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Facts
The assessee's case was selected for scrutiny, and assessment was completed under Sections 143(3)/144/147. Penalty proceedings under Section 271B were initiated by the Assessing Officer for the assessee's failure to furnish an audit report under Section 44AB, despite having a turnover exceeding Rs.1 crore. The assessee filed an appeal before the CIT(A) with a 53-day delay, which the CIT(A) dismissed ex parte without examining the merits.
Held
The Tribunal observed that the CIT(A) dismissed the appeal ex parte without considering its merits. Therefore, the Tribunal remanded the entire matter back to the CIT(A) with directions to re-examine the issue afresh after providing the assessee proper and sufficient opportunities to file supporting documents and be heard.
Key Issues
Whether the ex-parte dismissal of the appeal by the CIT(A) without examining the merits of the case was justified, particularly concerning the penalty initiated for non-compliance with audit requirements under Section 44AB and the delay in filing the appeal.
Sections Cited
143(2), 143(3), 144, 147, 44AB, 271B
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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri Inturi Rama Rao & Shri Sonjoy Sarma
XXI/230 S Paliyamthuruth Anapuzha, Kodungallur Thrissur-680667, Kerala. PAN : AAFTS2292H. (Appellant) (Respondent) Appellant by : None Respondent by : Smt. Leena Lal, Snr AR. Date of Hearing : 05.06.2025 Date of Pronouncement : 13.06.2025 O R D E R Per Sonjoy Sarma: This appeal is filed by the assessee against the order dated 04.09.2024 by the National Faceless Appeal Centre (hereinafter referred to as ‘CIT(A)’] for the assessment year 2021–22.
Brief facts of the case are that the assessee filed its return of income on 28.02.22 by declaring total income of Rs.2,77,710/-. The case of the assessee was selected for scrutiny under CASS and notice u/s 143(2) was issued to the assessee. In this case, the assessment was completed u/s 143(3)/144/147 of the Act on 23.12.2022 at assessed income of Rs.4,54,393/-. During the year, the assessee has shown total turnover of Rs.8,75,83,428/-. On M/s Arakkathara Transport Services Automobiles Pvt. Ltd. perusal of the records, it was noticed that the assessee has got books of accounts audited and has furnished an audit report in Form 3CA on 15.02.22 whereas the due date of furnishing the audit report in Form 3CA was on or before 28.02.22. Due to this, it was found that the assessee was having gross turnover above Rs.1 crore and the Assessing Officer observed that the assessee has not got its books of accounts audited and has not furnished an audit report in Form 3CA as required u/s 44AB of the Act within the stipulated due date. Therefore, penalty proceedings u/s 271B of the Act was initiated against the assessee.
Aggrieved by the above order, the assessee preferred an appeal before the ld. CIT(A), however, while filing the appeal, therefore, was a delay of 53 days in filing the appeal. The ld. CIT(A) dismissed the appeal of the assessee ex parte by confirming the order of the Assessing Officer without properly examining the various details or merits of the case.
However, at the time of hearing, no one turned up on the prt of the assessee.
The ld. DR has agreed to the fact that in the interests of justice, the Tribunal may remand back the matter to the file of the ld. CIT(A) with a direction to re-examine the issue afresh.
We, after hearing the submission of the ld. DR and perusing the materials available on record, find that the appeal of the assessee was dismissed ex parte by the ld. CIT(A) confirming the order of the Assessing Officer without looking into merits of the case and without applying any independent findings on the merits of the case. In the interests of justice and fair play, we, therefore, deem it necessary to remand back the whole issue to the file of the M/s Arakkathara Transport Services Automobiles Pvt. Ltd. ld. CIT(A) with a direction to re-examine the issue afresh. We also direct the assessee to file supporting documents in order to substantiate his case before the ld. CIT(A) and the ld. CIT(A) will pass order in accordance with law after giving proper and sufficient opportunities of hearing to the assessee.
In terms of the above, the appeal of the assessee is allowed for statistical purposes.
Order pronounced on 13.06.2025.