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Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad
Before: Shri Rama Kanta Panda & Shri Laliet Kumar
Before Shri Rama Kanta Panda, Accountant Member AND Shri Laliet Kumar, Judicial Member ITA.No.135/Hyd/2023 Assessment Year: 2007-08 Sri Kode Finvest Private Vs. Dy. Commissioner of Limited, Income Tax, 8-3-945, 104-105, Circle – 3(2), 1st Floor, PANCOM Hyderabad. Business Centre, Ameerpet, Hyderabad – 500073. PAN : AAACK9656P. (Appellant) (Respondent) Assessee by: None Revenue by: Sri K.P.R.R. Murthy Date of hearing: 18.04.2023 Date of pronouncement: 19.04.2023 O R D E R PER LALIET KUMAR, J.M.
This appeal is filed by the assessee, feeling aggrieved by the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dt.04.01.2023 invoking proceedings under section 143(3) of the Income Tax Act, 1961 (in short, “the Act”). “1. The ld.CIT(A) confirmed the assessment order without waiting for the written submissions despite giving date for the same.
2. The ld.CIT(A) vide notice dated 22.12.2022 gave time upto 06.01.2023 to file submissions. However, order was passed on 04.01.2023 before the appellant could submit its written submissions.
3. The Assessing Officer erred in adding back the depreciation of Rs.3,47,290/- to the profit as per Profit and Loss account in computing book profits.
The brief facts of the case are that assessee company, which is an Investment company carrying on business in shares, filed its return of income for A.Y. 2007-08 declaring loss of Rs.3,35,100/- under normal provisions and income of Rs.37,46,304/- u/s 115JB of the Act. The return of income was processed and was taken up for scrutiny. In response to notice u/s 143(2) of the Act, assessee company furnished information as called for. After perusal of the details submitted by the assessee company, it was asked to explain as to why the provisions of section 14A should not be applied against it and part of expenditure should not be disallowed. In reply, assessee company submitted that the investment in share and mutual funds were out of its own sources and no expenditure was incurred by way of interest on borrowals or otherwise for examining the exempted income, which was not accepted by the Assessing Officer. Finally, the Assessing Officer had completed the assessment interalia making addition of Rs.3,47,290/- u/s 115JB of the Act and Rs.8,80,949/- u/s 14A of the Act.
Feeling aggrieved by the order passed by the assessing officer, assessee filed appeal before the Ld. CIT(A) / NFAC, who granted partial relief to the assessee.
Feeling aggrieved with the order of ld.CIT(A)/NFAC, assessee is now in appeal before us.
In this appeal, none appeared at the time of hearing on behalf of the assessee. However, the grounds of appeal shows that the basic ground urged by the assessee is that the ld.CIT(A) after receipt of the proceedings by NFAC had issued a notice for hearing on 06.01.2023 whereby the assessee was called upon to 3 furnish the evidence / submissions. Before the assessee could have submitted evidence / submissions, the ld.CIT(A) / NFAC passed an order against the assessee. In light of the above, it was prayed that the matter may kindly be remitted back to the ld.CIT(A) for deciding the issue afresh.
6. Per contra, the ld. DR had vehemently submitted that nothing has been brought to the notice of the Tribunal whereby it can be proved that the notice of hearing was fixed at 06.01.2023 by the ld.CIT(A) / NFAC before the order was passed by the NFAC.
We have heard the ld. DR and perused the material on record. The perusal of the order clearly shows that the appeal was assigned to the NFAC after being transferred / migrated vide notification No.139/2021 of CBDT dt.28.12.2021. However, from the perusal of the order, it is not discernible as to any notice was issued by the NFAC after it was received on migration to NFAC Scheme. Further, the order is conspicuously silent about the date of hearing when the appeal was heard by the NFAC after issuing notice to the assessee, if any, and however, NFAC vaguely mentioned that the notice was served through ITBA Portal. Further as pointed in grounds that notice was issued on 22.12.2022 for fixing hearing on 06.01.2023, however to our surprise, the order was passed on 04.01.2023.
In light of the above, we deem it appropriate to remand back the matter to the file of ld.CIT(A)/NFAC for deciding the issue afresh. Needless to say that while doing so, the ld.CIT(A) / NFAC shall first verify from the record whether the submission of the assessee that notice dt.22.12.2022 was issued for hearing on 06.01.2023 was correct or not. If on verification, it is found to be correct then the order dt.04.01.2023, shall be deemed to be 4 quashed. However, on verification of the fact that the above said contention is found incorrect, then the ld.CIT(A)/NFAC shall be in its power to pass appropriate order in accordance with the law. In case, the contention is found to be correct, then the NFAC / ld.CIT(A) shall pass fresh speaking order after affording opportunity of hearing to the assessee. Thus, the appeal of the assessee is allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.