M/S.INTEGRATED TEXTILES CONNECTIONS P. LTD.,,BANGALORE vs PR. COMMISSIONER OF INCOME TAX, BANGALORE

Income Tax Appellate Tribunal, ‘C’ BENCH : BANGALORE

Before: SHRI CHANDRA POOJARI & SMT. BEENA PILLAI

For Appellant: Shri V Srinivasan, Advocate

For Respondent: Shri Pradeep Kumar, CIT (DR)

ORDER PER BEENA PILLAI, JUDICIAL MEMBER Present appeal has been filed by assessee against order passed by Ld.CIT under section 263 of the Act by order dated 30/03/2016. 2. At the outset, Ld.AR submitted that, only grievance that assessee has in impugned order is regarding direction by Ld.Pr.CIT to Ld.AO to disallow payments made by way of cash/cheque under section 40A(3) of the Act.

Admittedly, Ld.AO did not verify the issue considered by Ld.Pr.CIT in 263 proceedings. It has been submitted that, in 263 proceedings Ld.Pr.CIT cannot direct assessing officer to make addition, rather a direction for adjudicating the issue can only be made.

Ld.AR. Submitted that, pursuant to order passed under section 263 Ld.AO passed order making addition in hands of assessee, without offering opportunity of being heard, causing violation of principles of natural justice.

Ld.CIT.DR relied on order passed by Ld.Pr.CIT. We have perused submissions advanced by both sides in light of records placed before us. Admittedly, Ld.Pr.CIT in impugned order, directed Ld.AO to make addition in hands of assessee. It has been submitted that Ld.AO passes order giving effect to section 263 order on 30/6/2016, without issuing any notice to assessee. Assessee thus has not been granted opportunity of being heard before Ld.AO. Such is not the mandate of section 263. We therefore, set aside order dated 30/6/2016 passed by Ld.AO giving effect to direction of Ld.Pr.CIT. LdAO is directed to issue notice to assessee in respect of the issue considered by Ld.Pr.CIT in impugned order. Needless to say that, proper opportunity of being heard shall be granted to assessee. Assessee is directed to file all requisite details in support of its contention. Based on evidences filed by assessee, Ld.AO shall pass a reasoned order in accordance with law. In the result, appeal filed by assessee stands allowed for statistical purposes. Order pronounced in open court on Order pronounced in the open court on 2nd Sept, 2020. Sd/- Sd/- (CHANDRA POOJARI) (BEENA PILLAI) Accountant Member Judicial Member Bangalore, Dated, the 2nd Sept, 2020. /Vms/ Copy to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR, ITAT, Bangalore 6. Guard file

M/S.INTEGRATED TEXTILES CONNECTIONS P. LTD.,,BANGALORE vs. PR. COMMISSIONER OF INCOME TAX, BANGALORE