MARUTI JEWELS PVT LTD.,MUMBAI vs. ITO 12(3)(3), MUMBAI

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ITA 4294/MUM/2019Status: DisposedITAT Mumbai02 March 2021AY 2010-114 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the CIT(A)'s order and restored the matter for a de novo decision. This was because the CIT(A)'s order did not confirm whether the notices for hearing were received by the assessee.

What were the facts?

The assessee's appeal was dismissed ex-parte by the CIT(A) for non-appearance. The AO had reopened the assessment based on information about accommodation entries for purchases and made an addition for alleged non-genuine purchases.

What were the issues?

Whether the CIT(A) erred in dismissing the appeal without ensuring the assessee received hearing notices, and whether the reopening of assessment was valid.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC” MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI N.K. PRADHAN

For Respondent: Ms. Smita Verma, DR
Hearing: 16/02/2021Pronounced: 02/03/2021

ORDER PER N.K. PRADHAN, A.M. This is an appeal filed by the assessee. The relevant assessment year is 2010-11. The appeal is directed against the order of the Commissioner of Income Tax (Appeals)-20, Mumbai [in short ‘CIT(A)’] and arises out of the assessment completed u/s 143(3) r.w.s. 147 of the Income Tax Act 1961, (the ‘Act’).

Though the case was fixed for hearing on 15.12.2020 and 16.02.2021, neither the assessee nor its authorized representative appeared before the Bench on the above dates. As there is non-compliance by the assessee, we are 2 Maruti Jewels Pvt. Ltd. proceeding to dispose off this appeal after examining the materials available on record and hearing the Ld. Departmental Representative (DR).

2.

The grounds of appeal filed by the assessee read as under :

1. On the facts and circumstances of the Appellants case and in law the Ld. CIT(A) erred in dismissing the appeal filed providing an opportunity of being heard.

2. On the facts and circumstances of the Appellant’s case and in law the Ld. CIT(A) erred in confirming the reopening of assessment u/s 147by issue of notice u/s 148 which is merely due to change of opinion and therefore the reopening is bad in law. 3. On the facts and circumstances of the Appellant’s case and in law the Ld. CIT(A) erred in confirming the reopening of assessment u/s 147 by issue of notice u/s 148 dated 09.06.2016 which is barred by limitation in view of the first proviso to section 147 of Income Tax Act, 1961. 4. On the facts and circumstances of the Appellant’s ease and in law the Ld. CIT(A)erred in confirming that the appellant has entered into accommodation transactions of Purchases with Shri Rajendra Jain Group. Sanjay Choudhary Group and Dharmichand Jain Group without any material evidence on record. 5. On the facts and circumstances of the Appellant’s case and in law the Ld. CIT(A) erred in confirming the addition of Rs.1,15,895/- being alleged non-genuine purchases from M/s Kangan Jewels Pvt. Ltd. by invoking section 69C of the Income Tax Act, 1961. As per para 14 of the impugned order.

3.

Briefly stated, the facts of the case are that the assessee filed its return of income for the assessment year (AY) 2010-11 on 30.11.2011 declaring total income at Rs.8,74,350/-. The Assessing Officer (AO) passed an order u/s 143(3) on 14.03.2013, assessing the total income at Rs.10,75,620/-. Subsequently, the AO received information from the Director General of Income Tax (Inv), Mumbai and Deputy Commissioner of Income Tax, Central 3 Maruti Jewels Pvt. Ltd. Circle-4, Surat that the assessee had taken accommodation entries on purchases. Accordingly, he issued notice u/s 148 dated 09.06.2016 to the assessee and passed an order dated 18.12.2017 u/s 143(3) r.w.s. 147 of the Act determining the total income at Rs.11,91,520/-.

4.

Aggrieved by the order of the AO, the assessee filed an appeal before the Ld. CIT(A). We find that vide order dated 29.03.2019, the Ld. CIT(A) passed an ex-parte order dismissing the appeal. He has mentioned that though the case was fixed for hearing on 14.03.2019, 22.03.2019 and 28.03.2019, none appeared for the assessee. Reiterating the order of the AO, the Ld. CIT(A) dismissed the appeal filed by the assessee.

5.

Before us, the Ld. DR supports the order passed by the Ld. CIT(A).

We have heard the Ld. DR and perused the relevant materials on record. In the instant case, the AO has made an addition of Rs.1,15,895/- treating it as on account of bogus purchases. There is no mention in the order of the Ld. CIT(A) whether the notices issued by his office fixing the case for hearing on 14.03.2019, 22.03.2019 and 28.03.2019 was received by the assessee or not. A notice intimating the date fixed for hearing is to be received by the assessee.

In view of the above facts, we set aside the order of the Ld. CIT(A) and restore the matter to him to pass a de novo order, after giving reasonable opportunity of being heard to the assessee. We direct the assessee to file the relevant documents/evidence before the Ld. CIT(A) on the date of hearing. 4 Maruti Jewels Pvt. Ltd. 6. In the result, the appeal is allowed for statistical purposes.

Order pronounced in the open Court on 02/03/2021.

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