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Facts
The assessee, Deepak Budhiraja, filed appeals against orders of the CIT(A), NFAC, which arose from assessments passed under sections 147/144 of the Income Tax Act, 1961. The assessments were based on incriminating material allegedly found during a search at a third party (Mastana Group) premises. The assessee argued that the assessments should have been completed under section 153C of the Act, and the CIT(A) dismissed the appeals ex parte as the assessee failed to appear, allegedly due to non-service of notices.
Held
The Tribunal noted that the CIT(A) had not conducted a factual appreciation or provided conclusive findings on the legal and factual issues, given the ex parte dismissal. Concluding that the ends of justice required a proper examination, the Tribunal restored the issues on merits and point of law to the CIT(A) for a fresh order after providing the assessee a reasonable opportunity of hearing.
Key Issues
Whether the assessment should have been completed under section 153C instead of sections 147/148 when incriminating material was found during a search on a third party. Whether the CIT(A) erred in dismissing the appeal ex parte without addressing the legal issues and factual aspects, especially when the assessee claimed non-service of notices.
Sections Cited
Section 147 of the Income Tax Act, 1961, Section 144 of the Income Tax Act, 1961, Section 148 of the Income Tax Act, 1961, Section 153C of the Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCHES : B : NEW DELHI
Before: SHRI M. BALAGANESH & SHRI ANUBHAV SHARMA
(Appellant) (Respondent) Assessee by : Shri V.K. Bindal, CA & Ms Rinky Sharma, ITP Revenue by : Shri Shyam Manohar Singh, Sr.DR Date of Hearing : 14.08.2024 Date of Pronouncement : 27.08.2024 ORDER PER ANUBHAV SHARMA, JM: These are appeals preferred by the assessee against the orders dated 07.02.2024 of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) arising out of the appeal before it against the orders passed u/s ITAs No.1473 to 1476/Del/2024 147/144 of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’), by the ITO, Ward48(4), New Delhi (‘the ld. AO’ for short).
Heard and perused the record.
At the time of hearing, the ld. counsel for the assessee had raised a legal argument that the assessment in the case of the assessee should have been completed by taking recourse to section 153C of the Act and the impugned notice u/s 148 and the assessment thereupon u/s 147 of the Act is not in accordance with law. He has argued that the incriminating material/entries were allegedly found during the search in the premises of Mastana Group on 17.01.2017 and the same has been relied for completing assessment in the hands of the assessee without taking recourse to section 153C of the Act. He had relied the decision of this bench itself in the case of Anoop Kumar Gupta Versus ACIT order dated 5/10/2023 and in MAH Impex (P) Ltd Versus ITO in order dated 31/10/2023.
The proposition as raised in no more res integra, however, what transpires form the impugned order is that before the CIT(A), the assessee had failed to appear and make any submissions on facts or law and proceeding the assessee ex parte, the CIT(A) had dismissed the appeal of the assessee. Though the appeal was dismissed in default, but, CIT(A) had made some observations on the merits of the addition also. But, the same was without examination of the legal issue as raised before us and not having an opportunity to consider the ITAs No.1473 to 1476/Del/2024 substantial facts and the legal aspects on submissions of assessee. The ld. counsel had pointed out that notices were not actually served upon the assessee.
We are of the considered view that as there is no factual appreciation and conclusive findings of the CIT(A) on questions of facts and law thus the ends of justice require restoring the issues on merits and point of law to CIT(A) for passing an order afresh.
Consequently, the appeals are allowed for statistical purposes and the issues on merits and question of law are restored to the files of the CIT(A) to pass an order afresh after giving a reasonable and effective opportunity of hearing to the assessee.