JOGINDER SINGH GULZAR SINGH KHEHRA,NANDED vs. ITO WARD 1, NANDED, NANDED

Before the Ld.CIT(A), there was non-compliance of notice(s) of hearing and the Ld.CIT(A)/NFAC dismissed the appeal of the assessee for non-prosecution.

Aggrieved, the assessee is in appeal before the Ld.CIT(A)/NFAC, raising the following grounds of appeal:

Dissatisfied, the assessee is in appeal before the Tribunal.

The Ld.AR submitted that apart from challenging the above addition(s) made by the Ld.AO, which have been confirmed by the Ld.CIT(A)/NFAC, the assessee has also raised a legal ground before the Tribunal for the first time challenging the issue of notice u/s. 148 of the Act being barred by limitation. Relying on the decision of the Hon‟ble [229 ITR 383] (SC), we hereby admit the additional ground as the same goes to the root of the matter and no new facts are involved, but emanating from the existing records.

The Ld.AR further submitted that non-compliance to the notice(s) issued by the Ld.CIT(A)/NFAC was not intentional, but resulted due to certain unavoidable circumstances faced by the assessee at the relevant time. He submitted that the assessee is keen to make complete and total compliance as so required before the Ld.CIT(A)/NFAC and the present situation is simply a fall-out of a communication gap. He submitted that the assessee has a strong case on merits and, therefore, humbly prayed that in the interest of justice, an opportunity may be granted to the assessee to substantiate his case before the Ld.CIT(A)/NFAC by filing the requisite explanation/details/documents.

The Ld.DR supported the order of the Ld.CIT(A)/NFAC and submitted that since the assessee failed to make compliance in spite of several opportunities granted, the Ld.CIT(A)/NFAC was completely justified in dismissing the appeal of the assessee.

We have heard the Ld. representatives of the parties and perused the material available on record. Admittedly, there was non-compliance by the assessee to the notice(s) issued by the Ld.AO as well as by the Ld.CIT(A)/NFAC, which constrained them to pass an ex-parte order qua the assessee. We find that the Ld.AO has completed the assessment u/s. 147 r.w.s. 144 r.w.s. 144B of the Act thereby making addition of – (i) Rs. 9,05,320/- under the head “income from business” and (ii) Rs. 2,27,85,736/- treating the same as unexplained investments u/s. 69 of the Act and (iii) interest income of Rs. 59,082/- under the head “income from other sources”. We observe that the Ld.CIT(A)/NFAC has passed the impugned order without himself going into the merits of the case and endorsing the findings of the Ld.AO due to lack of compliance or any explanation offered by the assessee despite several opportunities granted during the appellate proceedings. Before us, the Ld.Counsel for the assessee has submitted that the non-compliance to the notices of hearing before the Ld.CIT(A)/NFAC was not intentional and that the assessee is now in a position to substantiate his claim before the Ld.CIT(A)/NFAC by filing the requisite explanation/details/documents. Perusal of the order of the Ld.CIT(A)/NFAC reveals that he has applied the decision in the case of B.N. Bhattacharjee and Another [118 ITR 461] and various other decisions and dismissed the case of the assessee for non-prosecution. No doubt, the Ld.CIT(A)/NFAC may decide the appeal where the assessee does not prosecute his appeal in spite of several opportunities, nonetheless, he has to adhere to legislative mandate enshrined in sub-section (6) of section 250 of the Act, which requires him to state the points for determination, the 6 decision thereon and the reasons for the decision. Thus, in our view, his order is in violation of the provisions of section 250(6) of the Act.

On the facts and in the circumstances of the case enumerated above, we are of the opinion that in the interest of justice, the matter deserves to be sent back to the file of the Ld.CIT(A)/NFAC for adjudicating the assessee‟s appeal afresh, on merits as well as legal issues/ground raised by the assessee, as per fact and law, after allowing reasonable opportunity of hearing to the assessee. Needless to say, the assessee shall provide the requisite support in terms of submitting the relevant documents/evidence as may be required/called upon on the appointed date, without seeking any adjournment, unless required for a sufficient cause failing which the Ld.CIT(A)/NFAC shall be at liberty to pass the appropriate order in accordance with law. We hold and direct accordingly. The grounds of appeal raised by the assessee are accordingly allowed for statistical purposes.

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes.

The concerned Pr.CIT, Pune

DR, ITAT, „A‟ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, ////