VIVID COLORS PVT. LTD.,BIHAR, PATNA vs. DCIT-CIRCLE 2, PATNA, BIHAR, PATNA

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ITA 113/PAT/2025Status: HeardITAT Patna18 July 2025AY 2011-124 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal considered the order passed by the Ld. CIT(A) and the affidavit filed by the assessee's AR. The Ld. CIT(A) had passed an ex-parte order. The affidavit explained the reasons for non-compliance, including the impact of COVID-19, the accountant's ill health, and the subsequent discovery of the order. The assessee provided an undertaking to make proper compliance if the matter was restored. The Revenue did not object to the restoration. In light of these submissions and the ex-parte nature of the lower appellate authority's order, the Tribunal was inclined to restore the appeal to the file of the Ld. CIT(A) for fresh adjudication. The Ld. CIT(A) was directed to pass a fresh order after hearing the assessee, and the assessee was directed to cooperate in the proceedings. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Vivid Colors Pvt. Ltd., filed its return for Assessment Year 2011-12 showing a loss. The case was reopened based on information from DDIT, Unit-1, Kolkata, and a notice under Section 148 was issued. The assessee complied and filed a fresh return showing a loss. Subsequently, notices under Section 143(3) and 142(1) were issued, but the assessee did not comply. The Assessing Officer (AO) noted that the assessee was a beneficiary of accommodation entries totaling ₹1,60,00,000/- received during FY 2010-11, with the nature and source of funds remaining unexplained. Consequently, the AO passed an assessment order under Section 144 read with Section 147, assessing the income at ₹1,60,00,000/- and determining a net tax payable of ₹1,11,33,950/-. The assessee's appeal before the National Faceless Appeal Centre (NFAC), Delhi, was dismissed due to non-compliance. The present appeal is filed by the assessee against this dismissal order.

What were the issues?

1. Whether the Tribunal should restore the appeal to the file of the Ld. CIT(A) for fresh adjudication, considering the assessee's request for an opportunity to present its case and the ex-parte nature of the order passed by the Ld. CIT(A)? Assessee's Contention: The assessee, through its AR, requested an opportunity to place its case before the Ld. CIT(A) as the order passed was ex-parte. An affidavit was filed by a director of the assessee company explaining the non-compliance due to COVID-19, the accountant's ill health, and subsequent discovery of the order. The assessee undertook to make proper compliance if the matter was restored. The assessee relied on the affidavit to support its plea. Revenue's Contention: The Revenue's DR did not raise any objection to the assessee's request for restoration.

Which sections of the Income-tax Act were involved?

Section 148,Section 143(3),Section 142(1),Section 144,Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘Patna’ BENCH, PATNA

Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM

For Appellant: Shri Parna Dutta, AR
For Respondent: Shri Ashwani Kr. Singal, DR
Hearing: 08.07.2025Pronounced: 18.07.2025

(Assessment Year: 2011-12) Vivid Colors Pvt Ltd. C/o Subash Agarwal & DCIT-Circle 2, Patna 4th Floor, Lok Nayak Jai Prakash Associates, Advocates Siddha Gibson, 1, Gibson Lane, Bhawan Fraser Road, Vs. Suite 213, 2nd Floor, Kolkata- Patna, Bihar 700069, West Bengal (Appellant) (Respondent) PAN No. AACCV1786F Assessee by : Shri Parna Dutta, AR Revenue by : Shri Ashwani Kr. Singal, DR Date of hearing: 08.07.2025 Date of pronouncement: 18.07.2025 O R D E R Per Pradip Kumar Choubey, JM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(E)”] dated 04.02.2025 for A.Y. 2011-12.

2.

The brief fact of the case is that the assessee has filed its return of income for the A.Y. 2011-12 was showing loss. On the basis of information received from DDIT, Unit-1, Kolkata, the case of the assessee was reopened. Accordingly, notice u/s 148 of the Income-tax Act, 1961 (the Act) was issued. The ld. AR of the assessee made compliance and filed the written submission and also filed fresh return of income showing loss. Subsequently, notice u/s 143(3) of the Act was issued and notice u/s 142(1) of the Act along with questionnaire was

3.

Being aggrieved and dissatisfied, the assessee has preferred the appeal before us.

4.

The ld. AR instead of arguing into the merits of the case has to give an opportunity to place his case before the ld. CIT (A) as the order passed by the ld. CIT (A) is an ex-parte order. The ld. AR has filed an affidavit and indicates that the proper compliance shall be made from the side of the assessee, if the appeal of the assessee is restored back to the file of the ld. CIT (A).

5.

The ld. DR did not raise any objection.

“BEFORE THE NOTARY PUBLIC AFFIDAVIT 1, SHAMSHER ALAM, son of KAMRUDDIN, aged 58 years, by religion Muslim, resident of Koirpurawa, Ward-28, Buxar, Bihar, PIN-802101, do hereby solemnly affirm and state as follows-

1. 1. That I am one of the directors of M/s Vivid Colors Private Limited, hereinafter referred to as the "assessee" and, as such, I am competent to swear this affidavit on behalf of the said company.

2. That an appeal relating to A.Y.2011-12 was filed before the Ld. CIT(A), NFAC on 31.01.2019 against the assessment order dated 29.12.2018 u/s 147 r.w.s 144 of the Income Tax Act.

3. That the said appeal was dismissed by the Ld. CIT(A) by passing an ex- parte order on 04.02.2025 due to non compliance of anyone on assessee's behalf 4. That initially compliance could not be made since the assessee's office was not functioning due to covid. Thereafter, the accountant of the assessee-company who was entrusted with the task of accessing emails was not regularly attending office due to his ill health. As such, most of the notices skipped his attention.

5. That later on, on or around 25.02.2025 when I enquired the status of the appeal from my accountant and thereupon the said order was located in the Income Tax Portal which was already passed on 04.02.2025.

6. That then I immediately sought an appointment of Advocate Siddharth Agarwal of 1. Gibson Lane, Kolkata 700069 for filing an appeal before the Hon'ble Tribunal and handed over him all the relevant documents.

7. That the office of the said counsel prepared the appeal and finally the same was filed on 10.03.2025.

8. I give an undertaking that proper compliance shall be made from our end in case the matter is restored back to the file of lower authorities.

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