FINLINEA HEALTHWITS PRIVAE LIMITED Q,MUMBAI vs. DE CIT CIRLCE 6(1)(2), MUMBAI
Before: SHRI. OM PRAKASH KANT, AM & MS. KAVITHA RAJAGOPAL, JM Finlinea Healthwits Private Limited Unit No. 7, Ground Floor, 408, Hiren Light Industrial Premises, Mogul Lane, Mahim, Mumbai – 400016. Vs. Deputy Commissioner of Income Tax, Circle 6(1)(2) Aayakar Bhavan, M. K. Road, Mumbai – 400020. PAN/GIR No. AABCF7146A (Assessee) : (Respondent)
Per Kavitha Rajagopal, J M:
This appeal has been filed by the assessee, challenging the order of the learned
Commissioner of Income Tax (Appeals), Delhi (‘ld. CIT(A)’ for short), National
Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961
(‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2018-19. 2. As there was no representation on behalf of the assessee, we hereby proceed to dispose of this appeal by hearing the ld. DR and on perusal of the materials available on record.
3. It is observed that the present appeal has been filed with a delay of 111 days for which the assessee has filed an affidavit stating the reason for the said delay. Upon perusal of Finllinea Healthwits Pvt. Ltd.
the same and after hearing the ld. DR, we deem it fit to condone the delay on the ground that the assessee had ‘sufficient cause’ for the delay. Delay condoned.
4. The assessee has raised the following grounds of appeal:
“1. The Commissioner of Income-tax (Appeals) at the National Faceless Appeal
Centre (NFAC) (hereinafter referred to as the CIT(A)) erred in framing an ex parte order.
The appellants contend that on the facts and in the circumstances of the case and in law, the CIT(A) ought not to have framed the order ex parte.
The CIT(A) erred in not disposing of the following grounds of appeal on merits-
"The appellant prefers an appeal against an order u/s 143(3) dated
18.02.2021 passed by Learned Assessing Officer (National e-Assessment
Centre) on following grounds each of which are without prejudice to each other: -
The Ld. Assessing Officer erred in disallowing a) directors’ remuneration paid of Rs 72,90,000/- b) salaries and wages expenses to employees amounting to Rs 28,69,703/- c) Rent paid of Rs.25,74,950/- d) payments pertaining to Service Tax, custom duty and other rates/taxes/duty aggregating to Rs.6,75,113/- e) basically, all other business expenses to the extent of 90%; aggregating to Rs.63,91,904/-
The Ld. Assessing officer erred in initiating penalty proceedings on the above
The appellant carves leave to add, alter and/or delete above grounds of appeal at the time of its hearing."
The appellants contend that on the facts and in the circumstances of the case and in law, the CIT(A) ought to have considered the grounds of appeal and ought to have disposed of the same on merits.”
Finllinea Healthwits Pvt. Ltd.
Brief facts are that the assessee had filed its return of income dated 19.10.2018, declaring current year loss of Rs. 3,09,50,986/-. The assessee’s case was selected for scrutiny under CASS on the issue of low income in comparison to very high investment appearing in balance sheet and large business loss set off against the other heads of income. The ld. AO issued notice u/s. 143(2) and 142(1) which were duly issued and served upon the assessee. It is observed that the assessee has been non-compliant during the assessment proceeding and the ld. AO passed the assessment order u/s. 143(3) r.w.s. 143(3A) and 143(3B) of the Act, dated 18.02.2021, where the ld. AO determined the total income/loss at Rs. 41,49,320/- after making various additions/disallowance. 6. Aggrieved the assessee was in appeal before the first appellate authority, who vide an ex parte order dated 14.06.2024, dismissed the appeal filed by the assessee, thereby upholding the additions/disallowance made by the ld. AO. 7. The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A). 8. The ld. Departmental Representative for the revenue contended that the assessee has constantly been non-compliant before the lower authorities and has failed to furnish documentary evidences before the lower authorities and hence the ld. DR prayed that the order of the lower authorities be upheld. 9. We have heard the contentions of the ld. DR and perused the materials available on record. It is observed that the ld. AO has made various additions/disallowances pertaining to the salary paid to the directors amounting to Rs. 72,90,000/-, salary paid to employee amounting to Rs. 28,69,703/-, the rent paid amounting to Rs. 24,72,950/-, service tax, custom duty, STT and CTT amounting to Rs. 76,75,113/- along with Finllinea Healthwits Pvt. Ltd.
various other business expenditure amounting to Rs. 63,91,904/-. From the assessment order, it is evident that the assessee has failed to furnish the documentary evidence in support of its claim neither before the ld. AO nor before the ld. CIT(A). Pertinently, the ld. CIT(A) has not decided this issue on the merits of the case, for the reason that the assessee has been non-compliant throughout the appellate proceedings. In order to provide the assessee with one last opportunity to present its case before the ld. CIT(A), we deem it fit to remand this issue back to the file of ld. CIT(A) by adhering to the principles of natural justice and in the interest of justice dispensation. We direct the assessee to strictly comply with the proceedings before the ld. CIT(A) without any undue delay from its side and the ld. CIT(A) is also directed to decide this issue on the merits of the case based on the submission of the assessee and in accordance with law.
10. In the result, the appeal filed by the assessee is allowed for statistical purpose.
Order pronounced in the open court on 14.02.2025 (OM PRAKASH KANT)
JUDICIAL MEMBER
Mumbai; Dated: 14.02.2025
Karishma J. Pawar (Stenographer)
Copy of the Order forwarded to:
The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER,
(Dy./Asstt.