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Facts
The assessee appealed against an ex-parte order of the Ld. CIT(A) dated 23/02/2024, which arose from an assessment order by the Ld. AO under section 143(3) dated 13/09/2021. The core grievance was the denial of adequate opportunity of being heard, alongside challenges to additions for a loan under section 68, disallowance of interest under section 24(b), and unexplained investment under section 69 of the Income Tax Act, 1961.
Held
The Tribunal acknowledged that the CIT(A) had provided several opportunities, which the assessee failed to utilize. However, considering the various additions and disallowances made by the AO, the Tribunal decided that the assessee should be granted one final opportunity to be heard. Consequently, the matter was restored to the Ld. CIT(A) for a fresh adjudication in accordance with the law.
Key Issues
Denial of adequate opportunity of being heard by the CIT(A) and the validity of additions made under Section 68 (loan), Section 24(b) (interest disallowance), and Section 69 (unexplained investment).
Sections Cited
Section 143(3), Section 68, Section 24(b), Section 69, Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘G’: NEW DELHI
This appeal of the Assessee arises out of the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) Delhi, [hereinafter referred to as ‘Ld. CIT(A)’] dated 23/02/2024 against the order passed by Income Tax Officer, (hereinafter referred to as the ‘Ld. AO’) u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) on 13/09/2021.
The assessee has raised the following grounds of appeal:-
“1. Because the action for initiation, continuation and conclusion of assessment proceedings u/s 143(3) at an amount of Rs.2,61,32,200/- is being challenged on facts and law.
2. Because the action of CIT(A)-NFAC is being challenged on facts and law for not providing reasonable opportunity of being heard. The assessment order being passed is in violation of the principle of natural justice and without giving adequate time and opportunity to the appellant to present the case.
Because the action for addition of loan received amounting Rs.1,00,000/- u/s 68 of the Act is being challenged on facts and law while all parameters for the provision of law required by assessee fulfilled as revealed in findings from acquiescence by silence.
4. Because the action is being challenged on facts and law for making disallowance of interest u/s 24(b) of the Act amounting Rs. 10,96,358/- whereas per assessee interest u/s 24(b) is allowable on accrual basis and not on payment basis.
Because the action for addition of unexplained investment amounting Rs. 2,40,00,000/- u/s 69 of the Act is being challenged on facts and law overlooking the submissions filed by assessee on various dates.
6. Because the action for addition of unexplained investment amounting Rs. 2,40,00,000/-u/s 69 of the Act is being challenged on facts and law while all parameters for the provision of law required by assessee fulfilled.
Because the action is being challenged since the addition of unexplained investment amounting Rs. 2,40,00,000/- u/s 69 of the Act has been made without making proper investigation from the other parties whereby assessee has discharged the onus by providing all relevant documents.
For any consequential relief and/or legal claim arising out of this appeal and for any addition, deletion, amendment and modification in the grounds of appeal
before the disposal of the same in the interest of substantial justice to the assessee.”
3. At the time of hearing, the Ld. Counsel for the assessee submitted that Ld. CIT(A) passed ex parte order without providing adequate opportunity of being heard to the assessee, therefore, considering the additions/disallowance made by the Assessing Officer, the Ld. Counsel for the assessee prayed that the matter may be restored to the file of the Ld. CIT(A).
The Ld. Departmental Representative (DR) has no objection in remitting the matter back to the file of the Ld. CIT(A).
5. Considered the rival submissions and material placed on record, on a perusal of the Ld. CIT(A) order, we find that even though the Ld.CIT(A) provided opportunity on several occasions assessee could not appear or utilized the opportunities. Considering the totality of facts and submissions of the Ld. AR and keeping in view the additions/disallowance made by the Assessing Officer, we are of the opinion that assessee should be given one more opportunity of being heard. Hence, the matter is restored to the file of file of Ld. CIT(A) for de novo adjudication in accordance with law.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 22nd August, 2024.