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Facts
The assessment for AY 2013-14 was completed ex-parte under Section 144, leading to additions of Rs. 12,62,000 for cash credit under Section 68 and Rs. 33,18,000 for disallowance of expenditure under Section 40A(ia) due to non-deduction of TDS under Section 194H. The CIT(A) confirmed these additions as the assessee failed to prove creditor identity and applicability of Section 194H exemptions. The assessee contended they were not properly represented before the lower authorities.
Held
The Tribunal noted the assessee's non-participation in assessment proceedings and lack of proper representation. In the interest of justice, without commenting on the merits, the Tribunal set aside the impugned order and remanded the case back to the Assessing Officer for a de novo assessment. The AO is directed to provide the assessee a reasonable opportunity to furnish fresh evidence and make submissions.
Key Issues
Ex-parte assessment for non-compliance; Addition of cash credit; Disallowance of expenditure for non-deduction of TDS on commission; Opportunity for the assessee to present evidence.
Sections Cited
Section 144, Section 143(2), Section 142(1), Section 68, Section 40A(ia), Section 194H
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Income Tax Appellate Tribunal, DELHI BENCH “F”, DELHI
ORDER
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)–I, Noida [in short ‘the CIT(A)’] dated 31.03.2018, for assessment year 2013-14.
A perusal of appeal file shows that assessment order has been passed u/s. 144 of the Income Tax Act, 1961(hereinafter referred to as ‘the Act’). The Assessing Officer (AO) had issued notice u/s. 143(2) of the Act to the assessee on 04.09.2014. In response to the notice Shri Praveen Mittal, Karta attended on 12.06.2015 and sought adjournment. On the request of assessee the case was adjourned to 07.07.2015. On the said date no one attended the proceedings on behalf of the assessee. The AO adjourned the proceedings to next date and issued notice u/s. 142(1) of the Act. There was no compliance of notices issued by the AO, thereafter. The Assessing Officer was constrained to invoked the provisions of Section 144 of the Act and completed the assessment vide order dated 21.03.2016.
The AO made addition on following counts: i. Addition u/s. 68 of the Act; disallowance of cash credit Rs. 12,62,000/- ;and ii. Disallowance of claim of expenditure u/s. 40a(ia) of the Act on account of non deduction of tax at source Rs. 33,18,000/-. 4. Aggrieved, against the assessment order the assessee filed appeal before the CIT(A). Even before the First Appellate Authority the assessee failed to make out a case and discharge its onus in proving identity of the creditors. The assessee further failed to demonstrate that the provisions u/s. 194H of the Act are not attracted on the payment of commission. Consequently, the CIT(A) confirmed the additions and dismissed the appeal of the assessee. 5. Shri R.S. Singhvi appearing on behalf of the assessee submitted that the assessee is a HUF. The assessee is a small time trader of SIM cards and recharge of SIMS. The assessee was not properly represented either before the CIT(A) or the