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Facts
The assessee, a registered society, filed its return and was selected for scrutiny. The AO estimated net profit at 5% due to non-submission of details. The CIT(A) dismissed the appeal as the assessee did not respond to notices.
Held
The Tribunal set aside the CIT(A) order and remitted the issue back for fresh adjudication, granting the assessee an opportunity to appear and submit documents, subject to payment of costs.
Key Issues
Whether the assessee was prevented by sufficient cause from appearing before the CIT(A) and presenting their case.
Sections Cited
143(2), 142(1), 43CB(1), 145(2), 12A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE
Before: SHRI LAXMI PRASAD SAHU & SHRI SOUNDARARAJAN K.
ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER
This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 09/05/2025 in respect of the A.Y. 2022-23.
The brief facts of the case are that the assessee is a registered society and filed their return of income on 30/12/2022. Thereafter the case was selected for scrutiny under CASS for three reasons. Notices u/s. 143(2) was issued to the assessee and notice u/s. 142(1) was also issued. The AO on the basis that the assessee had not submitted the details of the sundry creditors and the assessee had not submitted the requisite details and documents in order to estimate the net profit as per the ICDS-III,had 5% as profit and gains arising from the construction activity as per section 43CB(1) r.w.s. 145(2) of the Act, 1961. As against the said order, the assessee filed an appeal before the Ld.CIT(A). The assessee had not responded to the various notices issued by the Ld.CIT(A) and therefore the Ld.CIT(A) had decided the appeal based on the grounds raised by the assessee and finally dismissed the appeal.
As against the said order, the present appeal has been filed before this Tribunal.
At the time of hearing, the Ld.AR submitted that the assessee was not able to appear before the Ld.CIT(A) since the hearing notices were sent to the mail ID of the earlier counsel. The Ld.AR further submitted that the assessee therefore not filed any written statements and documents to substantiate their case before the Ld.CIT(A) and prayed an opportunity to appear before the Ld.CIT(A).
The Ld.DR relied on the orders of the lower authorities and prayed to dismiss the appeal.
We have heard the arguments of both sides and perused the materials available on record.
From the documents available before us, we came to understand that the assessee is a society originally got registration u/s. 12A and subsequently opted to pay tax under the regular provisions of the Act. The AO had estimated the net profit at 5% on the ground that the assessee had not furnished the details and documents in support of their claim which was disputed before the Ld.CIT(A). Unfortunately, the assessee had not filed any written submissions as well as any documents before the Ld.CIT(A) in support of the grounds raised by them and therefore the Ld.CIT(A) had decided the appeal based on the grounds and the assessment order and
It is the contention of the Ld.AR that the assessee was not able to appear before the Ld.CIT(A) since the hearing notices were sent to the earlier counsel’s email ID and therefore the assessee has no knowledge about the various hearing dates. From the said submissions, we find that that there is some force in the arguments made by the Ld.AR. In order to render substantial justice, we are inclined to grant one more opportunity to the assessee to appear before the Ld.CIT(A). Therefore we set aside the order of the Ld.CIT(A) and remit this issue to the file of the Ld.CIT(A) to decide the appeal on merits after hearing the assessee and also after considering the documents to be filed by the assessee before him. We are giving this concession on payment of Rs. 5,000/- to the Income Tax department by way of costs within a period of 2 weeks from the date of receipt of copy of this order and the receipt should be produced before the Ld.CIT(A) before commencing the appeal proceedings. With the above directions, we remit this issue to the file of the Ld.CIT(A) to decide the appeal on merits.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 12th November, 2025.