KHIVRAJ& CO,CHENNAI vs. DCIT, NON- CORPORATE CIRCLE 5(1), CHENNAI, CHENNAI

Both the appeals filed by the assessee are directed against separate orders of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi dated 09.03.2023 and 24.03.2023 relevant to the assessment years 2008-09 and 2009-10 respectively.

Brief facts of the case are that the assessee has filed the return of income for the assessment year 2008-09 on 14.08.2008 declaring income of ₹.67,86253/-. The return filed by the assessee was processed under section 143(1) of the Income Tax Act, 1961 [“Act” in short]. Subsequently, the case of the assessee was selected for scrutiny and notice under section 143(2) of the Act dated 05.07.2010 was issued and duly served on the assessee. After following due procedures and considering the details furnished by the assessee, the Assessing Officer has completed the assessment under section 143(3) of the Act dated 30.12.2010 assessing total income of the assessee at ₹.2,35,17,815/- after making various addition.

Thereafter, notice under section 148 of the Act dated 17.10.2014 for reopening of assessment has been issued since the Assessing Officer has reasons to believe that the income chargeable to tax has escaped assessment within the meaning of section 147 of the Act. Vide letter dated 21.11.2014, the assessee requested to furnish the reasons for reopening of the assessment. Against furnishing of reasons recorded for reopening of assessment and notice issued under section 142(1) of the Act dated 09.07.2015, the assessee filed a details reply dated 17.07.2015 before the Assessing Officer. After considering the submissions of the assessee, the Assessing Officer has completed the assessment order under section 143(3) r.w.s. 147 of the Act dated 29.02.2016.

Similarly, for the assessment year 2009-10, the assessee filed its return of income on 28.08.2009 declaring NIL income and the return was processed under section 143(1) of the Act. Thereafter, the case was selected for scrutiny and by following due procedures, the assessment under section 143(3) of the Act dated 03.05.2011 was completed by accepting the returned income of the assessee. Thereafter, the Assessing Officer issued notice under section 148 of the Act dated 26.03.2016 and concluded the assessment under section 143(3) r.w.s. 147 of the Act dated 30.12.2016.

The assessee carried the matter in appeal before the ld. CIT(A) for both the assessment years under appeal. Since there was no response against the notices issued by the ld. CIT(A), the ld. CIT(A) dismissed both the appeals filed by the assessee.

On being aggrieved, the assessee is in appeal before the Tribunal for both the assessment years under appeal. The ld. Counsel for the assessee has submitted that while concluding the appellate order, the ld. CIT(A) has failed to adjudicate the legal issue raised in the appeals of the assessee with regard to reopening of assessment under section 147 of the Act. Despite the assessee has sought for adjournment, the ld. CIT(A) has not provided the same before completing the appellate order and prayed that the matter may be remitted back to the file of the ld. CIT(A) for fresh consideration on merits by affording an opportunity of being heard to the assessee.

On the other hand, the ld. DR fairly conceded that the matters may be remitted back to the file of the ld. CIT(A) for both the assessment years.

We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. Against the assessment orders passed under section 143(3) r.w.s. 147 of the Act, the assessee has challenged the reopening of assessment before the ld. CIT(A). Without adjudicating the legal issue, the ld. CIT(A) concluded his appellate order by dismissing the appeals of the assessee on the ground that the assessee has not furnished written submissions/paper book for the grounds raised. We find that the ld. CIT(A) should have adjudicated the legal issue raised by the assessee while concluding the appellate order. Accordingly, we set aside the orders of the ld. CIT(A) for both the assessment years and remit the matter back to the file of the ld. CIT(A) to adjudicate the legal issue along with other grounds raised by the assessee afresh in accordance with law by considering the details as may be furnished by the assessee. The assessee is also directed to furnish complete details before the ld. CIT(A) for adjudicating the issues raised in its appeals for both the assessment years.

In the result, both the appeals filed by the assessee are allowed for statistical purposes.