REWARD IMPEX PVT. LTD.,NEW DELHI vs. ACIT, CIRCLE-19(1), NEW DELHI

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ITA 6800/DEL/2018Status: DisposedITAT Delhi22 April 2022AY 2014-155 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the issues to the Assessing Officer for de novo adjudication, granting the assessee a proper opportunity to be heard. This was done in the interest of fair play and justice due to the assessee's lack of proper compliance and claims of being kept in the dark.

What were the facts?

The assessee company failed to make proper compliance and provide requisite details before the Assessing Officer and Commissioner (Appeals) for assessment years 2011-12 and 2014-15. This led to significant additions and disallowances, including unexplained cash credits.

What were the issues?

Whether the assessee was denied a proper opportunity to present its case before the lower authorities due to non-compliance, warranting a remand for de novo adjudication.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

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

Before: SHRI G.S. PANNU & SHRI SAKTIJIT DEY

For Appellant: Shri Goverdhan Das, Assessee in person
For Respondent: Shri Atiq Ahmed, Sr. DR
Hearing: 01.04.2022Pronounced: 22.04.2022

ORDER PER SAKTIJIT DEY, JUDICIAL MEMBER: Captioned appeals have been filed by the assessee against two separate orders of learned Commissioner of Income-Tax (Appeals), New Delhi for the assessment years 2011-12 and 2014-15.

2.

At the time of hearing, Shri Goverdhan Das, the director of the assessee company appeared and submitted that due to advanced age, he was unable to keep himself acquainted with the affairs of the company. He submitted, the persons who were in charge, including some family members, neglected the tax proceedings conducted before the departmental authorities. He submitted, no timely and proper representation was made before the departmental authorities in course of these proceedings and he was kept in dark. He submitted, as a result, not only the business of the company has suffered but he himself is in a precarious financial condition which does not even permit him to engage a professional to appear before the Tribunal. Thus, he submitted, proper opportunity may be granted to him to contest the disallowances/additions made by the Assessing Officer, which are subject matter of dispute in these appeals.

3.

Learned Departmental Representative submitted, the issues arising in appeals may be restored back to the Assessing Officer for de novo adjudication so that the assessee gets proper opportunity of hearing.

4.

We have considered rival submissions and perused the material available on record. On examining the record, we have found that in assessment year 2011-12 in course of proceedings before the Assessing Officer, proper compliance was not made to the queries raised by the Assessing Officer with regard to the cash deposits of Rs.1,03,27,250 in the bank account. As a result, he added back the amount by treating it as unexplained cash credit under Section 68 of the Income-Tax Act, 1961. Similarly, in absence of proper compliance, number of other additions/disallowances were made, including, some disallowance on purely ad hoc basis, which enhanced the income to Rs.8,47,59,900 as against Rs.2,58,940 declared by the assessee. Pertinently, there was no improvement in the status of compliance even before learned Commissioner (Appeals), as, it is very much clear from the impugned order of the learned Commissioner (Appeals) that in absence of requisite details and proper explanation, the additions made by the Assessing Officer were confirmed.

5. In so far assessment year 2014-15 is concerned, as against loss of Rs.1,71,95,930 declared by the assessee a positive income of Rs.82,25,512 was determined by the Assessing Officer. In this assessment year also, Assessing Officer made couple of additions amounting to Rs.85,88,758 and Rs.1,68,34,684 in absence of proper compliance by the assessee. The position was worse before learned Commissioner (Appeals), as, the appeal was decided ex parte due to non-compliance with the hearing notices. Thus, the aforesaid facts, to certain extent, make the contention of the assessee believable that proper steps were not taken before the departmental authorities in course of tax proceedings. Since, on perusal of record, we are convinced that the additions which are subject matter of dispute in the present appeals were made purely due to lack of proper compliance by the assessee and considering the submissions of the representative appearing for the assessee that he was kept in dark about the tax proceedings, in the interest of fair play and justice, we deem it appropriate to restore the issues arising in these appeals to the file of the Assessing Officer for de novo adjudication after due and proper opportunity of being heard to the assessee. The assessee is directed to comply with the notices/queries to be issued by the Assessing Officer and cooperate in finalizing the proceedings. Grounds are allowed for statistical purposes.

5.

In the result, appeals are allowed for statistical purposes.

Order pronounced in the open court on 22nd April, 2022.

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