AMIT KATARIA,GURGAON vs. ITO WARD - 3(4), GURGAON

With the assistance of the ld. AR for the assessee, we observe that the assessment order was framed at best judgment assessment under Section 144 of the Act in view of the non compliance of statutory notices issued by the Assessing Officer asking the assessee to support the return of income and file the necessary details to corroborate the transactions reflected in the return of income. In the first appeal also, the assessee has not attended the proceedings despite multiple notices as tabulated in paragraph 3.2 of the First Appellate order. Before the Tribunal, the assessee seeks restoration of the proceedings before the lower authorities to explain the case afresh.

We find that that assessee has not assigned any valid reason for continuing non compliance before the Assessing Officer or before the CIT(A). The Assessing Officer has passed the order summarily in the circumstances and the CIT(A) has also disposed off the first appeal in limine. The ld. counsel for the assessee strongly pitched for restoration of appeal before the lower authorities in larger interest of justice and to prevent miscarriage. It was suggested that some cost, at best, be imposed owing to delinquency shown in the matter but however the wholesale disallowances carried out would be totally disproportionate to the default committed due to such non compliance.

On perusal of the first appellate order, we find that the CIT(A) has declined to grant any relief to the assessee owing to the fact that assessee was totally non co-operative in the assessment proceedings despite several opportunities nor has complied before him in the first appellate proceedings. However, the CIT(A) has not rendered any decisions on merit. In our view, it was incumbent upon the CIT(A) to deal with grounds on merit after giving opportunity to the assessee in terms of Section 250(6) of the Act. However, we simultaneously appreciate the concerns of the Revenue on the lackadaisical and non co-operative attitude of the assessee towards the quantum proceedings.

In the totality of circumstances, we consider it expedient to restore the matter back to the file of the Assessing Officer in the larger interest of justice with a view to enable the assessee to avail opportunity once more. However such benevolence will be available at the cost of Rs.25,000/- to be deposited by the assessee within 1 month of service of this order to The Prime Minister Relief Fund. It shall be open to the Assessing Officer to make such inquiry as may be considered expedient in accordance with law on being satisfied towards payment of cost awarded. Needless to say, the assessee shall fully co-operate with the proceedings before the Assessing Officer without any demur and shall furnish the evidences/documents etc. as called for expeditiously.

Hence, the impugned order of the CIT(A) dated 14.10.2019 is set aside and all the issues raised in the captioned appeal are restored back to the file of the Assessing Officer for fresh adjudication in accordance with law after giving reasonable opportunity of hearing to the assessee.