SHRI. PRABHAKAR REDDY,BANGALORE vs. INCOME TAX OFFICER, WARD- 4(3)(3), BANGALORE

The assessee in an individual. For Assessment Year 2011-12, the assessee filed return of income declaring total income of Rs.2,71,909/-. An order of assessment was passed by the AO making an addition on account of unexplained expenditure under section 69-C of the Income Tax Act, 1961 (Act) of 40,47,524/- . Similarly, in Assessment Year 2012-13, an order under section 143(3) was passed making an addition of Rs.14,84,000/- under section 69-C of the Act to the income returned by the assessee.

Against both the aforesaid orders, assessee filed appeals before the CIT(A). On 31.07.2019, both the appeals were fixed for hearing before the CIT(A) and on that date, the assessee filed an application for adjournment requesting that the appeals of the assessee for Assessment Year 2011-12 and 2012-13 should be taken up together for hearing. The assessee sought one week’s time in this regard. There was no hearing on that date. The CIT(A) however fixed both the appeals for hearing on 02.08.2019 and there was no notice admittedly issued for this fresh date of hearing. On 02.08.2019, none appeared on behalf of the assessee and under the circumstances, the CIT(A) proceeded to decide the appeal on the basis of the material available before him and ultimately dismissed both the appeals of the assessee finding no merit.

Aggrieved by the aforesaid orders of the CIT(A), the assessee has preferred present appeal before the Tribunal.

The main argument of the learned Counsel for the assessee is that there was lack of proper opportunity of being heard afforded to the assessee by the CIT(A) and therefore order of the CIT(A) should be set aside and the CIT(A) should be directed to hear the appeal afresh after affording opportunity of being heard to the assessee. The learned DR supported the orders of CIT(A) deciding the appeals ex-parte.

I have heard the rival submissions and I find that for the hearing on 02.08.2019, no notice was issued to the assessee. Admittedly, for the hearing on 31.07.2019, there was a request for adjournment by one week. If that request is accepted, then the hearing should have been on or after 07.08.2019. Since the appeal was posted for hearing on 02.08.2019 allowing only 2 days adjournment, the CIT(A) ought to have put the assessee on notice regarding the date of hearing. Since such a course of action was not followed, we are of the view that there was violation of principles of natural justice. Accordingly, we set aside the orders of the CIT(A) and remand the case to the CIT(A) for fresh adjudication on merits, after affording assessee opportunity of being heard.

In the result, the appeals by the Assessee is treated as allowed for statistical purposes.