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Facts
The assessee, AST Engineers Pvt. Ltd., appealed against the CIT(A)'s order confirming the disallowance of Rs. 14,33,264/- as finance cost/interest paid for Assessment Year 2016-17. The CIT(A) had confirmed the disallowance, noting that the assessee made no submissions and failed to prosecute the appeal, thereby upholding the Assessing Officer's addition.
Held
The Tribunal observed that the assessee contended its submissions to the AO were overlooked and it was denied proper opportunity by the CIT(A). Considering these points and the lack of opposition from the Revenue, the Tribunal remitted the case back to the Assessing Officer. The AO is instructed to re-examine the issue and pass a fresh order after affording the assessee a proper hearing.
Key Issues
Whether the disallowance of finance cost/interest paid was correctly confirmed by the CIT(A) without providing proper opportunity to the assessee, and whether principles of natural justice were violated.
Sections Cited
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ : NEW DELHI
Order : 25.07.2024 ORDER This appeal by the assessee is directed against the order of the ld. CIT (Appeals)/National Faceless Appeal Centre (NFAC) dated 29.02.2024 for the assessment year 2016-17. 2. Grounds of appeal
taken by the assessee read as under :- “1. Ld. Addl/JCIT has erred in totally ignoring the submissions made by the assessee from the time to time both manually and electronically and thus violated the principles of natural justice. He has wrongly stated that no reply has ever been filled by the assessee during appellate proceedings and as such order passed by him is perverse.
2. Ld. Addl/JCIT has erred in confirming the disallowance of finance cost of Rs.14,33,264/- without properly considering the facts of the case.”
3. In this case, Assessing Officer made addition on account of disallowance of interest paid amounting to Rs.14,33,264/-.
4. Upon assessee’s appeal, ld. CIT (A) noted that assessee has not made any submission. He observed that assessee is not interest in prosecuting the appeal. He referred to AO’s order and confirmed the same.
5. Against this order, assessee is in appeal before the ITAT. I have heard both the parties and perused the records. 6. Ld. Counsel for the assessee prayed that assessee has made various submissions before the AO which have not been considered. He further prayed that proper opportunity was not also provided at the level of ld. CIT (A). Hence, he prayed that an opportunity may be granted to the assessee to canvass the case properly. 7. Ld. DR for the Revenue did not oppose to this proposition. 8. Accordingly, in the interest of justice, I remit the issue to the file of AO. AO is directed to consider the issue afresh and pass an order afresh 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 25TH day of July, 2024.