M/S. MANGALSHREE SALES LTD., ,KOLKATA vs. ITO, WARD - 9(1), , KOLKATA

Per Shri A.T.Varkey, JM

3. After hearing both the sides we note that the Ld. CIT(A) has passed the impugned order ex parte though the Ld. CIT(A) has recorded that he has sent the notice on 02.01.2018. However, from a perusal of the cause title of the impugned order shows that date of hearing has been mentioned as 15.12.2017 and 02.01.2018. In such circumstances, the Ld. AR wondered as to how the Ld. CIT(A) states that the notice was issued on 02.01.2018 when

2 Jha Educational Trust, AY: 2009-10 the hearing was fixed on 02.01.2018 and has passed the impugned order on 10.01.2018 which shows that per se there was no effective hearing before the Ld. CIT(A). We note that Ld. CIT(A) has mentioned two dates of hearing i.e. on 15.12.2017 and 02.01.2018 and has stated that notice was issued on 02.01.2018. However, the Ld. CIT(A) failed to mention when was the last date of hearing fixed for the appeal to be heard by the Ld. CIT(A). Since the Ld. CIT(A) has not spelled out the last date of hearing before him, which cannot obviously be 02.01.2018, since it has been recorded by Ld. CIT(A) that notice was issued on 02.01.2018. So, without mentioning the last date of hearing the Ld. CIT(A) erred in finding that “no one attended in response to the notices”. So, we find force in the contention of the Ld. AR on this score. Moreover, it was brought to our notice that the AO had issued notice u/s. 133(6) of the Act to the share subscribers which were properly complied with by the respective share subscribers. However, since summons u/s. 131 could not be complied with, the AO has made the addition. The Ld. AR submitted that at that particular point of time since the director was not present in station, they could not appear before the AO. Given a chance, the Ld. AR undertakes to produce the director before the AO. According to the Ld. Counsel since no proper opportunity the assessee got at the assessment stage and also at the appellate stage he relying on the decision of the Hon’ble Supreme Court in the case of Tin Box Company Vs. CIT (2001) 249 ITR 216 (SC) the Ld. AR pleaded that the issue to be remanded back to AO for fresh/ de novo assessment. We note from the aforesaid discussion it is discerned that no proper opportunity was given to the assessee at the assessment stage also. We note that in the case of Tin Box (supra) the Hon’ble Supreme Court held as under: “It is unnecessary to go into great detail in these matters for there is a statement in the order of the Tribunal, the fact-finding authority, that reads thus: “We will straightaway agree with the assessee’s submission that the Income-tax Officer had not given to the assessee proper opportunity of being heard.” That the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is the assessment order that counts. That order must be made after the assessee has been given a reasonable opportunity of setting out his case. We, therefore, do not agree with the Tribunal and the High Court that it was not necessary to set aside the order of assessment and remand the matter to the assessing authority for fresh assessment after giving to the assessee a proper opportunity of being heard.

3 Jha Educational Trust, AY: 2009-10 Two questions were placed before the High Court, of which the second question is not pressed. The first question reads thus: “1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in not setting aside the assessment order in spite of a finding arrived at by it that the Income-tax Officer had not given a proper opportunity of hearing to the assessee?” In our opinion, there can only be one answer to this question which is inherent in the question itself: in the negative and in favour of the assessee. The appeals are allowed. The order under challenge is set aside. The assessment order, that of the Commissioner (Appeals) and of the Tribunal are also set aside. The matter shall now be remanded to the assessing authority for fresh consideration, as aforestated.”