ALCHEMIST HOSPITALS LIMITED,CHANDIGARH vs. ACIT, CC 20, NEW DELHI

When the matter was called for hearing, the ld. counsel for the assessee at the outset referred to paragraph 4 of the first appellate order and pointed out that the counsel of the assessee, Shri Mohit Gupta, CA sought adjournment in pursuance of the notice dated 27.03.2019 issued by the CIT(A). Similarly, adjournment letters were given on the subsequent dates and accepted by the CIT(A). However, the ld. counsel for the assessee became disinterested and omitted to comply with the notice of hearing without the knowledge of the assessee. The intervening period was also a Covid-19 period resulting in disarray and non compliance. It was thus submitted that a pedantic view be shunned and a benign view be taken. It was next submitted that the substantive issue involved in the present case is covered by the decision of the Hon’ble Delhi High Court in the case of CIT vs. Kabul Chawla as reported in 380 ITR 573 (Del). As the assessment was framed under Section 153A without any incriminating material in a concluded assessment, under the circumstances, there was no reason for the assessee to not attend the proceedings before the CIT(A) at its own peril. It was submitted that a new counsel has since been appointed to comply with the proceedings. Under the circumstances, it was contended that benign view be taken in the matter to prevent the miscarriage of justice and ex-parte order of the CIT(A) be cancelled and grievance raised in its appeal may be restored to the file of the CIT(A) for decision on merits in accordance with law.

Ld. DR for the Revenue relied upon the order of the CIT(A).

We have dispassionately considered the rival submissions and perused the material available on record. It is an admitted position that initially on some occasions, the counsel for the assessee applied for adjournment, in response to the notice of hearing before the ld. CIT(A). However, thereafter no compliance was made nor any adjournment was sought. The CIT(A) has accordingly proceeded with the appeal of the assessee ex-parte and confirmed the action of the Assessing Officer. At this stage, it may be pertinent to observe that a fiery pandemic beyond human comprehension had engulfed the nation and a catastrophic situation was in vogue due to outbreak of Covid-19. It is common knowledge that consequent nationwide lockdown has resulted in serious disruption in the business cycle of the tax payers. The assessee has cited mitigating reasons for non attendance and has also tried to address on factual matrix. Under the circumstances, we find substantial force in the plea of the assessee in setting aside the order of the CIT(A) and restore the issue involved to the file of the CIT(A) for adjudication on merits in accordance with law after giving proper opportunity to the assessee to prevent miscarriage of natural justice. We order accordingly.

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