JAINSON HOLDING PVT. LTD.,DELHI vs. ITO, WARD 13(2), DELHI

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ITA 2004/DEL/2021Status: DisposedITAT Delhi21 March 2023AY 2015-163 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT found that the CIT(A) should have decided the appeal on merits after calling for records, rather than dismissing it ex-parte. Therefore, the ITAT set aside the order and remanded the matter back to the CIT(A).

What were the facts?

The assessee filed its return of income, which was selected for limited scrutiny. The Assessing Officer made additions for unverified investment in unlisted equities and unexplained share premium as the assessee did not respond to notices. The CIT(A) dismissed the appeal ex-parte without considering the merits.

What were the issues?

Whether the CIT(A) erred by dismissing the appeal ex-parte without adjudicating on the merits of the case, and whether the additions made by the AO were justified.

Which sections of the Income-tax Act were involved?

None explicitly mentioned in the operative part of the judgment, but the additions relate to unverified investments and share premium which would typically fall under sections like Section 68.

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Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: SH. N. K. BILLAIYA & SH. ANUBHAV SHARMA

Hearing: 21/03/2023Pronounced: 21/03/2023

PER N. K. BILLAIYA, AM:

1.

This appeal by the assessee is preferred against the order of the CIT(A)-5, New Delhi dated 27.09.2019 pertaining to A.Y.2015- 16.

2.

The grievance of the assessee read as under :- 1. Action of Commissioner of Income Tax (Appeals)-5 in confirming the addition of Rs.2,27,333/- on account of unverified investment into unlisted equities without considering the material available by the assessee company is unjust,

illegal arbitrary and against the facts and circumstances of the case. 2. Action of CIT(A)-5 in confirming addition of Rs.4,05,38,590/- being share premium without considering the material available on record is unjust, illegal arbitrary and against the facts and circumstances of the case. 3. The assessee craves leave to add, amend alter or delete the above grounds of appeal at the time of hearing Total tax effect (see note below) Rs.1,79,39,680/-

3.

None appeared on behalf of the assessee inspite of notices. Therefore, we decided to proceed exparte. The DR was heard at length. Case records carefully perused.

4.

Briefly stated the facts of the case are that the assessee electronically filed its return of income on 15.01.2016 declaring income of Rs.5,12,810/-. The return was selected for limited scrutiny under CASS and accordingly statutory notices were issued and served upon the assessee. The assessee was asked to furnish the details specified in the questionnaire which was issued on 19.07.2017. The querry raised by the AO were not responded by the assessee. The AO was left with no choice but to proceed with the case. The AO was of the opinion that the assessee has invested Rs.227,333/-in unlisted equities which remained un-verified and has received share premium of Rs.40538590/- which remained un-explained and accordingly completed the assessment proceedings by making addition of Rs.2,27,333/- and Rs.4,05,38,590/-

5.

Assessee carried the matter before the CIT(A) but inspite of repetitive notices did not attend the appellate proceedings and the CIT(A) was left with no choice but to dismiss the appeal exparte. However, while dismissing the appeal the CIT(A) has not considered the merits of the case and strongly relied upon the decision of the Hon’ble Supreme Court in the case of BN Bhattacharjee 118 ITR 461 and Madhya Pradesh High court of Estate Late Tukojirao Holkar 223 ITR 480.

6.

In the interest of justice and fair play we are of the considered opinion that the CIT(A) ought to have dismiss the appeal on merits of the case after calling for the assessment records and related documents. Therefore, considering the facts of the case in totality we set aside the issue to the files of the CIT(A). The CIT(A) is directed to decide the appeal afresh after affording a reasonable and adequate opportunity of being heard to the assessee and the assessee is directed to attend the appellate proceedings and submit his case. 7. In the result, the appeal of the assessee is allowed for statistical purpose. 8. Decision announced in the open court on 21.03.2023.

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