point alone.
1.3 The order of the CIT(A) deserves to be upheld in to.
2. Lack of Jurisdiction to File Appeal
2.1 The learned ACIT, Circle–1, Thane had no jurisdiction to file the present appeal, as the assessed income is Rs. 8,57,224/-, and the disputed tax involved is Rs. 2,11,309/-, which is below the monetary limit prescribed under CBDT Circulars applicable at the relevant time.
2.2 The assessment was completed u/s 144 r.w.s. 147 determining income at Rs. 8,57,224/-, which itself is below the threshold for filing departmental appeal. Hence, the appeal is not main
