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Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI PAVAN KUMAR GADALE & SHRI GAGAN GOYAL
Appellant by : Shri.Pavan Ved. AR Respondent by : Shri.Rameshwar Meena. Sr.DR Date of Hearing 09.10.2023 Date of Pronouncement 11.10.2023 आदेश / O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of the National Faceless Appeal Centre (NFAC), Delhi /CIT (A) passed u/sec 143(3) and U/sec 250 of the Act. The assessee has raised the following grounds of appeal:
1. fresh ground Whole assessment is null and void ab initio as notice u/s 143(2) was issued by DCIT while the assessee falls in the Shams Tabrez Gulam Madni Ansari, Mumbai. - 2 -
monetary jurisdictional of ITO as returned income is below Rs.30,00,000/- 2. Fresh ground assessment order is also void for similar reason. 3. the ld. CIT(A) has erred in confirming addition of outstanding trade creditors of Rs.75,31,111/- u/s 41(1) 4. the ld. CIT(A) has erred in confirming addition of new credits of Rs.1,02,294/- u/s 68.
The brief facts of the case are that, the assessee is engaged in the business of manufacturing and export of ladies embroidery garments in the name and style of M/s. Glazy Wear. The assessee has filed the return of income for the A.Y 2016-17 on 13.12.2016 disclosing a total income of Rs. 22,14,090/-. Subsequently the case was selected for limited scrutiny and notice u/sec 143(2) and U/sec 142(1) of the Act are issued calling for the details through e- filing portal. In compliance notice, the assessee has filed the details and information through e filing portal. The Assessing Officer (AO) on perusal of the financial statements found that(i) the assessee has disclosed the sundry creditors and since genuineness of creditors is not established, further the PAN and address of the creditors are not provided and no explanations were filed , the A.O invoked the Shams Tabrez Gulam Madni Ansari, Mumbai. - 3 - provisions U/sec 68 of the Act and made addition of Rs.1,02,294/- and (ii) the AO dealt on sundry creditors balances at Para 4.2 of the order and found that there is no movement of creditors balances in F.Y 2015-16, FY.2016-17 &F.Y 2017-18 and issued show cause notice dated 24.12.2018 and since no explanations were filed by the assessee. The A.O considering facts of addition of some of the creditors in A.Y. 2010-11, made the differential addition of amount U/sec41(1) of the Act of Rs.75,31,111/- and assessed the total income of Rs.98,47,500/-and passed the order u/sec 143(3) of the Act dated 30.12.2018.
Aggrieved by the order, the assessee has filed an appeal before the CIT(A),whereas the CIT(A) has considered the grounds of appeal, statement of facts and findings of the AO and has issued notices of hearing and since there was no compliance by the assessee to notices. Therefore the CIT(A) considering the information on record has confirmed the action of the A.O and dismissed the appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal.
Shams Tabrez Gulam Madni Ansari, Mumbai. - 4 -
At the time of hearing, the Ld. AR submitted that the CIT(A) has erred in confirming the action of the Assessing officer overlooking the details filed in the assesseement proceedings. Further the assessee has a good case on merits and substantiate with the material evidences in the paper book and prayed for allowing the appeal. Per Contra, the Ld.DR supported the order of the CIT(A).
We heard the rival submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no appearance in spite of providing adequate opportunity of hearing and the notices were issued. Therefore, the CIT(A) was of the opinion that the assessee is not interested in prosecuting the appeal and dismissed the appeal ex-parte confirming the action of the assessing officer. The CIT(A) has issued the notice of hearing dealt at Page 2 Para 4 of the order i.e on 10- 11-2021, 3-11-2022.17.01.2023 and 28.02.2023 but there was no response and thus the CIT(A) came to a conclusion that the assessee is not interested and decided the appeal based on the information available
Shams Tabrez Gulam Madni Ansari, Mumbai. - 5 - on record. Whereas the assessee has raised grounds of appeal challenging the additions of the A.O and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the principles of natural justice shall provide with one more opportunity of hearing to the assessee to substantiate the case with evidences and information. Accordingly, we set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal. And the grounds of appeal of the assessee are allowed for statistical purposes.
6. In the result, the appeal filed by assessee is allowed for statistical purposes. Order pronounced in the open court on 11.10.2023.