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Facts
The Assessing Officer made ex-parte additions of Rs.3,73,162/- for net profit at 8% of total turnover and Rs.46,90,000/- and Rs.90,85,000/- for unexplained cash credits under section 68 of the Income-tax Act, 1961. The CIT(A) confirmed these additions by also dismissing the assessee's appeal ex-parte, leading the assessee to appeal before the ITAT.
Held
The Tribunal remitted the issue back to the file of the Assessing Officer, directing them to pass a fresh order as per law after providing the assessee with a proper opportunity of being heard. This decision was based on the assessee's counsel citing genuine reasons for prior non-appearance, which the ld. DR for Revenue did not object to.
Key Issues
Whether the CIT(A) erred in dismissing the appeal ex-parte without adjudicating on merits, leading to confirmation of additions for net profit and unexplained cash credits, and whether the matter should be remitted for a fresh opportunity of hearing.
Sections Cited
Section 68 of Income-tax Act, 1961, Section 145 of Income-tax Act, 1961
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Income Tax Appellate Tribunal, DELHI BENCH ‘F’ : NEW DELHI
Before: SHRI SHAMIM YAHYA & SHRI VIMAL KUMAR
Order
: 26.07.2024 ORDER
PER SHAMIM YAHYA, ACCOUNTANT MEMBER
This appeal by the assessee is directed against the order of the ld. CIT (Appeals)/National Faceless Appeal Centre (NFAC) dated 27.03.2024 for the assessment year 2017-18.
Grounds of appeal
taken by the assessee read as under :- “1. On the facts and circumstances of the case and in law, the order passed by CIT (A) is against the principles of natural justice.
2. On the facts and circumstances of the case and in law, the CIT (A) erred in not adjudicating the grounds of appeal on merit.
3. On the facts and circumstances of the case and in law, the CIT (A) erred in passing ex-parte order.
4. On the facts and circumstances of the case and in law, the assessment order passed by Ld. Assessing Officer is bad-in-law and CIT(A) erred in not holding so.
5 On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the assessing officer of Rs.3,73,162/- on the account of net profit @ 8% of total turnover, and therefore, the addition made by the AO is liable to be deleted 6 On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the assessing officer of Rs.46,90,000/- on the account of alleged unexplained cash credit u/s 68 of the Act. and, therefore, the addition made by the AO is liable to be deleted.
7 On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the assessing officer of Rs.90,85,000/- on the account of alleged unexplained cash credit u/s 68 of the Act, and, therefore, the addition made by the AO is liable to be deleted.
8 On the facts and circumstances of the case and in law, the assessing officer erred in rejecting in the books of account by invoking provisions of section 145 of the Act and CIT (A) erred in not holding so.”
Brief facts of the case are that in this case, Assessing Officer in an ex- parte order made additions on account of net profit @ 8% of total turnover of Rs.3,73,162/- and alleged unexplained cash credit u/s 68 of the Income- tax Act, 1961 of Rs.46,90,000/- & Rs.90,85,000/-.
Upon assessee’s appeal, ld. CIT (A) also confirmed the order of the AO by dismissing the appeal ex-parte. 5. Against this order, assessee is in appeal before the ITAT. We have heard both the parties and perused the records.
Ld. Counsel for the assessee prayed that there were genuine reasons for non-appearance of the assessee before the authorities below. He prayed that an opportunity may be granted to the assessee to canvass the case properly. He also undertook that he will appear before the authorities below.
Ld. DR for the Revenue did not have any serious objection to this proposition. 8. Accordingly, in the interest of justice, we remit the issue to the file of AO. AO is directed to pass an order as per law after giving the assessee proper opportunity of being heard. 9. In the result, the appeal of the assessee stands allowed for statistical purposes. Order pronounced in the open court on this 26th day of July, 2024.