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Facts
The assessee appealed an ex-parte assessment order under Section 144 and a subsequent ex-parte CIT(A) order, claiming lack of awareness of proceedings and non-service of notices, which prevented the submission of documents. The assessee sought a fresh opportunity to plead their case, while the Revenue alleged negligence in their approach.
Held
The Tribunal found a violation of natural justice as the assessee was not given sufficient opportunity to be heard before the lower authorities. It set aside the CIT(A)'s order and remitted the matter to the Assessing Officer for a de novo adjudication, directing the AO to provide a fresh opportunity to the assessee. A cost of Rs. 2,000/- was imposed on the assessee for their non-compliance.
Key Issues
Whether the ex-parte assessment and appellate orders violated principles of natural justice due to lack of sufficient opportunity to the assessee to present their case.
Sections Cited
Section 144 of the Income Tax Act, 1961
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Income Tax Appellate Tribunal, “SMC”
Before: DR. ARJUN LAL SAINI
Appellant by : Shri Vimal Desai, Ld. AR Respondent by : Shri Abhimanyu Singh Yadav, Ld. , Ld. Sr. DR Date of Hearing : 02/09/2025 Date of Pronouncement of Pronouncement : 11/09/2025 ORDER Per,Dr. Arjun Lal Saini, Accountant Member: . Arjun Lal Saini, Accountant Member:
The present appeal has been filed by the Assessee, against the order passed The present appeal has been filed by the Assessee, against the order passed The present appeal has been filed by the Assessee, against the order passed by the Learned Commissioner of Income Tax (Appeal), National Faceless Appeal, by the Learned Commissioner of Income Tax (Appeal), National Faceless Appeal, by the Learned Commissioner of Income Tax (Appeal), National Faceless Appeal, Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] Delhi [hereinafter referred to as “CIT(A)”] dated dated 11.10.2024 arising in the matter of assessment order passed u/s. arising in the matter of assessment order passed u/s. 144 of the Income Tax Act, of the Income Tax Act, 1961 (here-in-after referred to as “the Act”) relevant to the Assessment Year 20 after referred to as “the Act”) relevant to the Assessment Year 2017- after referred to as “the Act”) relevant to the Assessment Year 20 18. 2.At the outset itself, the ld. Counsel for the assessee 2.At the outset itself, the ld. Counsel for the assessee assailed the impugned order assailed the impugned order by contending that the assessee could not represent his case before Ld. CIT(A) and by contending that the assessee could not represent his case before Ld. CIT(A) and by contending that the assessee could not represent his case before Ld. CIT(A) and Rashiklal M. Patel the order being an ex-parte order, stood vitiated on account of violation of parte order, stood vitiated on account of violation of parte order, stood vitiated on account of violation of principle of natural justice. f natural justice. The Ld. Counsel for the assessee submitted that the Ld. Counsel for the assessee submitted that the assessee was not aware about the faceless proceedings/ Income Tax Act assessee was not aware about the faceless proceedings/ Income Tax Act assessee was not aware about the faceless proceedings/ Income Tax Act proceedings and not aware about notices during the assessment proceedings and not aware about notices during the assessment proceedings proceedings which were not served on the assessee, therefor were not served on the assessee, therefore, assessee could not submit e, assessee could not submit entire documents and evidences before the assessing officer. On appeal, by the assessee documents and evidences before the assessing officer. On appeal, by the assessee documents and evidences before the assessing officer. On appeal, by the assessee before the Ld. CIT(A), the advocate of the assessee committed mistake and did not before the Ld. CIT(A), the advocate of the assessee committed mistake and did not before the Ld. CIT(A), the advocate of the assessee committed mistake and did not file the required documents and ed documents and evidences. The Ld. Counsel submitted that now Ld. Counsel submitted that now assessee is ready with entire ready with entire documents and evidences which are to be submitted to be submitted before the Lower Authorities, therefore, Ld. Counsel contended that one more before the Lower Authorities, therefore, Ld. Counsel contended that one more before the Lower Authorities, therefore, Ld. Counsel contended that one more opportunity may be given to the asse opportunity may be given to the assessee to plead his case before the assessing ssee to plead his case before the assessing officer for fresh adjudication. for fresh adjudication.
