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Income Tax Appellate Tribunal, CIRCUIT BENCH,DB, VARANASI
Before: SHRIVIJAY PAL RAO & SHRI RAMIT KOCHAR
I.T.A. Nos.36, 37, 38, 40 & 41/VNS/2022 Kamal Kumar Agrawal (HUF) v. ACIT,Central Circle, Varanasi 2 arise from common appellate order dated 25.08.2022 passed by ld. Commissioner of Income-tax, National Faceless Appeal Centre(NFAC), Delhi (hereinafter called “the CIT(A)”) . All these appeals were heard together and are disposed off by this common order. First we will take up for assessment year 2013-14 as lead appeal, and our decision in I.T.A. No.36/VNS/2022 shall apply mutatis mutandis to all the other four appeals , as the similar factual situation prevails in rest of the four appeals for assessment year 2014-15 to 2017-18. for A.Y.2013-14 2. The brief facts of the case are that the assessee filed return of income u/s 139 on 23/03/2014 declaring total income at Rs.2,09,155/-. A search action u/s 132 of the Act took place on residential premises on 17/11/2017. During the search, it came to notice of the Revenue that the assessee is filing return of income declaring presumptive income u/s 44AD. However, not even a single bill/voucher, paper, employee details etc. were found during the search. Therefore, a Notice u/s 148 was issued by Assessing Officer to the assessee on 07/05/2019 after taking statutory approval from the Pr. CIT (Central) Lucknow. The assessee filed return of income on 21/11/2019 in pursuance to notice u/s 148, declaring total income at Rs.2,09,155/- . Statutory notice u/s 143(2) and 142(1) were issued by the AO from time to time, as are recorded in the assessment order. The assessee objected to the reopening of the case by the AO by invoking provisions of Section 147, which objections were disposed off by the AO vide orders dated 16.09.2020. The assessee also did not comply with several notices issued by the Assessing Officer. The details are recorded in assessment order. Ultimately, the Assessing Officer assessed the income of the assessee at Rs.25,43,010/- as against the declared income of , 37, 38, 40 & 41/VNS/2022 Kamal Kumar Agrawal (HUF) v. ACIT,Central Circle, Varanasi 3 Rs.2,09,155/-, wherein two additions were made by AO; firstly, u/s 68 on bogus income u/s 44AD and second addition was made u/s 68 on bogus LTCG, vide assessment order dated 29.12.2020 passed u/s 147 read with Section 143(3) of the 1961 Act. The AO has discussed both these additions in details in his assessment order dated 29.12.2020 passed u/s. 147 read with Section 143(3) of the 1961 Act (Documentation Identification No. 20131332135). The assessee being aggrieved with the assessment order passed by the Assessing Officer, filed first appeal with learned CIT(A) , which stood dismissed by ld. CIT(A) vide appellate order dated 25th August, 2022( DIN and Order No. ITBA/NFAC/S/250/2022-23/1044928366(1)).
Being aggrieved by dismissal of appeal by ld. CIT(A), the assessee has filed second appeal before the Tribunal. At the outset, learned counsel for the assessee submitted before the Bench that learned CIT(A) has passed an ex-parte order dated 25th August, 2022 wherein only one opportunity of hearing was granted to the assessee by ld. CIT(A) before dismissing the appeal of the assessee. Learned counsel for the assessee has filed paper book containing five pages before tribunal(placed on record in file) in which screen shot of details of notices issued, adjournment applicationfiled etc. before ld. CIT(A), as downloaded from e-portalof income tax department is enclosed. The ld. Counsel for the assessee drew our attention to the efiling portal of the department w.r.t. first appellate proceedings before ld. CIT(A) for ay: 2013-14 , and it was submitted that the first notice of hearing was issued by ld. CIT(A) on 8th August, 2022 fixing the date of hearing for 16th August, 2022. It was submitted by ld. Counsel for the assessee that on 16th August, 2022, the assessee submitted adjournment application on the ground that the counsel of the assessee is pre-occupied with the tax return filing activities referred to in tax audit of firms and company, and hence , 37, 38, 40 & 41/VNS/2022 Kamal Kumar Agrawal (HUF) v. ACIT,Central Circle, Varanasi 4 prayers were made before ld. CIT(A) to grant further time of 15 days until 31.08.2022. It was submitted that learned CIT(A) did not grant any further time , and dismissed the appeal filed by the assessee ex-parte, vide appellate order dated 25th August, 2022. The learned counsel for the assessee stated before the Bench , that only one notice of hearing was issued by ld. CIT(A) on 08.08.2022 and the appeal of the assessee stood dismissed by ld. CIT(A) , and that principles of natural justice stood breached . The ld. Counsel for the assessee made prayers before the Bench that the matter can be remitted back to file of ld. CIT(A) for fresh adjudication of the appeal of the assessee on merit in accordance with law , after complying with principles of natural justice . The ld. Counsel for the assessee stated that the assessee will duly appear and submit necessary explanations/evidences in its defense before ld. CIT(A) , which can then be adjudicated on merits in accordance by law by ld. CIT(A). The ld. Sr. DR could not controvert the fact that only one notice of hearing was issued by ld. CIT(A) on 08.08.2022 fixing the date of hearing to 16.08.2022, and that the appeal stood dismissed by ld. CIT(A) on 25.08.2022 despite adjournment application moved by assessee on 16.08.2022 seeking time till 31.08.2022. The Learned Sr. D.R. fairly submitted that the Department has no objection if the matter can go back to the file of learned CIT(A) for fresh adjudication.
