TECHMOBIA DIGITAL SOLUTION PVT. LTD.,NEW DELHI vs. DCIT, NEW DELHI

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ITA 2979/DEL/2015Status: DisposedITAT Delhi19 June 2018AY 2008-094 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the issue to the CIT(A) to grant one final opportunity to the assessee to substantiate its case, considering the interest of justice and the fact that notices were only sent twice by speed post.

What were the facts?

The assessee's appeal against an ex-parte order confirming a penalty was heard. The assessee did not appear, and the appeal was decided based on available records and the Ld. DR's arguments.

What were the issues?

Whether the penalty levied under Section 271(1)(c) was sustainable when the assessee was not given adequate opportunity to present its case before the CIT(A).

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘G’, NEW DELHI

Before: SH. R. K. PANDA & MS. SUCHITRA KAMBLE

Hearing: 18/06/2018Pronounced: 19/06/2018

This appeal filed by the assessee is directed against the ex-parte order dated 03.02.2015 passed by Ld. CIT (A)-19, New Delhi relating to A. Y. 2008-09.

2.

None appeared on behalf of the assessee at the time of hearing. Therefore, the appeal is being decided on the basis of material available on record and after hearing the Ld. DR.

3.

Although a number of grounds have been raised by the assessee, however, they all relate to the order of the CIT (A) in confirming the penalty of Rs.10,98,069/- levied by the Assessing Officer u/s 271 (1) (c) of the IT Act.

4.

After hearing the Ld. DR and on perusal of the orders of the authorities below, we find the assessee is a company engaged in the business of SMS services. It filed its return of income on 29.09.2008 declaring total income of Rs.92,60,844/-. The Assessing Officer completed the assessment u/s. 143 (3) determining the total income at Rs. 1,29,11,840/- wherein he made the following three additions totalling to Rs.30,51,040/-.

(i) Set up fee : Rs.26,71,040/- (ii) Earnest money written off : Rs.3,50,000/- (iii) Security written off : Rs.30,000/-

5.

The appeal filed by the assessee was dismissed by the CIT (A) in the quantum proceedings. The Assessing Officer thereafter initiated penalty proceedings u/s. 271 (1) (c) of the IT Act. Rejecting the explanation given by the assessee and relying on various decisions, the Assessing Officer levied penalty of Rs.10,98,069/- u/s. 271 (1 ) (c) of the IT Act being 100% of the tax sought to be evaded. Since none appeared on behalf of the assessee, the Ld. CIT (A), in the ex-parte order passed by him, sustained the penalty levied by the Assessing Officer.

6.

A perusal of the order of the CIT (A) shows that notices were issued to the assessee only twice by speed post and there was non compliance for which the Ld. CIT (A) passed the ex-parte order confirming the penalty levied by the Assessing Officer.

7.

Considering the totality facts of the case and in the interest of justice we deem it proper to restore the issue to the file of the CIT (A) with a direction to grant one final opportunity to the assessee to substantiate its case. The assessee is also hereby directed to appear before the Ld. CIT (A) and substantiate his case failing which the Ld. CIT (A) is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

8.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 19.06.2018.

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