KUTCH LEAFIN LIMITED,DELHI vs. THE ITO, WARD-2(1)(1), AHMEDABAD

The Ld. CIT(A) has erred in not adjudicating the appeal on merits despite substantial grounds being raised. The dismissal merely on technical grounds is unjust, improper and against the settled principles of law

The Ld. AO has erred in reopening the assessment u/s 147 of the Act merely on the basis of information from the Investigation Wing, without Asst. Year : 2012-13 - 2– any independent application of mind, verification, OR tangible material, rendering the reopening bad in law.

The Ld. AO has erred in making an arbitrary and ad hoc addition of 1% of total bank credits amounting to Rs.61,59,600/- without invoking any specific provision of the Act, without rejecting the books of account, and without providing any rationale for such addition.

The Ld. AO has erred in making the impugned addition without granting proper and effective opportunity of being heard, without furnishing reasons recorded for reopening, and without issuing any show cause notice before making the addition, thereby violating natural justice.

The Ld. AO has erred in initiating penalty proceedings u/s 271(1)(c) mechanically and without recording satisfaction, though there was no concealment of income OR furnishing of inaccurate particulars by the Appellant.

The Ld. AO has erred in law and on facts in initiated interest proceedings u/s 234A, 234B & 234C despite the fact that the amount added to the total income of the assessee is bad in law and proposing on interest on same is also and same need to be deleted.

The assessee request your good selves that since he was not given proper opportunity of being heard, submission of additional evidence at the time of appeal proceedings' is requested.”

From the record, we find that the assessee did not comply with the notices issued by the Ld. CIT(A) on eight occasions. The Assessing Officer made an addition of Rs.61,59,600/- being 1% of the total net credits found in the bank accounts amounting to Rs.61,59,60,057/-.

The Ld. DR submitted before us that the assessee has been categorized as NBFC under ‘High Risk Financial Institutions’ (by BIU-IND) on account of non- compliance with the PMLA and PML Rules, i.e. non-registration of Principal Officer (PO), which is found at Sr. No. 4520 as ‘MANDHANA FEAFIN LIMITED’. The Ld. DR also submitted that the assessee has been registered at various addresses; however, we do not consider an impediment to adjudicating the case. Asst. Year : 2012-13 - 3– 5. The Ld. CIT(A) has passed an ex-parte order owing to non-compliance by the assessee. We, therefore, in the interest of justice, we remand the matter to the file of the Ld. CIT(A) for de-novo adjudication.

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

अपीलाथ / The Appellant 2.  थ / The Respondent. 3. संबंिधत आयकर आयु / Concerned CIT 4. आयकर आयु(अपील) / The CIT(A)- 5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड फाईल / Guard file.