EMERALD ALCHYMICUS PRIVATE LIMITED ,MUMBAI vs. DCIT, CIRCLE 15(1)(1), MUMBAI
IN THE INCOME-TAX APPELLATE TRIBUNAL “E” BENCH,
MUMBAI
BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER
&
SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER
ITA 1422/MUM/2025
(A.Y. 2017-18)
ITA 1423/MUM/2025
(A.Y. 2017-18)
ITA 1424/MUM/2025
(A.Y. 2016-17)
Emerald Alchymicus Private
Limited, C/o Vaish Associates,
106, Peninsula Centre, Dr. S.S.
Rao
Road,
Parel–400012,
Mumbai, Maharashtra v/s.
बनाम
Deputy
Commissioner of Income Tax, Central Circle –
15(1)(1),
Aayakar
Bhavan,
Mumbai, Maharashtra
स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AABCE1297M
Appellant/अपीलार्थी
..
Respondent/प्रतिवादी
Date of Hearing
24.04.2025
Date of Pronouncement
28.04.2025
आदेश / O R D E R
PER PRABHASH SHANKAR [A.M.] :-
The above captioned appeals have been preferred by the assessee company against the orders of even date as passed by the Learned
Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre,
Delhi [hereinafter referred to as “CIT(A)”] pertaining to assessment orders passed under the Income-tax Act, 1961 [hereinafter referred to as “Act”] for the Assessment Years [A.Y.] 2016-17 and 2017-18. Since the appeals were Appellant by :
Sri Pankaj Soni, Adv a/w Ms. S. Shanmugam,ARs
Respondent by :
Sri Biswanath Das, (CIT DR)
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
heard together, they are being taken up together for adjudication vide this composite order for the sake of brevity.
2. The grounds of above captioned appeals are as under:-
ITA 1422/MUM/2025 (A.Y. 2017-18)
1 .
2 .
That the ex-parte order dated 18.12.2024, passed by the CIT(A) is perverse, arbitrary and bad in law and without providing sufficient opportunity of being heard to the appellant. 2. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte, without examining that the reopening of the assessment proceeding in case of the appellant under section 147, issuing notice under section 148, and passing order under section 148A(d) of the Act is invalid, without juri iction, perverse, arbitrary and bad in law. 3. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the addition of Rs. 10,05,00,000/- made by the assessing officer rejecting the writing off stock by the appellant due to the expiry of the useful life of the product and turned out to be obsolete as on 31.03.2017. 4. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the addition of assessing officer of Rs. 2,00,00,000/- as alleged unexplained cash credit under section 68 of the Act for depositing cash during demonetisation period without application of mind (vide assessment order dated 24.12.2019). The said amount is treated by the assessing officer as ‘unexplained money’ under section 69A while determining assessed income vide assessment order dated 24.12.2019. 5. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the action of the assessing officer in not allowing set off of losses with alleged income of Rs. 2,00,00,000/- assessed under section 68/69A of the Act. 6. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the levy of penalty under section 270A of the Act for alleged under-reporting of income, in consequence of misreporting the particulars of income. ITA 1423/MUM/2025 (A.Y. 2017-18)
That the ex-parte order dated 18.12.2024, passed by the CIT(A) is perverse, arbitrary and bad in law and without providing sufficient opportunity of being heard to the appellant.
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the addition of assessing officer of Rs. 2,00,00,000/- as alleged unexplained cash credit under section 68 of the Act for depositing cash during demonetisation period without application of mind. The said amount is treated by the assessing officer as ‘unexplained money’ under section 69A while determining assessed income. 3. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the action of the assessing officer in not allowing set off of losses with alleged income of Rs. 2,00,00,000/- assessed under section 68/69A of the Act. 4. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the disallowance of Rs. 10,000/- made by the assessing officer under section 14A. 5. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the levy of penalty under section 270A of the Act for alleged under-reporting of income.
ITA 1424/MUM/2025 (A.Y. 2016-17)
1. That the ex-parte order dated 18.12.2024, passed by the CIT(A) is perverse, arbitrary and bad in law and without providing sufficient opportunity of being heard to the appellant.
2. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte, without examining that the reopening of the assessment proceeding in case of the appellant under section 147, issuing notice under section 148, and passing order under section 148A(d) of the Act is invalid, without juri iction, perverse, arbitrary and bad in law.
3. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the addition of Rs. 28,29,00,000/- (Rs. 18.03 Crore, for LC received from bank Rs. 10 Crore for loan received from Vivank
Enterprises Pvt. Ltd) made by the assessing officer as alleged unexplained cash credit under section 68 of the Act.
4. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the addition of Rs. 5,00,00,000/- made by the assessing officer as alleged unexplained expenditure under section 69C of the Act for advance paid to Kalinga Inceptum Pvt. Ltd. to carry out research and developing products.
