A.RAGHURAM,CHENNAI vs. ACIT CENTRAL CIRCLE 1 (2), CHENNAI

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ITA 639/CHNY/2018Status: DisposedITAT Chennai27 April 2022AY 2014-154 pages
AI SummaryRemanded

What did the Tribunal hold?

The tribunal held that the PCIT's revision order was passed without affording the assessee a proper opportunity to be heard, as the show-cause notice was not demonstrably served on the assessee. Therefore, the order was set aside.

What were the facts?

The assessee's appeal was filed with a 2-day delay, which was condoned by the tribunal. The primary issue was the validity of a revision order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263.

What were the issues?

Whether the revision order passed by the PCIT under Section 263 is valid when the assessee was not properly served with the show-cause notice and thus denied an opportunity to be heard.

Which sections of the Income-tax Act were involved?

Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘D’ BENCH, CHENNAI

Before: SHRI MAHAVIR SINGHAND SHRI G. MANJUNATHA

Hearing: 27.04.2022Pronounced: 27.04.2022

O R D E R PER MAHAVIR SINGH, VP: This appeal by the assessee is arising out of the revision order of Principal Commissioner of Income Tax, Central-1, Chennai in C.No.1523/PCIT/C-1/4/2017-18 dated 21.12.2017 u/s.263 of the Income Tax Act, 1961 (hereinafter the ‘Act’) for the assessment year 2014-15 .

1.

2 2. At the outset, it is noticed that this appeal is barred by limitation by 2 days and assessee has filed condonation petition supported by affidavit stating the reason that the office assistant of the Chartered Accountant’s office has committed mistake in handing over the appellate order to the counsel on record and thereby the delay of 2 days. The assessee stated the reason as under:- “I state that the mistake committed by the office assistant of the Chartered Accountant and the transmission delay would constitute reasonable cause to consider the prayer for condoning the delay of 2 days in filing the appeal before the Bench for the above assessment year.”

When these facts were confronted to ld.CIT-DR, he could not object the same, as cause seems reasonable and delay is very small, we condone the delay and admit the appeal.

3.

At the outset, the ld.counsel for the assessee took us through the revision order of PCIT and particularly he referred to the following para 4, which reads as under:- “4. In response to show cause notice the assessee neither attended the hearing nor filed any written submissions. Since, there was no response from the assessee it is presumed that the assessee has no objection for the proposed revision u/s.263 of the IT Act.”

The ld.counsel stated that the PCIT issued only one notice dated 09.11.2017 and finally passed revision order on 21.12.2017 but this show-cause notice was never received by assessee. According to 3 him, the assessee was not at all aware about the notice issued for revision u/s.263 of the Act and hence, he could not attend the hearing. Therefore, the ld.counsel stated that the matter can be restored back to the file of the PCIT for giving opportunity to assessee so that assessee can explain before PCIT that there is no error in the order of AO neither prejudicial to the interest of Revenue. On this, the ld.CIT-DR filed a copy of acknowledgement slip which shows that the show-cause notice was served on one Shri N.G. Krishnamoorthy on 09.11.2017. But the ld.counsel for the assessee stated that he is not aware who is N.G. Krishnamoorthy on whom service is shown by the Department and he categorically denied that there is no such person in the family of assessee namely N.G. Krishnamoorthy or any of employee. The ld.counsel stated that the Revenue can adduce evidence that who this person is. On further query from Bench, the ld.CIT-DR could not adduce any evidence that who this Shri N.G. Krishnamoorthy is. We noted that there is no evidence adduced by Revenue that notice was served on the assessee. In the absence of the same, we are of the view that the order passed by PCIT is to be set aside and matter be remanded back to the file of PCIT for providing opportunity to the assessee because the basic principles of natural justice demands that the 4 person should be heard before any adverse order. Accordingly, we remand the matter back to the file of the PCIT for fresh adjudication.

4.

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

Order pronounced in the open court on 27th April, 2022 at Chennai.

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