YASH ORGANIZERS PVT. LTD.,AHMEDABAD vs. THE DY.CIT, CIRCLE-8,, AHMEDABAD

Assessee has taken three grounds of which contained sub- grounds. However, its only grievance is that the ld.CIT(A) has erred in confirming addition of Rs.74,46,656/- by way of an ex parte order.

Brief facts of the case are that the assessee company at the relevant time was engaged in the business of real estate and construction activities. It has filed its return of income on 7.7.2012 declaring total income at Rs.2,97,13,160/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) was issued and served upon the assessee. On perusal of accounts it revealed to the AO that total sale value of seven shops have been recognised in the profit & loss account at Rs.7,70,86,500/-. However, the assessee has credited sale of Rs.6,16,69,200/- only in the accounts for computing income. The AO sought explanation of the assessee as to why it has not recognized the total value of the shops in the sale value. The assessee contended that actual work of construction of building completed to the extent of 89.66%. Since a number of formalities are required to be fulfilled, therefore, it has to recognize the sale value to the extent of 80%. This explanation of the assessee was rejected by the AO. He observed that the assessee should have recognized sale consideration to the extent of 89.66% because to this extent actual work has been completed. He worked out the difference of 74,46,556/- and made addition.

Dissatisfied with this addition, the assessee carried the matter in appeal before the ld.CIT(A). The ld.CIT(A) has observed that in response to the notice of hearing, Shri S.N. Diveta, Advocate has filed written submissions under his signature dated 8.11.2014. The assessee sought adjournment vide application dated 2.12.2014. However, the ld.CIT(A) has decided the appeal

We have duly considered rival submissions and gone through the record carefully. Sub-section 6 of Section 250 contemplates that ld.CIT(A) would determine the points in dispute and thereafter record reasoning in support of his conclusion on these points. A perusal of the impugned order would reveal that it is running into 5 pages. The ld.CIT(A) has reproduced grounds of appeal on page no.1, and thereafter reproduced alleged submissions made by the assessee in paragraph-3 on page no.2. From latter part of page no.2 upto page no.5, the ld.CIT(A) has reproduced the finding of the AO. The ld.CIT(A) has concurred with the findings of the AO in para-7. To our mind impugned order is not in coherence with the requirement of sub-section (6) of section 250. The ld.CIT(A) ought to have given one more opportunity to the assessee for advancing arguments and submitting other material which has been submitted before the AO. Thereafter by recording reasons appeal ought to have been decided. Simplicitor concurrence with the finding of the AO is not proper method for adjudicating the appeal. Therefore, we set

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