THE KANYAKUMARI DISTRICT CENTRAL CO-OPERATIVE BANK LIMITED,KANYAKUMARI vs. PCIT, MADURAI

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ITA 919/CHNY/2020Status: DisposedITAT Chennai21 March 2022AY 2015-163 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that while a show-cause notice is not strictly required in revisionary proceedings, an opportunity of hearing must be granted. Due to the COVID-19 situation preventing the assessee from availing this opportunity, the matter was restored to the Principal Commissioner.

What were the facts?

The assessee challenged a revisional order passed under Section 263. The assessee could not attend the revisional proceedings due to the COVID-19 pandemic, despite being issued a show-cause notice and seeking adjournments.

What were the issues?

Whether the revisional order passed under Section 263 is valid when the assessee could not avail the opportunity of hearing due to the COVID-19 pandemic. The validity of the assessment order allowing deduction under Section 36(1)(viia) was also questioned.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3),Section 36(1)(viia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, CHENNAI

Before: HON’BLE SHRI MAHAVIR SINGH & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Appellant: Shri S. Sridhar (Advocate)-Ld. A.R, Shri R.N. Siddappaji (CIT) –Ld. DR
For Respondent: Shri R.N. Siddappaji (CIT) –Ld. DR

आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. In this appeal for Assessment Year (AY) 2015-16, the assessee challenges the validity of revisional order dated 12.09.2020 passed u/s 263 by Principal Commissioner of Income Tax, Madurai-1, Madurai [Pr.CIT]. 2. During hearing before us, it transpires that the assessee did not attend the revisional proceedings despite the fact that a show-cause 2 - notice was issued to the assessee on 06.03.2020. The assessee sought adjournment on that date. The assessee was provided with another opportunity to represent his case on 23.03.2020 wherein the assessee expressed inability to comply considering the situation arising out of corona virus infection in the country. Under these circumstances, the assessment order framed by Ld. AO u/s 143(3) on 12.10.2017 was held to be erroneous and prejudicial to the interest of the revenue in view of the fact that deduction claimed u/s 36(1)(viia) was wrongly allowed. Accordingly, Ld. AO was directed to redo the assessment after due verification. Aggrieved as aforesaid, the assessee is in further appeal before us.

3.

Drawing attention to the adverse situation arising out of Covid-19 situation, Ld. AR pleaded for another opportunity. The Ld. CIT-DR, on the other hand, cited the decision of Hon’ble High Court of Madras in M/s Laxmi Vilas Bank V/s JCIT (TCA No.1370 of 2008 dated 11.10.2018) for the submission that the statutory provision do not envisages issuance of show-cause notice to the assessee in case of revisionary proceedings u/s 263.

4.

Upon careful consideration of material facts, we find that there is no quarrel as to the proposition that issuance of show-cause notice to the assessee is not required in case of revisionary proceedings u/s 263. The only requirement is that an opportunity of hearing should be granted to the assessee which is the case of the present assessee before us. We find that though the opportunity of hearing was granted to the assessee, however, the same could not be availed by the assessee owing to adverse situation arising out of Covid-19 infection spreading throughout the country. Therefore, keeping in view the principle of natural justice, we 3 - restore the matter of revision u/s 263 back to the file of Ld. Pr. CIT with a direction to the assessee to substantiate his case forthwith. The Ld. Pr. CIT is free to order for revision u/s 263 in accordance with law after considering the reply of the assessee.

5.

The appeal stand allowed for statistical purposes.

Order pronounced on 21st March, 2022.

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