YUVIKA ALLOYS,JABALPUR vs. INCOME TAX OFFICER WARD 1(1), JABALPUR

ITA No. 4/Jab/2022(AY 2016-17) Yuvika Alloys v. ITO IN THE INCOME TAX APPELLATE TRIBUNAL, JABALPUR BENCH, JABALPUR (through Virtual Hearing) BEFORE SH. SANJAY ARORA, HON'BLE ACCOUNTANT MEMBER & SH. MANOMOHAN DAS, HON‟BLE JUDICIAL MEMBER ITA No. 4/JAB/2022 Assessment Year: 2016-17 Yuvika Alloys, Income Tax Officer, vs. Ward -1(1), Jabalpur Jabalpur [PAN : AABFY 1482H] (Appellant) (Respondent) Appellant by Shri Rajeev Nema, Advocate Respondent by Sh. S.K. Halder, Sr. DR Date of hearing 23/02/2022 Date of pronouncement 08/03/2022

ORDER Per Manomohan Das, JM This is an Appeal by the Assessee agitating the dismissal of its‟ appeal contesting its‟ assessment under section 143(3) of the Income Tax Act, 1961 („the Act‟ hereinafter) dated 10/12/2018 for Assessment Year (AY) 2016-17, since upheld by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi („CIT(A)‟ for short) vide Order dated 18/11/2021. 2. The brief facts of the case, as stated in the memo of appeal, are that the assessee, a partnership firm engaged in the business of purchase and sale of scrap, filed its‟ return of income for the year at a total income of Rs.3,59,940. The same was selected for being subject to complete scrutiny by the Assessing Officer (AO). The AO completed the assessment by making disallowances in respect of cash purchases (at Rs.1,56,901) and liquidated damages (Rs.

ITA No. 4/Jab/2022(AY 2016-17) Yuvika Alloys v. ITO 1,32,137), i.e., aggregating to Rs. 2,89,038, to the returned income, assessing the income at Rs.6,48,980. 3. Being aggrieved, the assessee filed an appeal before the ld. CIT(A). However, due to the sickness of the partner of the assessee-firm who was looking after its‟ income-tax matters, as stated in the appeal memo, there was a delay of seven days in filing the appeal. The ld. CIT(A), per an ex parte order, treated the appeal as infructuous on the ground of delay in filing the appeal being unexplained, and also dismissed the appeal on merits. 4. Before us, the grievance of the assessee-appellant was the non-receipt of the alert (on his mobile number), which is to necessarily follow the receipt of the notice of hearing per email, i.e., as per the „Faceless Appeals Scheme, 2020‟ notified on 25/9/2020, so that the same was applicable during the period of hearing before the first appellate authority. This contention by the assessee is per a sworn affidavit dated 22/2/2022 by Sh. Deepak Gupta, partner, who is also the signatory of the appeal memo before the ld. CIT(A) as well as the Tribunal. 5. We have heard the parties, and given our careful consideration to the matter. 5.1 The first issue arising in the instant appeal is non-condonation of the delay of 7 (seven) days by the ld. CIT(A) in filing the appeal before him. The reason for the said delay is stated as “sickness” (para 4 of the impugned order). It is, thus, not understood as to how does the ld. CIT(A), vide para 5 of its order, states of no reason for the delay having been specified by the assessee, constraining him not to condone the delay. The ld. CIT(A), in case he entertained any doubt as to the stated reason, ought to have, in order to satisfy himself in the matter, required the assessee to substantiate the stated reason for the delay, but could not have dismissed it outright, which is what it in effect does.

ITA No. 4/Jab/2022(AY 2016-17) Yuvika Alloys v. ITO 5.2 The ld. CIT(A), next, proceeds to adjudicate the appeal on merits which, perhaps, is indicative of his inclination to condone the delay. However, a perusal of his order (paras 6 to 8) reveals no adjudication on merits, as stated, so that it is only apparently or ostensibly so. The impugned order, in our view, does not therefore satisfy the clear mandate of section 250(6) of the Act.

5.3 The Hon‟ble Supreme Court of India has in Swadeshi Cotton Mills Co. Ltd. v. Union of India [1981] 51 Comp Cases 210 (SC)(226, 227) held that the maxim of audi alterm partem has many facets. Two of them are: (i) notice of the case to be met; and (ii) an opportunity to explain. Further, the Apex Court in CST vs. R.P. Dixit Saghidar [2002] 127 STC 337(SC) held that where the principle of natural justice is stated to have been violated, it is open to the appellant authority to in appropriate cases set aside the order and require the assessing authority to decide the case de novo. 6. We, in view of the foregoing, consider it fit and proper under the circumstances to, setting aside the impugned order, restore the matter back to the file of the ld. CIT(A) for an adjudication afresh, i.e. de novo. The assessee shall be provided a reasonable opportunity of hearing before him on each of the grounds assumed or which it may wish to take, before the first appellate authority, who shall consider the same on merits as per law. Non-cooperation on the part of the assessee, if so, would entitle the ld. CIT(A) to draw an adverse inference as admissible in law. We decide accordingly.

ITA No. 4/Jab/2022(AY 2016-17) Yuvika Alloys v. ITO Copy of the Order forwarded to: 1. The Appellant: Yuvika Alloys, 432 Parijat Building, Cherital, Jabalpur (M.P.) - 482002 2. The Respondent: Income Tax Officer, Ward 1(1), Jabalpur (M.P) 3. National Faceless Appeal Center (NFAC), Delhi 4. The Sr. DR, ITAT, Jabalpur (M.P.) 5. Guard File By order

Senior Private Secretary, ITAT, Jabalpur.