BIJAYNAGR KRAYA VIKRYA SAHAKARI SAMITI LTD.,JAIPUR vs. INCOME TAX OFFICER, BEAWAR

It was contended by the ld.AR of the assessee that on different dates as and when the matter was fixed, the A/R of the assessee did sent request for adjournment through e-mails. Our attention was invited to the adjournment letters and the proof of sending the same on mail (PB 19-24). However, the ld. CIT(A) has not at all mentioned this fact. It was only when some genuine inability of the A/R, adjournment was sought i.e. on some occasions, the A/R was to appear before the Hon’ble Rajasthan High Court. On some occasions, the details and clarifications were not forthcoming from the appellant/assessee society. Thereafter, the assessee had filed a miscellaneous application in MA No. 118/JP/2018 against the order u/s. 263 in the base year 2012-13, however, the order of the Hon’ble ITAT in the MA was pending when the matters were being listed before the ld. CIT(A), Ajmer. Such order could be received by the assessee only on 05.02.2018. Therefore, the A/R was also waiting for the order of the MA, which was having a bearing over the ITAT order passed i.r.t s. 263 and was going to have the direct bearing over the issues involved in the subjected years. Thus, it was not a case of complete non- compliance on the part of the assessee.

The ld. AR further contended that the ld. CIT(A) did not send any notice giving final opportunity nor any other communication was made to the assessee and of the fact of non-compliance. The ld. AR also no real and adequate opportunity of being heard was ever provided by the ld.CIT(A). Therefore, deciding the appeal ex-parte, this way, was a violation of the principles of natural justice.

On the other hand, the ld. DR supported the orders passed by the lower authorities.

I have considered the rival contentions and carefully gone through the orders of the authorities below and found that non-appearance of the ld. AR of the assessee before the ld. CIT(A) was on reasonable ground.

After going through the said order of the Tribunal ( in assessee’s own case), I found that the Hon’ble ITAT has now directed the AO to consider the claim of the assessee on merits as regards allowability thereof u/s. 40A(9), sec. 37(1), diversion of income by overriding title.

I also found that recently the AO i.e ITO, Ward-1, Beawar, in the- re-assessment order passed u/s. 143(3) r/w/s 254 & 263 of the Act, pursuant to the direction of the Hon’ble ITAT, has again repeated the disallowances i.e addition/disallowance made on account of transfer of the General Reserve, amounts transferred to the Education Reserves and the provision of gratuity in A.Y 2012-13 but without applying his mind on the specific directions given by this Hon’ble Bench to the AO in its order dated 05.02.2018.

In all fairness, I hereby set aside the impugned ex-party orders of the ld. CIT(A) and the matter is restored back to him for deciding/considering the said decision matter afresh and the claim of diversion of income by overriding title. We direct accordingly.

Since the facts and circumstances in all the other years under consideration are same, therefore, these are also restored back to the file of the ld.CIT(A) with the same direction. The assessee is also directed to appear before the ld. CIT(A) within a period of 60 days from the receipt of this tribunal order. We direct accordingly.

In the result, all the appeals of assessee are allowed for statistical purpose.