5. That the CIT(A) erred in law and fact in dismissing the appeal of the appellant ex-parte and confirming the levy of penalty under section 271(1)(c) of the Act for alleged concealment of income and 271(1)(b) for non-compliance of notice issued under section 142(1) of the Act.
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
It may be stated here that two appeals relate to AY 2017-18. While ITA No.1422/Mum/2025 pertains to the assessment order passed u/s 147/144 r.w 144B, ITA No.1423/Mum/2025 relates to the assessment order passed u/s 143(3) of the Act. ITA No. 1424/Mum/2025 pertaining to AY 2016-17 relates to assessment order u/s 147/144 r.w section 144B of the Act. Further, all these appeals have been dismissed in limine by the ld.CIT(A) on account of non- prosecution by the assessee during appellate proceedings despite several notices of hearing issued by him. No written submissions were made either. Accordingly, he concluded that no useful purpose would be served by keeping the appeal pending and therefore, the appeals were decided on the basis of documents available on record. He finally dismissed the appeals by holding that the appeals were not maintainable. 4. We have carefully considered all the relevant facts of the case. It is evident from the contents of the impugned orders that despite several opportunities of hearing allowed, there was no compliance by the assessee before the AO. It is observed that the ld.CIT(A) dismissed the appeals solely on the ground of non-appearance. He did not adjudicate the grounds of appeal and the issues involved, though the provisions of section 250(4) of the Act enjoin upon him to decide the appeals on merit
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
despite non-compliance by the assessee. However, it is equally true that it is the fundamental duty of the assessee to diligently pursue the proceedings and comply with the notices and proceedings initiated by the Revenue authorities. The failure of the assessee to make any response before the authority concerned reflects gross negligence and an indifference. The principles of natural justice operate both ways, while the Revenue authorities are required to provide a reasonable opportunity of being heard, the taxpayer is equally obligated to co- operate with the authorities and utilize the opportunities extended. In the present case, despite receiving adequate opportunities, the assessee displayed a casual approach and indifference
4.1 In light of the non-compliant attitude of the assessee, levy of cost needs to be evaluated in this case as cost serves as a necessary deterrent to ensure that taxpayers act with due diligence in pursuing their tax cases and respecting the timelines and processes laid down under the law. It also emphasizes the principle that while justice must be ensured, the system cannot cater to negligence on the part of the assessee. Considering assessee’s non-compliant and non-cooperative attitude and lack of diligence in pursuing the appeals, we impose a cost of Rs.1,100/- on it for each of the above appeals. The cost (Rs 3,300/- in aggregate)shall be deposited to the credit of the Income Tax Department
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
within 15 days of the receipt of this order and proof of payment shall be submitted before the ld.CIT(A).
5. Considering all the relevant facts of the case, we are of the view that following the principles of natural justice, it would be fair and judicious to allow an opportunity of hearing to the assessee to explain the matter before authorities below in the interests of justice. During the hearing, the Bench proposed for restoration of above appeals to the ld.CIT(A) for a de novo consideration. The Revenue did not oppose this plea. Thus, in the interest of justice, we deem it appropriate to send back the case for fresh consideration. The ld. CIT(A) shall give proper and adequate opportunity of being heard to the assessee in accordance with principles of natural justice in the set aside remand proceedings for de novo adjudication of the entire matter. Needless to state, the assessee will comply with notices and make available any details as deemed fit and sought by the appellate authority.
6. Before parting with the subject, we would like to make it clear that setting aside the appeals for de novo consideration by us, should not be construed in any manner affecting the merits of the cases for which the ld.AO is duly empowered to take an independent decision in accordance with the provisions of law.
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ITA No. 1422, 1423,1424/Mum/2025
A.Y. 2016-17, 2017-18
Emerald Alchymicus Pvt. Ltd.
In the result, above captioned appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on 28/04/2025. NARENDER KUMAR CHOUDHRY PRABHASH SHANKAR (न्याययक सदस्य/JUDICIAL MEMBER) (लेखाकार सदस्य/ACCOUNTANT MEMBER)
Place: म ुंबई/Mumbai
ददनाुंक /Date 28.04.2025
Lubhna Shaikh / Steno
आदेश की प्रयियलयि अग्रेयिि/Copy of the Order forwarded to :
1. अपीलार्थी / The Appellant
2. प्रत्यर्थी / The Respondent.
3. आयकर आयुक्त / CIT
4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT,
Mumbai
5. गार्ड फाईल / Guard file.
सत्यावपि प्रवि ////
आदेशानुसार/ BY ORDER,
उि/सहायक िंजीकार (Dy./Asstt.