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Facts
The assessee, MM Import and Export, a partnership firm engaged in timber business, filed a nil return for AY 2013-14. The AO completed assessment under Section 143(3), making additions of Rs. 4,19,849/- for interest (invoking Section 40(a)(ia) due to TDS non-compliance) and Rs. 35,46,000/- which was in the original but not revised return. The CIT(A) confirmed the additions.
Held
The Tribunal found that the AO failed to consider the revised return and did not provide the assessee with a reasonable opportunity to explain income variations. It also noted that the CIT(A) did not address the assessee's written submissions. Consequently, the orders of the lower authorities were set aside, and the matter was restored to the AO for fresh adjudication.
Key Issues
Whether the lower authorities erred by not considering the revised return, not providing adequate opportunity, and not addressing the assessee's written submissions, warranting a remand for fresh adjudication.
Sections Cited
143(3), 40(a)(ia)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
Assessment Year: 2013-14 MM Import and Export .......... Appellant 709E, Avoly Panchayat, Adooparambu Muvattupuzha, Ernakulam 686661 [PAN: AAOFM2699B] vs. ITO, Ward-1 & TPS, Thodupuzha .......... Respondent Appellant by: ------- None ------- Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 26.05.2025 Date of Pronouncement: 23.06.2025 O R D E R This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-2, Noida [CIT(A)] dated 31.03.2025 for Assessment Year (AY) 2013-14.
Brief facts of the case are that the appellant is a partnership firm engaged in the business of export and import of timber. The return of income for AY 2013-14 was filed on 30.09.2013 declaring Nil income. Against the said return of income, the assessment was completed by the ITO, Ward-1, Thodupuzha (hereinafter called "the AO") vide order dated 12.12.2016 passed u/s. 143(3) of the Income Tax Act, 1961 (the Act) after making addition of Rs. 4,19,849/- MM Import and Export being the interest paid to Sundaram Finance and L&T Finance, for noncompliance of TDS provisions invoking provisions of section 40(a)(ia) of the Act. The AO also made addition of Rs. 35,46,000/- which was shown in the original return of income but not shown in the revised return of income.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO.
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
When the appeal was called on nobody appeared on behalf of the assessee, despite due service of notice of hearing. Therefore, I proceeded to dispose of the appeal after hearing the learned Sr. DR.
On a mere perusal of the assessment order it would reveal that the AO, without taking into consideration the revised returned income, merely proceeded to assess the income based on the original return of income filed. The appellant should have been given reasonable opportunity to explain the variation between the original return of income and revised return of income. Similarly, the CIT(A) ought to have dealt with the written submissions filed by the assessee during the course of proceedings before the CIT(A). Therefore, the orders passed by the learned lower authorities cannot be sustained. Therefore the matter is restored to the file of the AO for fresh adjudication in accordance with law.
Order pronounced in the open court on 23rd June, 2025.