OM VIMLA MEDICLINIC,DELHI vs. WARD EXEMP 2(4), DELHI

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ITA 765/DEL/2022Status: DisposedITAT Delhi24 June 2022AY 2018-194 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) disposed of the appeal without providing a reasonable opportunity of being heard to the assessee, violating principles of natural justice. The CIT(A) also failed to address issues with visible attachments.

What were the facts?

The assessee, a charitable trust, claimed deduction under Section 11 but filed Form-10 late, leading the AO to deny the deduction and tax the accumulated income. The CIT(A) upheld this addition.

What were the issues?

Whether the CIT(A) violated principles of natural justice by disposing of the appeal ex-parte without granting a reasonable opportunity of hearing. Whether the CIT(A) properly considered the assessee's submissions and uploaded documents.

Which sections of the Income-tax Act were involved?

Section 11,Section 12A,Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI

Before: SHRI SAKTIJIT DEY

Hearing: 08.06.2022Pronounced: 24.06.2022

Date of hearing 08.06.2022 Date of pronouncement 24.06.2022 ORDER This is an appeal by the assessee against order dated 15.03.2022 passed by National Faceless Appeal Centre (NFAC), Delhi, for the assessment year 2018-19.

2.

When the appeal was called for hearing, none appeared on behalf of the assessee. However, keeping in view the fact that the assessee has challenged the ex-parte disposal of appeal by learned Commissioner (Appeals), I proceed to dispose of the appeal ex-parte qua the assessee after hearing learned Departmental Representative and based on the materials on record.

3.

Briefly the facts are, the assesse is stated to be a public charitable trust registered under section 12A and 80G of the Income-tax Act, 1961 (for short ‘the Act’). For the assessment year under dispute, the assessee filed its return of income on 25.03.2019 declaring nil income after claiming deduction under section 11 of the Act. In course of assessment proceeding, the Assessing Officer noticed that the assessee has furnished Form- 10 on 04.03.2019 exercising its option to accumulate or set apart unutilized income to the subsequent years, which is beyond the prescribed time limit. Thus, due to delay in filing of Form-10, the Assessing Officer denied the benefit of section 11(2) to the assessee.

Accordingly, the accumulated unutilized income/fund of Rs.36,59,504/- was treated as income of the assessee and subjected to tax. Against the assessment order so passed, the assessee preferred an appeal before learned Commissioner (Appeals). By the impugned order, learned Commissioner (Appeals) disposed of the appeal by upholding the addition made by the Assessing Officer.

4.

I have heard learned Departmental Representative and perused the materials on record. Specific issue raised by the assessee in ground no. 1 is, learned Commissioner (Appeals) has not allowed reasonable opportunity of being heard to the assessee before disposing of the appeal. On a perusal of the impugned order of learned Commissioner (Appeals) and, more particularly, the observation made by learned Commissioner (Appeals) in paragraph 3 of the impugned order, it is observed, a notice of hearing was issued to the assessee on 02.03.2022 with a direction to appear in the hearing of the appeal on or before 11.03.2022. As it appears, the assessee responded to the notice on the very same day.

However, without granting any further opportunity to the assessee, learned Commissioner (Appeals) proceeded to dispose of the appeal. This, in my view, is not in accordance with principles of natural justice. More so, considering the fact that the first appellate authority has observed in the body of the order that certain attachments are not visible in ITBA. When the attachments uploaded to the system of the department were not visible, better course would have been to call upon the assessee to furnish these documents again. Without providing any such opportunity, learned Commissioner (Appeals) has disposed of the appeal. Thus, prima facie, it appears that the appeal was disposed of without considering the material facts.

4. In view of the aforesaid, I set aside the impugned order of learned Commissioner (Appeals) and restore the matter back to him for de novo adjudication after providing due opportunity of being heard to the assessee. Accordingly, grounds are allowed for statistical purposes.

5.

In the result, the appeal is allowed for statistical purposes.

Order pronounced in the open court on 24th June, 2022

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