What did the Tribunal hold?

The Tribunal restored the matter to the CIT(A) for fresh adjudication, emphasizing principles of natural justice. The assessee was directed to substantiate their claims, and an adequate opportunity of being heard was to be provided.

The assessee's appeal before the CIT(A) was dismissed ex-parte due to non-appearance, allegedly because notices were not sent to the correct address or by the specified method. The assessee also faced an ad-hoc disallowance of 45% of administrative and other expenses.

What were the issues?

Whether the ex-parte dismissal of the appeal by the CIT(A) was justified due to improper service of notices, and whether the disallowance of administrative expenses was reasonable.

Arriva Jewellery vs ACIT | ITAT Mumbai 2019

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: HON’BLE SHRI VIKAS AWASTHY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Appellant: Shri S. Michael Jerald- Ld. DR

सुनवाई क� तार�ख/ : 18/12/2019 Date of Hearing घोषणा क� तार�ख / : 18/12/2019 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member): - 1. Aforesaid appeal by assessee for Assessment Year [in short referred to as ‘AY’] 2014-15 contest the order of Ld. Commissioner of Income-Tax (Appeals)-36, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)-

Arriva Jewellery Assessment Year-2014-15 36/IT 402/ACIT-24(1)/2016-17 dated 30/07/2018 on following grounds of appeal: - The Commissioner of Income Tax (Appeals) -36 erred in: 1.dismissing the appeal on ground on non-appearance and non-compliance. He erred in not appreciating that in Form 35 the Appellant had specifically opted to not receive notices by email and had also mentioned a correspondence address which was different from the registered address of the Appellant. He erred in sending notices by email and in sending them physically at an address other than what was opted for by the Appellant. 2.confirming a disallowance of 45% of administrative and other expenses.

2. The learned Authorized Representative for assessee, at the outset, drawing our attention to the ground-1 of the appeal, submitted that hearing notices were not sent by learned first appellate authority in the manner specified in Form No. 35 which resulted into ex-parte dismissal of assessee’s appeal. The Ld. AR also pleaded for reasonable estimation of disallowances. The Ld. DR, on the other hand, submitted that the matter may be restored back to the file of Ld. CIT(A) to take a view in the matter.

3. Upon careful consideration, we find that the assessee has been saddled with adhoc disallowance of administrative & other expenditure to the extent of 45% in an assessment framed u/s 143(3) on 16/12/2016. Upon further appeal, the assessee could not appear before learn first appellate authority, apparently for reasons stated by Ld. AR, before us. The same resulted into ex-parte dismissal of the appeal. Keeping in view the pleading made before us and keeping in view principles of natural justice, we deem it fit to restore the matter back to the file of Ld. CIT(A) for adjudication de-novo with a direction to the assessee to substantiate his

ARRIVA JEWELLERY,MUMBAI vs. ACIT 24 (1), MUMBAI

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