M/S V N EXPORTS,MUMBAI vs. ASST CIT 19(3), MUMBAI

This appeal by the assessee is directed against an ex-parte order of Commissioner of Income Tax (Appeals) -30, Mumbai [in short ‘the CIT(A)] dated 29/11/2019 for the assessment year 2010-11.

Shri Rahul Sarda appearing on behalf of the assessee submitted that the CIT(A) without affording opportunity of hearing to the assessee has enhanced the disallowance made in respect of alleged bogus purchases. The ld. Authorized Representative of the assessee submitted that assessment for assessment year 2010- 11 was reopened on the ground that assessee has allegedly obtained accommodation entries from the concern belonging to Bhanwarlal Jain Group. The Assessing Officer estimated suppressed profit margin @5% and made addition of Rs.30,97,074/-. Aggrieved by the assessment order dated 23/03/2016 passed u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 ( in short ' the Act'), the assessee field appeal before the CIT(A). The CIT(A) allegedly issued notice of hearing on 16/09/2019 and 03/10/2019, however, none of the aforesaid notices were ever received by the assessee / appellant. The ld. Authorized Representative of the assessee submitted that the assessee has prima-facie good case in its favour and has sufficient evidences to prove genuineness of the purchases. The ld. Authorized Representative of the assessee prayed that an opportunity may be granted to present the case before the CIT(A).

On the other hand, Ms. Smita Verma representing the Department vehemently defended the impugned order. The ld.Departmental Representative submitted that the CIT(A) had issued notice to the assessee on the address furnished in Form No.35, however, the assessee failed to appear before the First Appellate Authority.

Both sides heard, orders of authorities below examined. A perusal of the impugned order shows that the notice of hearing of the appeal was issued by the CIT(A) on two occasions i.e. on 16/09/2019 and 03/10/2019. However, it is not emanating from the order whether the said notices were duly served on the assessee or not. The requirement of law is that notices should be served on the assessee. Be that as it may, without commenting on merits of addition, I deem it appropriate to restore this appeal back to the file of CIT(A) for denovo adjudication after affording reasonable opportunity of hearing to the assessee, in accordance with law. The assessee is directed to appear before the CIT(A) upon service of notice and co- operate in the proceedings. The impugned order is set-aside and the appeal by the assessee is allowed for statistical purpose.

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