STAN COMMODITIES (P) LTD.,KOLKATA vs. I.T.O.,WARD-3(2), KOLKATA

The assessee in the present case is a Company, which is engaged in the business of manufacturing of M.S. Ingots. The return of income for the year under consideration was filed by it on 30.09.2012 declaring total income of Rs.28,520/-. During the course of assessment proceedings, the substantial amounts of sundry creditors shown by the assessee-company in its balance-sheet were examined by the Assessing Officer. During the Assessment Year: 2012-2013 Stan Commodities (P) Limited course of said examination, a notice under section 133(6) was issued by him to M/s. Steel and Coal Junction, one of the sundry creditors of the assessee having an outstanding balance of Rs.2,49,60,381/-. The said notice, however, could not be served by the Postal Authority at the address given by the assesese. The assessee also could not furnish any evidence to establish the existence of the said creditor. Neither the books of account for the year under consideration nor even the purchase bills issued by M/s. Steel and Coal Junction could be produced by the assessee. The Assessing Officer, therefore, treated M/s. Steel and Coal Junction as a bogus creditor and an addition of Rs.2,49,60,381/- was made by him to the total income of the assessee.

The notice issued by the Assessing Officer under section 133(6) to another creditor namely Ashirwad Steel and Industries was also returned by the Postal Authority with the comment “not known”. Although the assessee filed a ledger copy of the said party showing payments of Rs.22,00,000/- made during the year under consideration, the Assessing Officer found that cash was deposited by the assessee-company in its Bank account immediately before the said cheque payments. Since the assessee could not explain the source of the said cash deposits, an addition of Rs.22,00,000/- was made by the Assessing Officer to the total income of the assessee. Similarly a notice sent by the Assessing Officer under section 133(6) to M/s. Environment Mineral Export remained un- served by the Postal Authority as the said party could not be found at the address given by the assessee. Although the assessee claimed that a sum of Rs.30,00,000/- was received from the said party during the year under consideration through Bank, the Assessing Officer found that the said amount was received by the assessee in cash. Keeping in view that the existence of the said party was not established and the receipt of cash of Rs.30,00,000/- from the said party remained unexplained, the Assessing Officer made an addition of Rs.30,00,000/- to the total income of the assessee. For the same reason, he also made a further addition of Assessment Year: 2012-2013 Stan Commodities (P) Limited Rs.49,000/- on account of cash of Rs.49,000/- claimed to be received by the assessee from another party Ms. Ritu Poddar. Accordingly the total income of the assessee for the year under consideration was determined by the Assessing Officer at Rs.3,02,37,898/- in the assessment completed under section 143(3) of the Act vide an order dated 27.03.2015.

Against the order passed by the Assessing Officer under section 143(3), an appeal was preferred by the assessee before the ld. CIT(Appeals) and since there was no compliance on the part of the assessee to the notices issued by him fixing the said appeal for hearing from time to time, the ld. CIT(Appeals) dismissed the appeal of the assessee vide his appellate order dated 05.02.2019 passed ex-parte. Aggrieved by the order of the ld. CIT(Appeals), the assessee has preferred this appeal before the Tribunal.

We have heard the arguments of both the sides and also perused the relevant material available on record. In support of the preliminary issued raised by the assessee in this appeal challenging the impugned order passed by the ld. CIT(Appeals) ex-parte, the ld. Counsel for the assessee has submitted that the first notice stated to be issued by the ld. CIT(Appeals) fixing the appeal of the assessee for hearing on 24.12.2018 was not received by the assessee, while there was very short time which was made available to the assessee to comply with the notices issued subsequently fixing the appeal of the assessee for hearing in a short succession on 25.01.2019 and 04.02.2019. He has contended that proper and sufficient opportunity of being heard thus was not given by the ld. CIT(Appeals) to the assessee before dismissing the appeal of the assesese vide his impugned order passed ex-parte and this position clearly apparent from the perusal of the impugned order of the ld. CIT(Appeals) is not disputed even by the ld. D.R. We, therefore, find it fair and proper and in the interest of justice to set aside the impugned order passed by the ld. CIT(Appeals) ex-parte and remit the matter back to him for Assessment Year: 2012-2013 Stan Commodities (P) Limited disposing of the appeal of the assessee afresh on merit in accordance with law after giving proper and sufficient opportunity of being heard to the assessee. As undertaken by the ld. Counsel for the assessee, the assessee shall make due compliance before the ld. CIT(Appeals) and shall extend all the possible cooperation in order to enable the ld. CIT(Appeals) to dispose of the appeal afresh expeditiously.

In the result, the appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on June 29, 2020.