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Facts
The assessee's assessment was re-opened based on properties sold below circle rate, leading to an addition of Rs.68,05,500/-. The assessee's appeal to the CIT(A) was dismissed ex-parte due to non-representation.
Held
The Tribunal found that the CIT(A) had passed an ex-parte order without adjudicating the grounds raised by the assessee. The application of Section 50C was also questioned. The Tribunal set aside the CIT(A)'s order.
Key Issues
Whether the CIT(A) erred in passing an ex-parte order without proper adjudication and whether the application of Section 50C was justified.
Sections Cited
148, 147, 144B, 50C
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Income Tax Appellate Tribunal, LUCKNOW BENCH “B”, LUCKNOW
Before: SHRI KUL BHARAT & SHRI ANADEE NATH MISSHRA
PER KUL BHARAT, VICE PRESIDENT.:
This appeal, by the assessee, is directed against the order of the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, dated 27.04.2024, pertaining to the assessment year 2013-14. The assessee has raised the following grounds of appeal: -
“1 That the CIT(Appeals) and Ld AO passed ex-parte order without giving proper opportunity of being heard, which is liable to be cancelled. 2. That the Ld. CIT(A) erred on facts and in law in passing the ex-parte order as the basis of initiation of reassessment proceedings by issue of notice u/s 148 of the Income Tax Act, 1961, its continuation and culmination vide order u/s 147 r.w.s. 144B of the Income Tax Act, 1961 dated 30.03.2022 is bad in law and liable to be cancelled.
Page 2 of 4 3. That the Ld. CIT(A) erred on facts and in law in confirming the addition of Rs.68,05,500/- as per section 50C of the Income Tax Act, 1961 is contrary to the facts and circumstances of the case. 4. The appellant reserves a right to add/alter/amend any ground of appeal at the time of its hearing.”
2. The facts giving rise to the present appeal are that in this case, the assessment was re-opened on the basis that the assessee had sold certain properties below the circle rate. Before Assessing Officer, the assessee had raised various objections including the application of Section 50C of the Income Tax Act, 1961 (“Act”, for short) in the facts and circumstances of the case. However, the objections of the assessee were not found acceptable to the assessing authority. The Assessing Officer proceeded to frame assessment by making addition of Rs.68,05,500/-. Thereby, he assessed income at Rs.71,46,000/- against the returned of income of Rs.3,40,500/-. Aggrieved by this, the assessee preferred an appeal before the Ld. CIT(A), before Ld. CIT(A) also, there was no representation on behalf of the assessee, therefore the appeal was dismissed exparte to the assessee. Now, the assessee is in appeal before this Tribunal.
At the time of hearing, no one attended the proceedings on behalf of the assessee. The appeal was taken up for hearing in the absence of the assessee and is being disposed off on the basis of the material available on record.
On the other hand, the Ld. Departmental Representative (DR) supported the orders of the lower authorities.
Heard, the Ld. Departmental Representative and perused the material available on record. We find that the case before the assessing authority of the assessee was that the valuation Page 3 of 4 adopted by the assessing authority is in respect of the industrial land but in the case of the assessee, it was agriculture land where the assessee had established Brick Kilin (manufacturing unit) and the entire unit was sold. Therefore, the application of Section 50C of the Act is not justified. Before the Ld. CIT(A), the assessee had raised three grounds of appeal primarily challenging the re-opening of the assessment and also adoption of value by applying the provisions of Section 50C of the Act. It is seen from the impugned order that the Ld. CIT(A) has not adjudicated the grounds raised by the assessee by giving clear finding on the grounds raised by the assessee. The Ld. CIT(A) has passed the order exparte to the assessee without adverting to the grounds raised and deciding the issue on merits. Under these facts, we deem it fit and proper and to sub-serve the interest of principles of natural justice to set aside the impugned order and restore the grounds of the appeal to the Ld. CIT(A) for deciding the grounds afresh and by giving clear finding on the grounds raised by the assessee by way of speaking order. Grounds raised in this appeal are allowed for statistical purpose. Needless to say that the assessee would provide all the information which is relevant and necessary for adjudication of grounds of appeal.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 18/03/2025.