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Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD
Before: SHRI PRAMOD KUMAR&
O R D E R
PER Ms. MADHUMITA ROY - JM:
The instant appeal filed by the Assessee is directed against the ex-parte order dated 24.11.2016 passed by the Commissioner of Income Tax (Appeals) – 4, Ahmedabad arising out of the order dated 26.03.2014 passed by the Income Tax Officer, Ward – 3(2), Ahmedabad under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred as to ‘the Act’) for Assessment Year 2009-10.
The return of income filed by the assessee dated 20.09.2009 declaring total income at Nil assessment was finalized u/s 143(3) of the Act on Dhanesh P Soni vs. ITO Assessment Year 2009-10 - 2 - 30.11.2011, determining total income at Rs.74,02,410/- by making following additions: Disallowance of Interest u/s 36(1)(iii) 1,71,802/- Addition u/s 68 11,00,000/- Short Term Capital Gain 62,34,253/-
Penalty proceeding was also initiated in respect of Serial No. 2 & 3, which was culminating into levy of penalty of Rs.22,66,283/- u/s 271(1)(c) of the Act by the Income Tax Officer, Ward-3(2) on 26.03.2014. In appeal, notices were issued u/s 250 of the Act. It is evident from the record that the appellant filed adjournment application on several times but most of the time, the assessee was represented by the authorized representative and adjournment applications were moved. The Learned CIT(A) also kind enough to grant adjournment. However, the tax consultant of the assessee could not seek adjournment on 23.11.2016 since his real nephew was getting married on 23.11.2016 and he being eldest one in his family and his real brother died at young age, he could not attend the office due to such marriage ceremony in those days. The matter remained unattended and hence ex-parte order was passed as submitted by the Learned Counsel appearing for the assessee before us. It was further submitted by the Learned Counsel that the observation made by the Learned CIT(A) that the assessee is neither Co-operative nor interested in disposal of the appeal is not correct. The main reason for seeking adjournment were the pendency of quantum appeal before the Tribunal when the normal practice is to keep the penalty in abeyance and keep the appeal pending till such disposal of the quantum appeal. The assessee was otherwise all along being vigilant. It also appears from the order under challenge that the Learned CIT(A) without making any personal observation reiterated the stand
Dhanesh P Soni vs. ITO Assessment Year 2009-10 - 3 - taken by the Learned AR. No reason has been assigned in deciding the points in dispute and in supported of his conclusion thereto. While concurring with the view taken by the Learned AO the Learned CIT(A) has neither raised any specific point on the basis of the details available before him which is required to be followed as contemplated section 5 of sub section 250 of the Act as argued by the Learned AR at the time of hearing. In that view of the matter since the exercise of power by the Learned CIT(A) is not in coherence mandate with the under section 250(6) of the Act, he prays for set aside the issue to the Learned CIT(A) for fresh hearing of the appeal. In support of his argument, he further relied upon the order passed by the Co-ordinate Bench in 147 and 148/Ahd/2017 copy whereof was also submitted before us. However, the Learned DR failed to controvert such contention made by the Learned AR in support of his case.
Having heard the Learned Counsel appearing for the parties having regard the facts and circumstances of the case and upon perusal of the order passed by the Co-ordinate Bench in 147 & 148/Ahd/2017 in identical issue. We find substance in the argument advanced by the Learned AR. The relevant portion of the judgment passed by the Co-ordinate Bench is as follows: “4. We have duly considered rival contentions and gone through the record carefully. We find that in para-2 of the impugned orders, the ld.CIT(A) has noticed the details of hearing and how the assessee has complied with the directions. No doubt the hearings in all these appeals were fixed on seven occasions. Out of seven occasions, the assessee appeared on six occasions, but hearing was adjourned. On the seventh occasion, no one could appear before the ld.CIT(A).
Dhanesh P Soni vs. ITO Assessment Year 2009-10 - 4 - 5. The ld.CIT(A) has concluded the hearing and dismissed the appeals by way of separate orders on 15.11.2016. Sub-section (6) of section 250 of the Income Tax Act, 1961 contemplates that the ld.CIT(A) would states the points in dispute and thereafter assign reasons in support of conclusions. On perusal of the impugned orders would indicate that the ld.CIT(A) has simply concurred with the AO without formulating specific points and taking note of details available before the ld.CIT(A). In a way, the appeals were dismissed in summary manner. This exercise of power at the end of the ld.CIT(A) is not in coherence with the mandate of section 250(6) of the Act, therefore, we set aside all these orders and restore all the issues in these three assessment years to the file of the ld.CIT(A) for deciding them on merit. We further direct the assessee to cooperate with the ld.CIT(A) and refrain himself from seeking unnecessary adjournments.
In the result, appeals of the assessee are allowed for statistical purpose.”
Relying on the ratio laid down by the Learned Bench, we are of the opinion that the assessee argued to have been given another opportunity of hearing. Since the order passed by the Learned CIT(A) suffers from the inherent lacuna by not following the mandate prescribed under section 6 to sub section 250 of the Act as discussed above the order is liable to be quashed. In that view of the matter, we find it fit and proper to set aside the issue to the file of the Learned CIT(A) to adjudicate the same afresh upon giving a reasonable opportunity of hearing to the assessee and upon taking into consideration the evidences placed on record and the evidences which the assessee may choose to file at the time of hearing of the appeal. We make it clear that while passing the order the Learned CIT(A) will pass cogent reason in support of his conclusion in accordance with law. However, we also make it clear that the assessee would also render assistance and/or co-operate with the Learned
Dhanesh P Soni vs. ITO Assessment Year 2009-10 - 5 - CIT(A) without asking for any unnecessary adjournment. Hence, assessee’s appeal is allowed for statistical purposes.