NARENDRA SACHIN ENTERPRISES,LUCKNOW vs. ITO NFAC, LUCKNOW

The facts of the case, in brief, are that the assessee was engaged in trading of liquor business. The assessee filed its return of income declaring total income of Rs.95,140/-. The Assessing Officer processed the return filed by the assessee and passed assessment order dated 26/08/2021 under section 144 read with section 144B of the I.T. Act and determined the total income of the assessee at Rs.27,71,185/- by making disallowance of Rs.19,26,000/- on account of unexplained license fees and Rs.7,50,045/- on account of disallowance of expenditures. The Assessing Officer also initiated penalty proceedings under section 271A(1)(d) of the Act and a penalty of Rs.16,53,800/- was imposed under section 271A of the Act. Being aggrieved, the assessee went in appeal before the learned CIT(A) against the disallowances made and against the levy of penalty. The learned CIT(A), vide impugned appellate orders each dated 19/09/2024, dismissed both the appeals of the assessee. Now the assessee is in appeal before the Income Tax Appellate Tribunal.

During the course of hearing before the Income Tax Appellate Tribunal, none was present. In absence of any representation from assessee’s side, learned Departmental Representative was heard and materials available on record were perused. On perusal of records, it is seen that the assessment order as well as the impugned appellate orders of the learned CIT(A), were passed ex-parte qua the appellant assessee. Further, reasonable opportunity of being heard was not provided to the assessee. Learned Departmental Representative left the matter to the discretion of the Bench. In view of the foregoing, both the orders of learned CIT(A) are set aside and the issues in dispute are restored back to the file of the Assessing Officer with the direction to pass de novo assessment order in & 667/Lkw/2024 Assessment Year:2018-19 3 accordance with law on the specific issues after providing reasonable opportunity of being heard to the assessee.