On the other hand, the ld. DR for the Revenue he ld. DR for the Revenue submitted that the assessee was that the assessee was totally negligent in his approach and neither appeared before the assessing officer totally negligent in his approach and neither appeared before the assessing officer totally negligent in his approach and neither appeared before the assessing officer not before the Ld. CIT(A), hence, heavy Ld. CIT(A), hence, heavy cost should be imposed to the assessee on cost should be imposed to the assessee on account of non compliances attitude account of non compliances attitude, if the Bench wants to remit the issue back to the issue back to the file of the assessing officer assessing officer.
I have heard both the parties and carefully gone through the submission put forth have heard both the parties and carefully gone through the submission put forth have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws on behalf of the assessee along with the documents furnished and the case laws on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld relied upon, and perused the fact of the case including the findings of the ld relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. materials brought on record. I note that in the assessee’s case note that in the assessee’s case under consideration, the assessment was carried out u/s under consideration, the assessment was carried out u/s 144 of the Act and the of the Act and the impugned order passed by the ld. CIT(A), is an ex parte order and non impugned order passed by the ld. CIT(A), is an ex parte order and non-speaking impugned order passed by the ld. CIT(A), is an ex parte order and non order, therefore, I do not wish to do not wish to make any comments on the merits of the grounds make any comments on the merits of the grounds raised by the assessee. 2
Considering the above facts, Considering the above facts, I note that assessee has not given sufficient note that assessee has not given sufficient opportunity of being heard and could not plead his case successfully before the ld. opportunity of being heard and could not plead his case successfully before the ld. opportunity of being heard and could not plead his case successfully before the ld. CIT(A). I note that the ld. CIT(A) did not discuss the assessee’s case on merits note that the ld. CIT(A) did not discuss the assessee’s case on merits note that the ld. CIT(A) did not discuss the assessee’s case on merits based on the material available before him hence it is a violation of principle of based on the material available before him hence it is a violation of principle of based on the material available before him hence it is a violation of principle of natural justice. I note that it is settled law that principles of natural justice and fair t is settled law that principles of natural justice and fair t is settled law that principles of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard re that the affected party is granted sufficient opportunity of being heard re that the affected party is granted sufficient opportunity of being heard to contest his case. However, on account of non However, on account of non-compliance attitude of the compliance attitude of the assessee, I imposed a cost of Rs. cost of Rs. 2,000/- on the assessee which should be deposited on the assessee which should be deposited in the Prime Minister National Relief Fund. National Relief Fund. Therefore, without delving much without delving much deeper into the merits of the case, in the interest of justice, deeper into the merits of the case, in the interest of justice, I restore the matter back restore the matter back to the file of assessing officer assessing officer for de novo adjudication and pass a speaking order adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee, who in turn, is after affording sufficient opportunity of being heard to the assessee, who in turn, is after affording sufficient opportunity of being heard to the assessee, who in turn, is also directed to contest his stand forthwith. also directed to contest his stand forthwith. For the reasons given above, For the reasons given above, I am of the view that the order of the CIT(A) on this the view that the order of the CIT(A) on this issue requires to be set aside and the issue requires to be set aside and the issue needs to be looked into afresh by the be looked into afresh by the assessing officer in the light of the in the light of the observations as set out above. observations as set out above. I hold and direct accordingly. The assessing officer assessing officer will afford opportunity of being heard to the Asse will afford opportunity of being heard to the Assessee before deciding the issue. ssee before deciding the issue. The Assessee will also be at liberty to let in further evidence to substantiate its The Assessee will also be at liberty to let in further evidence to substantiate its The Assessee will also be at liberty to let in further evidence to substantiate its is treated as allowed. case. For statistical purpose, the appeal of the assessee purpose, the appeal of the assessee is treated as allowed.
In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for statistical purposes statistical purposes Order is pronounced in the open court on Order is pronounced in the open court on 11/09/2025.