MANEESH CHOPRA,GAUTAM BUDH NAGAR vs. ITO WARD-2(2), NOIDA

When the matter was called for hearing, ld. counsel for the assessee adverted to the grounds of appeal and submitted that the Assessing Officer while completing the assessment under Section 143(3) of the Act made an addition of Rs.72,58,325/- by invoking the provisions of Section 56(2)(vii)(b) of the Act. In response thereto, the assessee filed an application for rectification under Section 154 of the Act on 19.01.2018. The Assessing Officer however rejected the rectification application filed by the assessee vide order dated 25.04.2018 under Section 154 of the Act. The assessee preferred appeal before the CIT(A) seeking rectification of apparent mistake but without any success. In this backdrop, the ld. counsel for the assessee pointed out that the Revenue is apparently in error in making additions by invoking Section 56(2)(vii)(b) which is not applicable to the case of the assessee at all, having regard to the underlying fact that this section is applicable when a person receives any immovable property without any consideration or for a lower consideration. Addressing further, ld. counsel for the assessee pointed out that the immovable property in consideration received by the assessee is, in fact, a gift from the mother of the assessee and thus falls under the proviso thereto whereby such alienation of property to the assessee from close relative are excluded from the sweep of deeming fiction under Section 56(2)(vii)(b). Ld. counsel thus submitted that both the lower authorities have committed apparent mistake in misappreciating the glaring factual aspects while applying the law. Ld. counsel thus urged that the lower authorities be directed suitably to rectify the error under Section 154 of the Act being perversed to the fact on record.

The Ld. DR for the Revenue on the other hand relied upon the order of the CIT(A) and submitted that the assessee has failed to capture the opportunity before the CIT(A) for addressing the grievance narrated before the Tribunal. He thus submitted that no interference with the order of the CIT(A) is called for, where such issue are inherently debatable and thus not amenable to the limited scope of Section 154 of the Act.

We have considered the rival submissions and perused the orders of the lower authorities. We find that the matter was proceeded by the CIT(A) unilaterally on the ground that the representative of the assessee did not attend the hearing on appointed date, i.e., 06.08.2018 and no power (vakalatnama) was enclosed. In effect, the matter has been proceeded ex-parte against the assessee. We are of the opinion that the appeal of the assessee by the CIT(A) ought not to have been disposed of hurriedly in a summary manner without taking cognizance of the stance of the assessee. The CIT(A), in our view, has failed to grant reasonable opportunity resulting in miscarriage of justice. On this ground alone, we are inclined to set aside the matter and restore it back to the file of the CIT(A) for de novo adjudication. Without expressing any view on merits, the Matter is thus set aside and restored to the first appellate authority. It shall be open for the assessee to take all plea, as may be considered expedient, to buttress its stance in support of its appeal before the CIT(A). Needless to say, the CIT(A) shall provide reasonable opportunity to the assessee and shall pass a speaking order. The assessee is also cautioned to ensure proper compliance of the proceedings before CIT(A) and shun any tactics of delay in the matter.

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