DCIT, ROHTAK vs. HARISH CHANDRA INDIA LTD., ROHTAK

This appeal filed by the Revenue is directed against the order dated 09.06.2017 passed by the Commissioner of Income Tax (Appeals)-Rohtak relating to Assessment Year 2013-14.

The relevant facts as culled from the material on records are as under :

Assessee is a company which is stated to be engaged in the business of Civil Contractor. Assessee filed its return of income

The case file reveals that in the past there was no appearance on behalf of the assessee. Even on the date of hearing there was no appearance on behalf of the assessee nor any application for adjournment has been filed by it though the notice of hearing was issued to the assessee. The case file also reveals that the notice of hearing was returned back by the Postal Authorities with the remark “unserved”. In view of these facts, we proceed to dispose of the appeal ex parte qua the assessee after considering the material on record and after hearing by the Learned DR.

Before us Learned DR pointed to the non compliance of the notice by the assessee as noted by the AO in Para 6 of the order, She therefore submitted that in the absence of any submission by the assessee, AO was left with no other alternative but to reject the books of accounts and thereafter estimate the income. She thereafter pointed to the order of CIT(A) and submitted that CIT(A) by a non-speaking order has deleted the additions made by AO. She therefore submitted that in such a situation the order of AO be upheld. In the alternate, she submitted that the matter be remanded back to the lower authorities with suitable directions.

We have heard the Learned DR and perused the material available on record. The perusal of the assessment order passed by the AO reveals that various notices were issued to the assessee calling for details but the same were not furnished by the assessee. AO therefore proceeded to pass the order u/s 144 of the Act and determined the total income by estimating the income based on the net profit rate of total revenue. The perusal of the CIT(A) order also reveals that CIT(A) has not passed a speaking order without deciding the issue on merits. Sub Section (6) of Section 250 of the I. T. Act mandates the CIT(A) to state the points in dispute and thereafter assign the reasons in support of his conclusion. We are of the view that by deciding the appeal without considering the issue of merits, Learned CIT(A) has failed to follow the mandate required in Sub Section (6) of Section 250 of the Act. Further it is also a settled principle of natural justice that sufficient opportunity of hearing should be offered to the parties and no party should be condemned unheard. In view of these facts, we set aside the order of CIT(A) dated 09.06.2017 and restore the issue back to the file of CIT(A) for re-adjudication of the issues. Needless to state that CIT(A) shall grant adequate opportunity of hearing to both the parties. In view of our decision to restore the issue to CIT(A), we are not adjudicating on merits the other grounds raised by Revenue. Thus the appeal of Revenue is allowed for statistical purposes.