After considering the arguments of both the parties and material on record and without commenting on the merits of the issue in this appeal , we have observed that the assessee filed its first appeal with ld. CIT(A) , who dismissed the appeal of the assessee by granting only one opportunity of hearing wherein notice of hearing was issued by ld. CIT(A) on 08.08.2022 fixing date of hearing for 16.08.2022. The assessee moved adjournment application on 16.08.2022, requesting time till 31.08.2022 to file its , 37, 38, 40 & 41/VNS/2022 Kamal Kumar Agrawal (HUF) v. ACIT,Central Circle, Varanasi 5 submissions, but ld. CIT(A) dismissed the appeal ex-parte on 25.08.2022. We are of the considered view that there is clearly an infringement of principles of natural justice, and effective hearing was not granted to the assessee by ld. CIT(A) wherein the appeal of the assessee was dismissed by ld. CIT(A) in haste. The principles of natural justice by granting an fair and effective hearing before condemning a person, is one of the important pillar in the justice deliver system, and the order passed in breach thereof cannot be sustained. Now both the parties before us are at-idem that matter needs to be restored to the file of ld. CIT(A) for fresh adjudication of the appeal filed by the assessee with ld. CIT(A), on merit in accordance with law. Thus, we are restoring the matter back to the file of learned CIT(A) for fresh adjudication of the appeal of the assessee on merit in accordance with law. Needless to say, the learned CIT(A) shall afford proper and reasonable opportunity of being heard to the assessee in set aside remand proceedings and shall readjudicate the appeal of the assessee on merit in accordance with law. We once again clarify that we have not commented on the merits of the issue’s arising in this appeal. The appeal of the assesse is allowed for statistical purposes. We order accordingly.
In the result, appeal filed by the assessee in for assessment year 2013-14 is allowed for statistical purposes. We order accordingly.
Since factual position in respect of all the rest of the appeals in for assessment year 2015-16, ITA No. 38/VNS/2022 for assessment year 2017-18, ITA No. 40/VNS/2022 for assessment year 2014- 15 and ITA No. 41/VNS/2022 for assessment year 2016-17 so far as breach of principles of natural justice by ld. CIT(A) , are similar as the facts in ITA No. 36/VNS/2022 for assessment year 2013-14, and hence our decision in I.T.A. Nos.36, 37, 38, 40 & 41/VNS/2022 Kamal Kumar Agrawal (HUF) v. ACIT,Central Circle, Varanasi 6 for assessment year 2013-14 shall apply mutatis mutandis to the appeals in the ITA NO. 37/VNS/2022 for assessment year 2015-16, ITA No. 38/VNS/2022 for assessment year 2017-18, ITA No. 40/VNS/2022 for assessment year 2014-15 and ITA No. 41/VNS/2022 for assessment year 2016-17 . Thus, all these four appeals filed by the assessee are allowed for statistical purposes. We order accordingly.
In the result, appeal filed by the assessee in for assessment year 2015-16, ITA No. 38/VNS/2022 for assessment year 2017- 18, ITA No. 40/VNS/2022 for assessment year 2014-15 and ITA No. 41/VNS/2022 for assessment year 2016-17 are allowed for statistical purposes. We order accordingly
In the result, all the five appeals filed by the assessee in for assessment year 2013-14, ITA NO. 37/VNS/2022 for assessment year 2015-16, ITA No. 38/VNS/2022 for assessment year 2017- 18, ITA No. 40/VNS/2022 for assessment year 2014-15 and ITA No. 41/VNS/2022 for assessment year 2016-17 are allowed for statistical purposes. We order accordingly
Order pronounced in Open Court on11/01/2023 at Varanasi, U.P, after the conclusion of hearing in the presence of ld. Sr. DR and the ld. counsel of the assessee, and reduced to writing and signed on 13.01.2023.