FOX MANDAL & CO.,NEW DELHI vs. ACIT CIRCLE-61(1), NEW DELHI

ORDER PER ANADEE NATH MISSHRA, AM: (A) This appeal by Assessee is filed against the order of Learned

Commissioner of Income Tax (Appeals)-36, New Delhi [Ld. CIT(A)”, for short], dated 26/07/2019 for Assessment Year 2012-13.

Grounds taken in this appeal are as under:

“1. That in view of the facts and circumstances of the case and under the law, the CIT(A) erred by not providing reasonable opportunity of being heard, a must in law, as settled by various courts from time to time, hence, the order so passed is arbitrary, unjust and bad in law.

(A.1) In the course of appellate proceedings in Income Tax Appellate Tribunal (‘ITAT’, for short), a letter was filed from the assessee’s side, containing the following submissions:

“In the above matter it is humbly submitted that ex-parte order has been passed by CIT(A), New Delhi against the assessee, on account of rejection of adjournment filed by him being out of Delhi, therefore in the interest of justice the appeal be kindly restored to the file of CIT(A) for fresh adjudication.”

(B) In this case, assessment order dated 30/03/2015 was passed by the Assessing Officer u/s 143(3) of Income tax Act (‘IT Act’, for short) wherein the total income of the assessee was assessed at Rs.1,28,64,463/- (rounded off to Rs.1,28,64,460/-).

Aggrieved, the assessee filed an appeal in the office of learned CIT(A). Vide impugned appellate order dated 26/07/2019, the learned CIT(A) dismissed the assesse’s appeal. It is found from perusal of records that the learned CIT(A) passed an ex-parte order.

The last hearing fixed in the office of the learned CIT(A) was vide notice dated 17/07/2019, whereby hearing was fixed on 26/07/2019. The notice was sent by speed post. On 26/07/2019 an adjournment was filed from the assessee’s side but the learned CIT(A) rejected the request for adjournment and proceeded to decide the appeal ex-parte qua the appellant assessee. On perusal of the order of the learned CIT(A), we find that she has not discussed the grounds on which the adjournment was sought by the appellant assessee. In the absence of this discussion, learned CIT(A) has failed to establish that rejection of adjournment by the learned CIT(A) was just and proper in the facts and circumstances of the case. Further, considering the normal time taken by Postal Authorities in service of mail by speed post, the duration of time between date of notice (17/07/2019) and date of hearing (26/07/2019) seems to be inadequate and we are of the view that the inadequate duration of time did not constitute reasonable opportunity to the assessee.

(B.1) Further, we find that the learned CIT(A) has dismissed the assessee’s appeal in a summary manner; and has not passed speaking order on the various grounds of appeal. Under section 250(6) of the Income Tax Act, the learned CIT(A) is duty bound to dispose off the appeal stating the points for determination, the decision thereon and the reason for the decision. As the learned CIT(A) dismissed the assessee’s appeal in a summary manner without passing a speaking order on the various grounds of appeal, we infer that requirement u/s 250(6) of IT Act was not fulfilled by the learned CIT(A).

(B.2) At the time of hearing before us, the learned Counsel for the assessee submitted that the issues in dispute in the present appeal may be restored to the file of the learned CIT(A) for passing fresh order in accordance with law after providing reasonable opportunity to the assessee. The learned Senior DR for Revenue relied on the orders of the learned CIT(A) and the Assessing Officer.

(B.2.1) We have heard both sides. We have perused the materials on record. In the light of the foregoing discussion in paragraph (B) of this order, we are of the view that the learned CIT(A) did not provide reasonable opportunity to the assessee in respect of notice of hearing dated 17/07/2019, whereby hearing was fixed on 26/07/2019. Further, we have already noted earlier that learned CIT(A) has failed to establish that rejection of adjournment in respect of hearing fixed on 26/07/2019 by aforesaid notice dated 17/07/2019, was just and proper in the facts and circumstances of the case. We are of the opinion, in view of the foregoing, that rejection of adjournment sought by the assessee, amounted to violation of principle of natural justice. Further, as discussed earlier in the foregoing paragraph (B.1) of this order, the requirement prescribed u/s 250(6) of Income tax Act has not been fulfilled by the learned CIT(A). In view of the foregoing, and in the specific facts and circumstances of the present appeal before us, we set aside the impugned appellate order dated 26/07/2019 of the learned CIT(A) and we restore all the issues in dispute in the present appeal before us, to the file of the learned CIT(A) with the direction to pass denovo appellate order in accordance with law, after providing reasonable opportunity to the assessee; and further, in conformity with principles of natural justice; and furthermore, having due regard for requirements prescribed u/s 250(6) of IT Act.

(C) For statistical purposes, the appeal is treated as partly allowed.

This order was already pronounced orally on 28th November, 2022 in Open Court, in the presence of representatives of both sides, after conclusion of the hearing. Now this order in writing is signed today on 29/11/2022.