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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
ORDER This is an appeal by the assessee against order dated 13.12.202, passed by National Faceless appeal Centre (NFAC), Delhi, pertaining to assessment year 2017-18.
I have heard Shri Rajiv Saxena, learned counsel for the assessee and Shri Om Prakash, Learned Departmental Representative.
The basic grievance of assessee is against ex parte disposal of its appeal by learned Commissioner (Appeals).
Briefly, the facts are, assessee is a resident company. For the assessment year under dispute, assessee filed its return of income on 10.11.2017, declaring income of Rs.64,710. Assessee’s case was selected for limited scrutiny to verify large share premium received during the year and applicability of Section 56(2)(viib) of the Income- Tax Act,1961.
In course of assessment proceedings, assessing officer while verifying facts on record, found that in the year under consideration, assessee had issued 150 shares at a premium of Rs.20 per share. Thus, assessee had received Rs.15,00,000 as share capital and Rs.30,00,000 as shares premium. Noticing the above, he issued a show cause notice to assessee to prove the genuineness of the share premium received and in case it fails to do so, the amount will be added to the income.
As observed by the assessing officer, in response to the show cause notice, neither assessee appeared nor filed any reply. Alleging non- compliance by assessee, assessing officer proceeded to complete the assessment under Section 144 of the Act to the best of his judgment.
While doing so, he added back the amount of Rs.45,00,000 as unexplained cash credit under Section 68 of the Act. Against the assessment order so passed, assessee preferred an appeal before the first appellate authority. However, National Faceless Appeal Centre, disposed of assessee’s appeal ex parte, upholding the addition made by the assessing officer.
Before us, learned counsel for the assessee submitted that neither the assessing officer nor learned Commissioner (Appeals) has extended reasonable opportunity of being heard to the assessee.
Therefore, he submitted, the order passed in gross violation of rules of natural justice should be set aside and matter be restored back to the assessing officer for providing reasonable opportunity of being heard to assessee.
Though, learned Departmental Representative supported the decision of assessing officer and the first appellate authority, however, he didn’t express any objection to assessee’s prayer for restoring the issue back to the assessing officer.
Having considered rival submissions, I find, both before the assessing officer and first appellate authority, the assessee went unrepresented.
Undisputedly, the addition in dispute is on account of unexplained cash credit under Section 68 of the Act. Since, the addition was made simply due to lack evidence furnished by assessee, I deem it appropriate to provide an opportunity to the assessee to furnish necessary and relevant documentary evidences before the departmental authorities to prove the genuineness of the share premium received during the year. Accordingly, I set aside the impugned order of the first appellate authority and restore the matter back to the assessing officer for de novo adjudication after providing due opportunity of being heard to assessee. Grounds are allowed for statistical purposes.
In the result, appeal is allowed for statistical purposes.