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Facts
The assessee, Wamika Hospitality Pvt. Ltd., did not file its original ITR for AY 2018-19. After reopening under Section 147, it filed a return. The AO initiated penalty proceedings under Section 271DA for cash deposits of Rs. 8.86 crore, alleging contravention of Section 269ST. The CIT(A) upheld the penalty through an ex-parte order, as notices were allegedly not received by the assessee in due time.
Held
The Tribunal observed that the CIT(A) passed the ex-parte order due to non-appearance by the assessee, which was attributed to notice delivery issues to a former CA/accountant. Considering that the assessee was not given a proper opportunity of being heard, the Tribunal deemed it expedient to restore the matter to the CIT(A) for a fresh decision in accordance with law.
Key Issues
Whether the CIT(A) erred in confirming the penalty under Section 271DA via an ex-parte order without providing adequate opportunity of being heard to the assessee.
Sections Cited
Section 271DA, Section 147, Section 148, Section 144B, Section 269ST
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘F’ NEW DELHI
Before: SHRI PRADIP KUMAR KEDIA & SHRI VIMAL KUMAR
(Assessment Year : 2018-19) Wamika Hospitality Pvt. Vs. ITO Ltd. Ward – 27(1), C-94, Ring Road, Wazirpur Delhi – 110 092 Industrial Area, Delhi-110 052 PAN : AABCW 0005 F (Appellant) (Respondent) Assessee by Shri Ruchesh Sinha, Adv. and Ms. Monalisa, Adv. Respondent by Ms. Harpreet Kaur Hansra, Sr. D.R. Date of Hearing 10.12.2024 Date of Pronouncement 13.12.2024 O R D E R PER VIMAL KUMAR, JM:
The appeal filed by assessee is against the order dated 14.05.2024 of Learned Commissioner of Income Tax (Appeals)- NFAC, Delhi [hereinafter referred to as ‘Ld. CIT(A)’] arising out of penalty order dated 29.09.2023 by the NeAC, Delhi (hereinafter referred as ‘Ld.AO’) under section 271DA of the Income Tax Act,
Brief facts leading to this case is this that the appellant/assessee company did not file its original return of income for the A.Y. 2018-19. As per information with the Department, the assessee deposited cash to the tune of Rs.8,86,49,000/-. The case was reopened under section 147 of the Act and notice under section 148 of the Act was issued on 31.03.2022. In response to notice, assessee filed return for A.Y. 2018-19 declaring an income of Rs.1,47,680/-. The assessment order under section 147 r.w.s 144B of the Act was passed on 27.03.2023 by accepting return income of Rs.1,47,680/-.
During the course of assessment proceedings, assessee stated that the cash of Rs.8,86,49,000/- was out of business receipts. The total turnover of the company during the year was Rs.13,58,61,751/-. In the assessment order, learned AO found that assessee has taken cash receipts in contravention of the provision of section 269ST of the Act. Penalty proceedings were initiated. Assessee submitted submissions on 24.09.2023. Learned AO concluded penalty proceedings vide order dated 29.09.2023.
Appellant/assessee preferred appeal before the learned CIT(A) which was dismissed in part vide order dated 14.05.2024.
Wamika Hospitality Pvt. Ltd. vs. ITO A.Y. 2018-19 5. Being aggrieved, appellant/assessee preferred present appeal before the Tribunal.
Learned Authorized Representative for the assessee/appellant at the time of hearing submitted that learned CIT(A) upheld the penalty order dated 29.09.2023. The learned CIT(A) had issued notices for hearing dated 30.03.2024, 29.02.2024 and 10.01.2024 which were not received by the assessee in the due time and hence, assessee was unable to file any reply or appear and present the case. The notices were sent to the E-mail ID of Mr. Akash Verma (CA) who was handing the matter and did not inform the assessee. Mr. Harish Mehta, Accountant of company dealing with the accounts and coordinating with CA Mr. Akash Verma had put his mail ID on the portal for any communication. After resignation of Mr. Mehta, (Accountant) nobody got information about the notices. Learned CIT(A) confirmed the penalty order without giving any proper opportunity of being heard to the assessee.
Learned Departmental Representative of the Department of Revenue submitted that despite repeated notices, appellant/assessee had failed to appear before the learned CIT(A).
From examination of record in light of aforesaid rival contentions, it is crystal clear that learned CIT(A) vide ex-parte order dated 14.05.2024 upheld the penalty order dated 29.09.2023.
Wamika Hospitality Pvt. Ltd. vs. ITO A.Y. 2018-19 Learned CIT(A) had passed ex parte order since appellant/ assessee failed to appear despite several notices. In view of the above material facts and interest of justice, it is considered expedient to restore the matter to the file of the learned CIT(A) for fresh decision in accordance with law.
In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced on this day 13th December, 2024