M/S KETAN ENGINEERING SERVICES PVT. LTD.,SURAT vs. INCOME TAX OFFICER, WARD-1(1)(3), SURAT

Captioned appeal filed by the assessee pertaining to the Assessment Year 2014-15, is directed against the order passed by the ld.Commissioner of Income Tax(Appeals)-1, Surat dated 18.12.2018, which in turn arises out of an assessment order passed by the Assessing Officer, under section 143(3) of the Income Tax Act, 1961, dated 09.12.2016.

At the outset itself, Shri Shaunak Zaveri, ld.Counsel for the assessee assailed the impugned order by contending that the assessee could not represent his case before the ld.Commissioner of Income Tax(Appeals) [Ld.CIT(A)] and the order being an ex-parte order, stood vitiated on account of violation of principle of natural justice. The ld.Counsel submitted that during the appellate proceedings, assessee has not received notice from the ld.CIT(A), therefore he could not attend the proceedings before the ld.CIT(A). The ld.Counsel took us through the order of the ld.CIT(A), vide para no.5.1.1. at page no.2 wherein the ld.CIT(A) has for A.Y. 2014-15 M/s.Ketan Engineering Services Pvt. Ltd., mentioned that assessee was given opportunities on 12.07.2018, 16.08.2018, 04.09.2018, 25.09.2018, 31.10.2018 and 30.11.2018. However, these notices were not served on the assessee.

The ld.Counsel further submitted that during the appellate proceedings the last notice issued by the ld.CIT(A) on 30.11.2018 was not served on the assessee, therefore assessee could not attend the hearing before ld.CIT(A). Hence, ld.Counsel prayed the Bench that an opportunity to contest the appeal before the First Appellate Authority may be granted to the assessee.

On the other hand, the ld.Departmental Representative (Sr. DR) for the Revenue has fairly agreed that order passed by the ld.CIT(A) is an ex-parte order without adjudicating the issues involved, on merits. Therefore, the appeal may be remitted back to the file of the ld.CIT(A) for de novo adjudication.

We have heard both the parties and perused the material available on record, we note that in the assessee’s case under consideration, the assessment was carried out under section 143(3) of the Income Tax Act, 1961 and the impugned order passed by the ld.CIT(A), is an ex-parte order and non-speaking order, therefore, we do not wish to make any comments on the merits of the grounds raised by the assessee. We note that order passed by the ld.CIT(A) is not in accordance with the mandate of the provisions of section 250(6) of the Income Tax Act, 1961 which reads as follows “The order of ld.Commissioner of Income Tax (Appeals) disposing of the appeal shall be in writing and shall state the point for determination, the decision thereon and the reasons for the decision”.

We note that assessee has participated in the appellate proceedings and sought adjournment, however, notice of hearing dated 30.11.2018 was not served on the assessee, therefore, the assessee has not given sufficient opportunity of being heard and could not plead his case successfully before the ld.CIT(A). We note that ld.CIT(A) did not discuss the assessee’s case on merits based on the material available before him, hence, it is a violation of principle of natural justice. for A.Y. 2014-15 M/s.Ketan Engineering Services Pvt. Ltd., We note that it is settled law that principle of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard to contest his case. Therefore, without delving much deeper in the merits of the case, in the interest of the justice, we restore the matter back to the file of ld.CIT(A) for de novo adjudication and pass a speaking order after according sufficient opportunity of being heard to the assessee, who in turn, also directed to contest his stand forthwith. Therefore, we deem it fit and proper to set-aside the order of ld.CIT(A) and remit the matter back to the file of the ld.CIT(A), to adjudicate the issue on merits. For statistical purposes the appeal of the assessee is treated as allowed.

In the result, appeal of the assessee is allowed for statistical purposes.