ITAT Quashes Ex-Parte Order in Real Estate Cash Deposit Case, Directs Fresh Hearing
The Income Tax Appellate Tribunal (ITAT) in Ahmedabad has quashed an ex-parte order issued by the Commissioner of Income Tax (Appeals) and directed a fresh hearing in a case involving real estate businessman Ghanshyambhai Nanalal Charandas.
Real EstateIncome TaxExparte OrderItatNatural JusticeReal Estate NewsOct 04, 2025
The appellant, Ghanshyambhai Nanalal Charandas, an individual engaged in the business of real estate, house property, and other sources of income, filed his return for the Assessment Year 2015-16, declaring an income of ₹6,31,710 along with agricultural income of ₹28,00,000.
The case was selected for limited scrutiny. However, the Assessing Officer (AO) completed the assessment under Section 143(3) of the Income Tax Act, 1961, determining the income at ₹1,70,11,619 by making additions of ₹88,60,909 as unexplained cash deposits and ₹75,19,000 as unexplained investments in land.
Aggrieved by this, the assessee filed an appeal before the CIT(A). Despite being granted eight opportunities, the appeal was dismissed ex-parte on December 29, 2023, confirming the AO’s additions. This led to the appeal being brought before the ITAT.
Represented by Anil Kshatriya, the assessee argued that the assessment order was invalid as the AO had exceeded the scope of limited scrutiny without the necessary approval for conversion into complete scrutiny. It was submitted that detailed written submissions had been filed before the CIT(A), who had called for a remand report from the AO in 2019. The AO submitted the remand report in July 2020.
However, after the case was migrated to the CIT(A), these documents were not considered, and the appeal was dismissed ex-parte. It was contended that due to a change in tax consultant, the assessee was unaware of the NFAC hearing dates, leading to non-appearance.
Represented by Nitin Vishnu Kulkarni, the Revenue submitted that the remand report dated July 23, 2020, was indeed on record. It was argued that the matter should be restored to the CIT(A) for proper adjudication on merits, rather than allowing the assessee’s appeal outright.
The Bench, comprising Judicial Member T.R. Senthil Kumar and Accountant Member Narendra Prasad Sinha, observed that the CIT(A) had dismissed the appeal without considering either the assessee’s written submissions or the remand report filed by the AO. Thus, the Tribunal held that this amounted to a violation of the principle of natural justice.
Accordingly, the matter was remanded back to the CIT(A), with a direction to adjudicate the case afresh on merits after granting the assessee proper opportunity of hearing. The Tribunal also directed the assessee to fully cooperate and file all relevant documents, with liberty to raise additional grounds.
Thus, the appeal of the assessee was allowed for statistical purposes.
Frequently Asked Questions
What is an ex-parte order in the context of income tax?
An ex-parte order in the context of income tax is a decision made by a tax authority in the absence of one of the parties involved. This can happen if the party fails to appear or present their case, leading to a judgment being made without their input.
What is the principle of natural justice in tax cases?
The principle of natural justice in tax cases ensures that all parties are given a fair and impartial hearing. This includes the right to be heard, the right to know the case against them, and the right to present their case without bias.
What is the role of the Income Tax Appellate Tribunal (ITAT)?
The Income Tax Appellate Tribunal (ITAT) is a quasi-judicial body that hears appeals against orders passed by the Commissioner of Income Tax (Appeals). It provides a forum for taxpayers to challenge decisions and seek a fair and impartial review.
What is a remand report in tax proceedings?
A remand report in tax proceedings is a document prepared by the Assessing Officer (AO) in response to a direction from a higher authority, such as the Commissioner of Income Tax (Appeals), to reconsider certain aspects of the case. It provides additional information and clarifications.
Why was the ex-parte order quashed in this case?
The ex-parte order was quashed because the Commissioner of Income Tax (Appeals) dismissed the appeal without considering the assessee’s written submissions and the remand report from the Assessing Officer. This was deemed a violation of the principle of natural justice.
Related News Articles
RERA Cases Weekly Round-Up: Relief for Homebuyers Across India
From refund orders to structural defect rectification
Gurugram Leads Housing Price Surge, Mumbai Lagging Behind
In the last five years, the average price of new housing projects in India’s top 10 cities has surged by 88%, with Gurugram leading the pack at a 160% increase. Mumbai, on the other hand, has seen the lowest rise at 37%. This surge is attributed to massiv
Anant Raj Reports 75% Increase in Net Profit for Q2 FY25
Anant Raj has announced a significant 75% increase in its net profit for the second quarter of the fiscal year 2025. The company also reported a 53.67% rise in its net consolidated total income. This robust growth is a testament to the company's strategic
DLF JV Firm Sells IT Park in West Bengal's Largest Real Estate Deal for Rs 637 Cr
In a significant move, DLF, the country's largest real estate developer by market cap, has completed the sale of an IT park in West Bengal for Rs 637 crore. The deal, involving a joint venture firm, marks one of the largest real estate transactions in the
Eleganz Interiors Files DRHP with NSE Emerge
Eleganz Interiors plans to use Rs 25 crore from the IPO proceeds to repay a portion of its outstanding borrowings, as it files its DRHP with NSE Emerge.
Tata Steel Slapped with Rs 146 Mn Fine for Delay in Stamp Duty Payment
Tata Steel, one of India's leading steel producers, has been penalized with a fine of Rs 146 million by the Maharashtra government for failing to timely pay the stamp duty. The fine, as per the company's exchange filing, highlights the importance of adher