ARYAN ENGINEERING SERVICES,SINGRAULI vs. INCOME TAX OFFICER, WARD, SIGRAULI

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ITA 32/JAB/2023Status: DisposedITAT Jabalpur20 September 2023AY 2017-184 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the CIT(A)'s order and remanded the case back for fresh adjudication. It held that principles of natural justice require providing one more opportunity for the assessee to present their case with evidence.

What were the facts?

The assessee, a partnership firm, failed to comply with notices issued by the Assessing Officer (AO) for A.Y. 2017-18. The AO made a best judgment assessment under Section 144, adding unexplained salary and provident fund payments. The CIT(A) dismissed the assessee's appeal ex-parte due to non-compliance.

What were the issues?

Whether the CIT(A) was justified in dismissing the appeal ex-parte without considering potential reasons for non-appearance, and whether the assessee should be granted another opportunity to present their case.

Which sections of the Income-tax Act were involved?

Section 144,Section 69C,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB” BENCH, JABALPUR

Hearing: 18.09.2023Pronounced: 20.09.2023

O R D E R

PER PAVAN KUMAR GADALE JM:

1.

The appeal is filed by the assessee against the order of the National Faceless Appeal Centre, Delhi /CIT(A) and passed the order u/sec144 and Sec 250 of the Act. The assessee has raised the grounds of appeal challenging the ex parte order of the CIT(A) passed confirming the additions of the Assessing officer.

Aryan Engineering Services, - 2 -

2.

The brief facts of the case are that, the assessee is a partnership firm and has filed the return of income for the A.Y 2017-18 on 6-11-2017 disclosing a total income of Rs.1,50,340/-.The case was selected for scrutiny and notice U/sec 143(2) and U/sec142(1) of the Act was issued and there was no compliance to notice issued U/sec142(1) of the Act. The Assessing Officer (A.O) found that the assessee has paid salary and contribution to the provident fund aggregating to Rs.93,95,633/- and the sources and utilization of funds making the payments remained un explained. Hence the AO has invoked the provisions of Sec. 144 of the Act and made best judgment assessment considering the material available on record made addition U/sec69C of the Act and assessed the total income of Rs.95,45,973/- and passed the order u/s 144 of the Act dated 10.12.2019.

3.

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

Aryan Engineering Services, - 3 - by the order of the CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal.

4.

At the time of hearing, none appeared on behalf of the assessee. Per Contra, the Ld. DR supported the order of the CIT(A).

5.

We heard the Ld.DR submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no appearance/submissions 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 Ld.CIT(A) has issued the notices of hearing on various dates on 29-1-2020, 21-12-2021,22-03-2022&12- 09-2022 referred at Page 3 Para 4 of the order, but there was no response and thus the Ld.CIT(A) came to a conclusion that the assessee is not interested and decided the appeal based on the information available on record. Whereas the assessee has raised grounds of appeal challenging the additions by the A.O and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the principles of natural

Aryan Engineering Services, - 4 - 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 on merits. Further the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal. And we allow the grounds of appeal of the assessee for statistical purposes.

6.

In the result, the both the appeal filed by the assessee is allowed for statistical purposes.

Orders pronounced in the open court on 20.09.2023

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