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Facts
The assessee filed a return of income, which was assessed at a higher amount. The CIT(A) dismissed the assessee's appeal, observing that certain amounts were fees, not reimbursement. Despite filing documents and seeking adjournment, the CIT(A) passed an order without considering them.
Held
The Tribunal found that the CIT(A) had passed the order without considering documents filed by the assessee. Therefore, the Tribunal remitted the issue back to the CIT(A) for a fresh consideration after providing the assessee a reasonable opportunity of being heard.
Key Issues
Whether the CIT(A) erred by dismissing the appeal without considering the additional evidence filed by the assessee, thereby denying a reasonable opportunity of being heard.
Sections Cited
143(3), 194H, 194C
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Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI. LAXMI PRASAD SAHU & SHRI. KESHAV DUBEY
Per Laxmi Prasad Sahu, Accountant Member :
This appeal is filed by the assessee against the Order of National Faceless Appeal Centre (NFAC) dated 28.02.2023 vide DIN and Order No.ITBA/NFAC/S/250/2022-23/1050211536(1).
Briefly stated, the facts of the case are that this is second round of proceedings before us. The assessee filed return of income declaring total income of Rs.8,90,270/-. Assessment was completed under section 143(3) of the Act determining total income at Rs.1,65,25,570/-. Assessee has filed affidavit stating the reasons for delay in filing the appeal. We find there is
Aggrieved by the Assessment Order, assessee filed appeal before the learned CIT(A). Before the learned CIT(A), assessee filed additional evidence which were not considered and learned CIT(A) dismissed the appeal of the assessee observing that the amount paid by the Bacardi India Pvt. Ltd., (BIPL) is fees but not reimbursement. The gross commission reported as per Form No.26AS under section 194H of the Act is Rs.26,46,859/- and TDS was deducted at Rs.2,64,686/- @ 10% which was offered as income in the ITR. There was TDS deducted under section 194C of Rs. 2,81,795/- of the Act. As per the submission of the assessee, reimbursement amount of Rs.1,40,89,703/- received from BIPL and TDS was deducted @ 2% of Rs.2,81,795/- which is not offered as income and TDS was claimed in the ITR of the assessee. during the second round of proceedings before the learned CIT(A). The Learned CIT(A) gave three opportunities to the assessee. In the notice dated 10.02.2023, date of compliance was 15.902.203. Assessee filed adjournment petition and requested time for compliance upto 02.03.2023. Assessee also filed documents on 15.02.2023 which is placed in Paper Book at Page 24. However, the learned CIT(A) passed the order on 28.02.2023 without taking cognizance of those documents which were filed by the assessee on 15.02.2023 and dismissed the appeal of the assessee.
Aggrieved from the above Order, assessee filed appeal before the Tribunal. The learned Counsel for the assessee reiterated the submissions made before the CIT(A) and submitted that the learned CIT(A) has passed Order without taking note of the documents submitted on 15.02.2023 and requested that the matter may be sent back to the CIT(A) for a fresh consideration.
Page 3 of 5 5. On the other hand, learned DR relied on the Order of the lower authorities and learned DR referred to CIT(A)’s Order dated 22.11.2019 in in para Nos.6.1 to 8 and he further submitted that during the course of assessment proceedings, assessee was unable to produce any reliable evidence as observed by AO. Assessee was given various opportunities but he could not submit the documents.
Considering the rival submissions, we noted that BIPL has deducted TDS under section 194C of the Act on amount paid of Rs.1,40,89,703/- which has not been included in the income statement of the assessee and TDS deducted of Rs.2,81,795/- under section 194C of the Act @ 2% has been claimed by the assessee in the income tax return as Tax payment on behalf of the assese. The AO has made addition of the same amount observing that the assessee was unable to prove the expenditure with reliable evidences. Assessee submitted that this is a reimbursement to the assessee towards expenditure incurred on behalf of BIPL which is evident from the debit notes issued by the assessee. Theassessee submitted that the reimbursement is not taxable. During the course of second round of appeal before the learned CIT(A), the learned CIT(A) provided various opportunities to the assessee as under:
Notice u/s Date of Issue Date of Compliance Remarks 250 21/12/2022 26/12/2022 No reply 250 09/01/2023 20/01/2023 No reply
15/02/2023 250 10/02/2023 No reply Page 4 of 5 7. During the course of hearing, the learned Counsel submitted that on the date of compliance on 15.02.2023, assessee has filed adjournment petition and sought time upto 02.03.2023 which is placed at Paper Book Page No.20. The learned Counsel also invited our attention to the fact that on 25.02.2023, assessee has filed documents which are placed at Paper Book Page Nos.22 to 24 and the Order has been passed by the learned CIT(A) on 28.02.2023. As per the submission of the assessee, the learned CIT(A) has not considered all these documents and upheld the Order of the AO.
Considering the facts of the case and in the interest of justice, we are remitting the issue to the file of learned CIT(A) for a fresh consideration for reconsidering the evidences filed by the assessee and decide the issue as per law after affording reasonable opportunity of being heard to the assessee and assessee is directed not to seek unnecessary adjournments for early disposal of the case.
In the result, appeal filed by the assessee is allowed for statistical purpose.
Pronounced in the court on the date mentioned on the caption page.