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Income Tax Appellate Tribunal, MUMBAI BENCH “D”, MUMBAI
Before: SHRI KULDIP SINGH & SHRI GAGAN GOYAL
O R D E R Per : Kuldip Singh, Judicial Member: At the very outset, it has come to the notice of the Bench that in the present appeal filed by the appellant, Shri Mafatsingh Mansingh Parmar (hereinafter referred to as ‘the assessee’) there is a day of 39 days, which the assessee has sought to condone by way of filing application supported with an affidavit on the grounds inter-alia that the assessee has received the impugned order passed by the Ld. CIT(A) on 25.08.2022; that the assessee has received a certificate under section 197 from the M/s. Romex Infradevelopers Pvt. Ltd. for authorizing to deduct tax at 0% duly issued by Tax Deducted at Source (TDS) Department, Kolkata but the Ld. CIT(A) has not deleted the addition of Rs.7,38,17,700/- under section 40(a)(ia) of the Income Tax Act, 1961 (for short ‘the Act’); that the assessee has acted in good faith and made payment in normal course of business but while making payment to M/s. Romex Infradevelopers Pvt. Ltd. he was not aware of any issue as regards genuineness of the certificate produced before him.
2. However, on the other hand, the Ld. D.R. for the Revenue opposed the application for condonation of delay on the ground that the late filing of appeals in this case is apparently malafide due to callous attitude of the assessee and prayed for dismissal of the application.
Keeping in view the fact that when the assessee was in possession of certificate under section 197 from M/s. Romex Infradevelopers Pvt. Ltd. authorizing to deduct tax at 0% issued by TDS Department, Kolkata non filing of the appeal against the impugned order passed by the Ld. CIT(A) appears to be in good faith, thus a sufficient cause to condone the delay of 39 days. Consequently, the delay of 39 days in filing the present appeal by the assessee is hereby condoned and appeal is ordered to be registered and is being heard on merits.
The assessee by filing the present appeal, sought to set aside the impugned order dated 25.08.2022 passed by the National Faceless Appeal Centre(NFAC) [Commissioner of Income Tax (Appeals), Delhi] (hereinafter referred to as CIT(A)] qua the assessment year 2013-14 on the grounds inter-alia that :-
“1. On the facts of the case the learned A.O. erred in adding and CIT (A) erred confirming the addition of Rs.7,38,17,700/- being contract charges paid to Romnex Infradeveloper Pvt Ltd. when M/s Romex Infradeveloper Pvt Ltd has given certificate of deduction at 0% rate issued by the department and when the appellant acted as per law in not deducting tax at source. He had no way of anticipating that learned AO will conclude that genuineness of said certificate is debatable or doubtful.
On the facts of the case the learned CIT (A) has erred in not granting benefit of proviso to section 40(a)(ia) when the copy of ITR and duly audited accounts which included receipts from appellant were submitted during the proceedings.”
Briefly stated facts necessary for consideration and adjudication of the issues at hand are : the assessee is into the business of construction under the name and style of Kamal Enterprises having shown his business income at Rs.72,14,333/-, income from house property to the tune of Rs.63,000/- and income from other sources to the tune of Rs.3,27,979/- and after availing deduction under chapter VIA to the tune of Rs.1,29,665/- assessee declared total income at Rs.74,75,650/- from P &L account. The Assessing Officer (AO) noticed an amount of Rs.7,38,17,700/- towards labour charges under section 194C of the Act, payment made on account of contractor/sub contractor to M/s. Romex Infradevelopers Pvt. Ltd., Kolkata on which the assessee has not deducted any TDS nor deposited in the government account. Rejecting the contentions raised by the assessee the AO proceeded to make addition of Rs.7,38,17,700/-. The AO also disallowed an amount of Rs.13,92,101/- on account of various expenses claimed by the assessee and thereby framed the assessment under section 143(3) of the Act.
The assessee carried the matter before the Ld. CIT(A) by way of filing appeal who has confirmed the addition by partly allowing the appeal. Feeling aggrieved with the impugned order passed by the Ld. CIT(A) the assessee has come up before the Tribunal by way of filing present appeal.
The assessee has failed to appear before the Bench to pursue the present appeal despite issuance of notices through RPAD, which have not been received back served/unserved. Since a period of more than 30 days has already elapsed the assessee is presumed to have been served but has not preferred to put in appearance, the Bench has decided to dispose of the present appeal on the basis of material available on record with the assistance of Ld. D.R. for the Revenue.
We have heard the Ld. D.R. for the Revenue, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light of the facts and circumstances of the case and case law relied upon.
Bare perusal of para 3 of the impugned order passed by the Ld. CIT(A) goes to prove that 7 notices were stated to have been issued to the assessee on 23.06.2017, 24.08.2017, 02.08.2019, 22.12.2020, 27.10.2021, 11.01.2022 and 14.07.2022, but on failure of the assessee to put in appearance the Ld. CIT(A) passed the impugned order, though on merits at the back of the assessee no material whatsoever has been brought on record by the Ld. CIT(A) if the alleged notices stated to have been issued to the assessee were ever served upon the assessee nor there is any satisfaction recorded by Ld. CIT(A) that assessee has been duly served. Even mode of issuance of the notice has not been brought on record so it appears that the assessee has not been duly served in this case.
Furthermore, perusal of the impugned order passed by the Ld. CIT(A) on merits also goes to prove that he has merely relied upon the assessment order. Even otherwise without explanation or assistance provided by the assessee it is difficult to decide the issue on merits. So we are of the considered view that when adequate opportunity of being heard has not been given to the assessee nor any material has been brought on record if the assessee was ever served upon, the impugned order by the Ld. CIT(A) is not sustainable in the eyes of law, hence hereby set aside and remitted back to the Ld. CIT(A) to decide afresh after providing adequate opportunity of being heard to the assessee.
Resultantly, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 28.02.2023.