RIDDHI TEX FAB PVT LTD.,MUMBAI vs. ITO 13(3)(2), MUMBAI

This appeal by the assessee is directed against the order of Commissioner of Income Tax(Appeals)-21, Mumbai [in short 'the CIT(A)’] dated 26/11/2019 for the assessment year 2014-15.

Shri Vijay Mehta appearing on behalf of the assessee submitted that the solitary issue in the present appeal is disallowance of interest expenses of Rs.32,36,096/-. The ld. Authorized Representative for the assessee submitted that the CIT(A) without affording proper opportunity of hearing in a ex-parte proceedings has upheld the assessment order, wherein interest expenditure of Rs.32,36,096/- claimed by the assessee has been disallowed. The ld. Authorized Representative for the assessee submitted that if an opportunity is allowed to the assessee, the assessee would be able to explain its case. The assessee has prima-facie a good case in its favour.

Per Contra, Ms. Smita Verma representing the Department vehemently defended the impugned order and prayed for dismissing the appeal of assessee. The ld. Departmental Representative submitted that notice of hearing of the appeal was repeatedly issued by CIT(A) to the assessee On the dates fixed for hearing no authorized representative of the assessee ever appeared before the CIT(A) to defend the appeal. Hence, the CIT(A) was constrained to pass the order in an ex-parte proceedings.

We have heard the submissions made by rival sides and have examined the orders of authorities below. A perusal of the impugned order shows that on three occasions i.e. on 02/02/2018, 07/10/2019 and 06/11/2019 notice of hearing were issued to the assessee. None appeared in response to the said notice on the dates fixed for hearing. However, keeping in view the principles of natural justice and considering the facts of the case, we deem it appropriate to restore this appeal back to the file of CIT(A) for denovo adjudication after affording reasonable opportunity of hearing to the assessee, in accordance with law.

In the result, appeal by assessee is allowed for statistical purpose.