PRAMOD PANDAY,NEW DELHI vs. DCIT, CENTRAL CIRCLE-19, NEW DELHI

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ITA 4065/DEL/2018Status: DisposedITAT Delhi09 October 2018AY 2013-143 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A) dismissed the appeal ex parte without discussing the merits and without substantiating non-compliance or lack of reasonable cause for adjournment. The principles of natural justice require the assessee to be heard.

What were the facts?

The assessee's appeal was dismissed ex parte by the CIT(A) for non-prosecution. The Assessing Officer had made an addition of Rs. 5,00,000/- under Section 2(22)(e) of the Income Tax Act.

What were the issues?

Whether the CIT(A) erred in passing an ex parte order without providing a reasonable opportunity of being heard to the assessee.

Which sections of the Income-tax Act were involved?

Section 2(22)(e)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Delhi Bench “SMC”, New Delhi

Before: SHRI N.K. SAINI

O R D E R N.K. SAINI, A.M:

This is an appeal by the assessee against the order dated 21.03.2018 of the learned CIT(A)-27, New Delhi. During the course of hearing, nobody was present on behalf of the assessee. Neither any adjournment was sought, I, therefore, proceeded ex parte and the appeal is decided after hearing the learned Sr. DR. 2. Following grounds have been raised in this appeal:-

“1. The CIT(A) ought to have not passed the order “ex parte”. 2. The addition of Rs. 5,00,000/- u/s 2(22)(e) of the Act is wrong and is opposed to evidences on record. 3. The transactions of Rs. 5,00,000/- alleged to be dividend u/s 2(22)(e) of the Act, being transactions entered into in the course of business and for the purposes of business, the provisions of section 2(22)(e) of the Act are not applicable at all.

2.

Vide ground no. 1, the grievance of the assessee relates to the ex parte order passed by the learned CIT(A). Facts of the case in brief are that the assessee filed return of income on 31.7.2013 declaring an income of Rs. 30,82,910/-. Later on the case was selected for scrutiny. The AO made the addition of Rs. 5,00,000/- by making the disallowance u/s 2(22)(e) of the Income Tax Act (hereinafter referred to as the ‘Act). Being aggrieved the assessee carried the matter to the learned CIT(A) who dismissed the appeal ex parte for want of prosecution. 4. Now the assessee is in appeal. 5. The learned Sr. DR supported the orders of the authorities below. In the present case, it is noticed that the learned CIT(A) dismissed the appeal of the assessee ex parte for non prosecution without discussing the case on merit. He simply stated that the notices issued for fixing the dates of hearing were either not complied with or adjournments were sought by the assessee by making excuses. However, nothing is brought on record to substantiate that there was no reasonable cause while seeking the adjournment. It is also not brought on record as to whether the notices issued were served upon the assessee. It is well settled that nobody should be condemned unheard as per the maxim “Audi Alteram Partem”. I, therefore, by keeping in view the principles of natural justice remit this case back to the file of the learned CIT(A) to be decided afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee. 7. In the result, appeal of the assessee is allowed for statistical purposes.

(Order pronounced in the open court on 09.10.2018.)

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