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Facts
The assessee preferred an appeal against the order of the NFAC, which dismissed their appeal. The NFAC had affirmed additions made by the AO on various grounds, including festival and Pooja expenses, service tax penalty, commission paid to a property dealer, and delayed TDS payment. The assessee had not complied with the opportunities provided for hearing and submitting documents.
Held
The Tribunal observed that while the assessee's conduct appeared non-compliant, the appeal was filed in 2017 and considered after a significant delay, particularly during the Covid-19 period. The Tribunal noted that due to the absence of relevant documents and submissions, the issues were not adjudicated properly.
Key Issues
Whether the appeal should be remanded to the Ld. Commissioner for fresh adjudication, providing the assessee a reasonable opportunity to be heard.
Sections Cited
250, 143(3), 40A(3)
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Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the Assessee against the order dated 17.05.2023, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2014-15.
In the instant case, vide assessment order dated 20.12.2016 u/s 143(3) of the Act, various additions have been made by the Assessing Officer (AO) against which the Assessee though preferred first appeal before the Ld. Commissioner, however, despite of affording 5 opportunities, except seeking adjournment on two occasions, eventually made no compliance and therefore in the constrained circumstances, the Ld. Commissioner dismissed the appeal of the Assessee by affirming the additions of Rs.77,964/- on account of festival and Pooja expenses, Rs.17,000/- being expenses incurred, Rs.56,000/- on account of service tax penalty debited being penal in nature, Rs.21,000/- as commission paid to property dealer being disallowed u/s 40A(3) of the Act and Rs.3,92,336/- on account of delayed payment of TDS. This Court observe that though the conduct of the Assessee seems to be non-compliant, however, it is a fact that the Ld. Commissioner fixed the case for hearing on two occasions during Covid-19 period when the entire Nation was on hold and it is a fact that the Assessee had filed appeal on 25.01.2017, but the same was taken into consideration after a gap of 4 years on 11.01.2021 during Covid-19 period and thereafter on subsequent dates and ultimately decided on 17.05.2023. It is also a fact that in the absence of relevant documents and submissions which the Assessee could not file, the issues involved also remained to be adjudicated in its right perspective and proper manner by the Ld. Commissioner. Thus, considering the peculiar facts and circumstances in totality for just and proper decision the case , fair play and substantial justice, this Court is inclined to remand the instant case to the file of the Ld. Commissioner for decision afresh, suffice to say by affording reasonable opportunity of being heard to the Assessee. Thus, the case is accordingly remanded to the file of Ld. Commissioner in the said terms.
In the result, the Assessee’s appeal is allowed for statistical purposes.
Order is pronounced on dated 29th August, 2025, as per section 34{5} of the Income-Tax (Appellate Tribunal) Rules, 1963.