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Facts
The assessee's appeal for AY 2017-18 was directed against the order of the Ld. CIT(A) which arose from an order u/s 144 of the Income Tax Act. The assessee contended that the order was ex-parte due to non-service of hearing notices and violation of natural justice, and that the Ld. CIT(A) dismissed the appeal for non-payment of advance tax, despite the assessee being an agriculturist with exempt income.
Held
The Tribunal noted that the Ld. CIT(A)'s order was non-speaking and did not address the merits of the case. The assessee was not afforded sufficient opportunity to be heard, violating the principles of natural justice. As the assessee is an agriculturist, advance tax was not payable on exempt income.
Key Issues
Whether the ex-parte order passed by the Ld. CIT(A) for non-payment of advance tax is sustainable when the assessee is an agriculturist and the principles of natural justice were violated?
Sections Cited
144
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RAJKOT BENCH(SMC
Before: DR. ARJUN LAL SAINI, AM
O R D E R Dr. ARJUNLAL SAINI AM; Captioned appeal filed by the assessee, pertaining to Assessment Year 2017-18, is directed against the order passed by Learned Commissioner of Income-tax (Appeals) / National Faceless Appeal Centre (NFAC), Delhi [in short “the Ld.CIT(A)”] vide order dated 28.12.2023, which in turn arises out of an order passed by the Assessing Officer, dated 15.10.2019, u/s 144 of the Income Tax Act, 1961 (in short “the Act”).
At the outset itself, the ld. Counsel for the assessee assailed the impugned order by contending that the assessee could not represent his case before Ld. CIT(A) and the order being an ex-parte order, stood vitiated on account of violation of principle of natural justice. During the appellate proceedings, the notices of hearing were not served on the assessee. The ld. Counsel for the A.Y 17-18 Bharatbhai Der assessee, also submitted that ld. CIT(A) dismissed the appeal of the assessee, simply on the reason that assessee did not pay the advance tax, however, the assessee is an agriculturalist, whose income is exempted from tax, therefore, he need not to deposit the advance tax.
On the other hand, the Learned Senior DR for the Revenue, argued that there is a non-compliance on the part of the assessee, before the Assessing Officer as well as before the ld. CIT(A), during the appellate proceedings, therefore, it is just wasting the time and resources of the lower authorities, if the matter is remitted back to the file of the lower authorities. Therefore, appeal of the assessee should be dismissed at this stage only.
I have heard both the parties. I note that in the assessee’s case under consideration, the assessment was carried out u/s 144 of the Act, and the impugned order passed by the ld. CIT(A), is non-speaking order, therefore, I do not wish to make any comments on the merits of the grounds raised
by the assessee. Considering the above facts, I note that assessee has not given sufficient 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 based on the material available before him hence it is a violation of principle of natural justice. The Assessee is an agriculturalist, therefore, he need not to pay the advance tax on his exempted income. I note that it is settled law that principles of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard to contest his case. Therefore, without delving much deeper into the merits of the case, in the interest of justice, I restore the matter back to the file of Assessing Officer for de novo adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee, who in turn, is also directed to contest his stand A.Y 17
18. Bharatbhai Der forthwith. Therefore, I deem it fit and proper to set aside the order of the ld. CIT(A) and remit the matter back to the file of the Assessing Officer to adjudicate the issue afresh on merits. For statistical purposes, the appeal of the assessee is treated as allowed.
In the result, the appeal of the assessee is allowed for statistical purposes.