SHRI BALU RAM SHARMA,AJMER vs. INCOME TAX OFFICER, WARD-2-2, AJMER

During the course of hearing, the ld. AR submitted that during the year under consideration, the assessee was engaged in business of trading of tractors under the name and style of M/s Maya Motors. It was submitted that the assessment was originally completed u/s 143(3) on 23.06.2017 wherein the ITO had asked for all income and expenditure reflected in the return filed for the year under consideration and after considering the details and submissions filed by the assessee, the assessment was completed u/s 143(3) of the Act. It was accordingly submitted that no new information or material has come in the possession of the Assessing officer basis which he has reopened the assessment by issuance of notice u/s 148 of the Act and it is clearly a case of change of opinion and which the Courts have held not permissible for reopening the assessment.

Per contra, the ld. DR submitted that the matter has been reopened on the ground that the account maintenance expenses amounting to Rs 36,000/- and advertisement expenses amounting to Rs 2,46,485/- were claimed by the assessee and the assessee had failed to deduct TDS on such expenses and the provisions of section 40(a)(ia) were clearly attracted and basis such information in possession of the Assessing officer, he has reopened the assessment proceedings by issuance of notice u/s 148 of the Act. It was submitted that it is a clearly a case of violation of provisions of section 40(a)(ia) of the Act and there cannot be a two opinions about it. It was accordingly submitted that there is no infirmity in action of the AO in reopening the assessment proceedings. Further, ld DR drawn our reference to the order of the ld CIT(A) wherein the assessee has stated that he wishes to file certain additional evidences in support of its claim of the aforesaid expenses as the assessee was not in possession of these documents when the Sh. Balu Ram Sharma, Ajmer vs. ITO, Ajmer assessment proceedings were finalized by the AO. It was accordingly submitted that where the details of the expenses were not filed by the assessee at first place, there is no question of forming any opinion by the AO and the contention of the ld AR regarding change of opinion is devoid of merits and the same may be rejected. Further, she relied on the order of the lower authorities.

We have heard the rival submissions and pursued the material available on record. We find that the matter has been listed for hearing on couple of occasions before the ld CIT(A), however, there was no compliance on part of the assessee except an application dated 14.01.2019 seeking condonation of delay in filing the appeal as well as permission seeking filing of additional evidence. The ld CIT(A) has condoned the delay, however, there is no finding regarding admission of additional evidence as sought by the assessee and the matter has been decided ex-parte by the ld CIT(A) summarily without deciding on merits. Therefore, in the interest of justice and fair play and especially where the matter has not been decided on merits, we believe that the assessee deserves one more opportunity to put forth his arguments and contentions and we accordingly set aside the matter to the file of the ld. CIT(A) to examine the matter afresh taking into consideration the additional evidence as filed by the assessee and after providing reasonable opportunity to the assessee. The contentions so advanced before us are therefore left open and the assessee is free to raise the same before the ld CIT(A). The assessee is also directed to appear before the ld. CIT(A) and file the necessary information and documentation in support of his contentions, as so advised and ensure in timely completion of the proceedings.