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Income Tax Appellate Tribunal, DELHI BENCH ‘C’ : NEW DELHI
Before: SHRI H.S. SIDHU & SHRI L.P. SAHU
PER H.S. SIDHU, JM
The Assessee has filed this Appeal against the Order dated
03.5.2018 of the Ld. CIT(A)-22, New Delhi pertaining to assessment
year 2014-15 on the following grounds:-
1 That the learned Commissioner of Income Tax
(Appeals) has grossly erred in law and on facts in passing
the impugned order in utter disregard of the statutory
provisions contained under section 250(6) of the Act by
dismissing the appeal of the appellant ex parte, thereby,
violating the principles of natural justice.
2 That the learned Commissioner of Income Tax
(Appeals) has overlooked the provisions of Section
250(6) of the Act, as the order passed by him has not
been decided on merits and is thus, wholly non speaking
and deserves to be set aside on this ground alone.
3 That the learned Commissioner of Income Tax
(Appeals) ought not to have decided the appeal of the
appellant ex parte, as due appearance was caused by
the counsel of assessee - appellant on the last date of
hearing i.e. on 16.04.2018 and the matter was adjourned
at the behest of learned CIT (A) and no order sheet entry
was made signed by him, in view of CBDT instruction F.
No. 380/1/2018-IT(B), as he stated that only matters
involving tax effect of less than Rs. 10 lacs would be
disposed off till 30.06.2018
3.1 The learned CIT (A) while disposing off the appeal ex
parte, was not justified in not accepting the submissions
made in writing, on the pretext that the same may be
taken up on the date of hearing, as and when, the same
will be communicated through notice.
That the learned Commissioner of Income Tax
(Appeals) has further erred both in law and on facts
in upholding the order of assessment at a loss of
Rs.60,77,49,876/-, as against the returned loss of Rs.
63, 95, 61. 964/- in an order of assessment dated
30.12.2016 under section 143(3) of the Act.
4.1 That further, the learned Commissioner of Income
Tax (Appeals) has also failed to appreciate the fact that
addition so made by learned assessing officer is based on
preconceived notions and by arbitrarily brushing aside
the detailed submissions/evidences/material placed on
record, which were furnished in order to support the fact
that no addition was called for in the instant case.
That the learned Commissioner of Income Tax
(Appeals) has erred both in law and on facts in sustaining
the addition of Rs. 2, 50, 00, 000/- made under section
68 of the Act, being unsecured loan received by the
appellant from M/s Skybase Infra Pvt. Ltd.
5.1 That in doing so, the learned CIT (A) has grossly
erred in failing to appreciate that the appellant had filed
complete documentary evidences which established the
genuineness of the transaction and further, the same was
duly confirmed by the said party by filing a reply directly
to the learned ACIT, as such, burden which lay upon the
appellant stood discharged and further, the learned ACIT
based his decision purely on suspicion, surmises and
conjectures, without carrying out any investigation/
verification and as such, the addition so made should be
deleted.
That the learned Commissioner of Income Tax
(Appeals) has erred in law and on facts in sustaining an
adhoc disallowance of Rs.7,24,690/- on account of
business promotion expenses.
That the learned Commissioner of Income Tax
(Appeals) has further erred in law and on facts in
sustaining a disallowance of Rs. 1,284/- on account of
interest on TDS claimed and wrongly disallowed under
section 37 of the Act.
That the learned Commissioner of Income Tax
(Appeals) has further erred in law and on facts in
sustaining a disallowance of Rs. 7,75,839/- on account of
stale cheques and the said addition in unjustified and
contrary to facts of the instant case.
That the learned Commissioner of Income Tax
(Appeals) has further erred in law and on facts in
sustaining a disallowance of Rs. 36, 00, 000/- on account
of expenses claimed in the nature of penalty, whereas,
the said expense were paid during the regular running of
the business and were not in nature of penalty and thus,
were allowable under the Act.
That the learned Commissioner of Income Tax
(Appeals) has erred in law and on facts in sustaining a
disallowance of Rs.17,16,275/- on account of non-
deduction of TDS on provision of legal and professional
expenses.
At the time of hearing, Ld. counsel for the assessee has drawn
our attention towards Section 250(6) of the Income Tax Act, 1961
and stated that as per Section 250(6) of the Act, Ld. CIT(A) should
have decided the case of the assessee on merits, after adjudicating
all the grounds raised by the assessee in the grounds of appeal in
Form No. 35. But the Ld. CIT(A) has not followed the prescribed
procedure under the law. Therefore, the impugned order is liable to
be cancelled. He further stated that assessee appeared before the
Ld. CIT(A) many times and also filed adjournment applications and
joined the proceedings, but the Ld. CIT(A) has not given sufficient
opportunity of hearing and dismissed the appeal of the assessee in
limini, without deciding the issue in dispute on merits, which is
contrary to the provisions of law and, therefore, he requested that
the issues in dispute may be remitted back to the Ld. CIT(A) to
decide the same afresh, as per law after giving adequate opportunity
of being heard to the assessee.
On the other hand, Ld. DR relied upon the order of the Ld.
CIT(A) and stated that Ld. CIT(A) has given various opportunities to
the assessee, but the assessee remained non-cooperative and as a
result thereof, the Ld. CIT(A) has no option but to dismiss the appeal
of the assessee in limini. But he agreed for setting aside the issues
in dispute to the file of the Ld. CIT(A) for deciding the same afresh,
subject to the condition that if this Bench directed the assessee
through his counsel to appear before the Ld. CIT(A) to substantiate
its claim on the fixed date and Ld. CIT(A) will not issue any notice
to the assessee.
We have heard both the parties and perused the records as
well as the relevant provisions of law, we are of the view that there is
no doubt assessee remained non-cooperative before the Ld. CIT(A)
and the Ld. CIT(A) has passed the exparte order, without discussing
in detail the facts and circumstance of the case and also did not
deal the issue on merit and passed a non-speaking order, which in
our opinion, is not in accordance with the principles of natural
justice and it is an erroneous approach. After reading Section
250(6) of the Act, we are also of the considered view that Assessee’s
case should be decided on merits, which the Ld. CIT(A) has not done.
However, it is a settled law that even an administrative order has to
be speaking one. In this regard we draw support from Hon’ble
Apex Court in the case M/s Sahara India (Farms) Vs. CIT & Anr. in
[2008] 300 ITR 403 wherein it has been held that even “an
administrative order has to be consistent with the rules of natural
justice”.
4.1 In the background of the aforesaid discussions and in the
interest of justice as well as agreed by both the parties, we remit
back the issues in dispute to the files of the Ld. Commissioner of
Income Tax (Appeals) for hearing on 22.05.2019 at 10.00 AM with
the directions to consider each and every aspects of the issues
involved in the Appeal and decide the same afresh, after considering
all the evidences/documents and pass a speaking order. It is made
clear that no notice for hearing will be issued by the Ld. CIT(A).
Assessee is also directed through his Counsel to appear before the
Ld. CIT(A) on 22.5.2019 at 10.00 AM for hearing to substantiate
its case and file all the necessary documents before him and did not
take any unnecessary adjournment in the case.
In the result, Assessee’s appeal is allowed for statistical purposes. Order pronounced on 13-03-2019.
Sd/- Sd/- (L.P. SAHU) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated :13-03-2019
SR BHATANGAR