MOIZ SAIFUDDIN RAJKOTWALA,MUMBAI vs. DCIT RG 2)(2), MUMBAI

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ITA 236/MUM/2017Status: DisposedITAT Mumbai22 June 2018AY 2011-125 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the CIT(A)'s order was ex-parte and the assessee had not been properly heard. Therefore, the Tribunal decided to set aside the CIT(A)'s order and remand the matter back for fresh consideration.

What were the facts?

The assessee's appeal was directed against an ex-parte order passed by the CIT(A). The assessee contended that they were not afforded a reasonable opportunity of being heard during the appellate proceedings. Notices sent to the assessee were returned as unclaimed or undelivered.

What were the issues?

Whether the CIT(A) erred in passing an ex-parte order without affording a reasonable opportunity of being heard to the assessee. Whether the disallowances under Section 23(1)(a) and Section 14A were justified.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 23(1)(a),Section 14A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI “I” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY, HON’BLE & SHRI Dr. A.L. SAINI, HON’BLE

For Respondent: Shri Saurabhkumar Rai – DR
Hearing: 18/06/2018

Assessee by : None. Department By : Shri Saurabhkumar Rai – DR Date of hearing : 18/06/2018. Date of pronouncement : 22/06/2018. O R D E R PER Dr. A.L. SAINI, ACCOUNTANT MEMBER

The captioned appeal filed by the assessee pertaining to Assessment Year 2011-12, is directed against the order passed by the ld. CIT(A)-36, Mumbai in appeal No. CIT(A)-31/IT-90/DCIT- 20(2)/14-15, dated 21/10/2016, which in turn arises out of the assessment order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961 (for short, "Act"), dated 28/03/2014.

2.

The grievances raised by the assessee are as follows:- “1. Learned Commissioner of Income Tax (Appeals) erred in passing an Order without affording a reasonable opportunity of being heard to the Appellant. Appellant submits that in view of the facts and circumstances of the case as well as in law said Order passed is bad in law and deserves to be quashed. 2. Learned Commissioner of Income Tax (Appeals) erred in confirming the order of Learned Assessing Officer in disallowing a sum of Rs. 1,96,514/- under Section 23(1)(a) of the Act. Appellant submits that in view of the facts and circumstances of the case as well as in law said disallowance u/s 23(1)(a) of the Act is bad in law and deserves to be deleted.

3. Learned Commissioner of Income Tax (Appeals) erred in confirming the order of Learned Assessing Officer in disallowing a sum of Rs. 2,86,438/- under Section 14A of the Act. Appellant submits that in view of the facts and circumstances of the case as well as in law said disallowance u/s 14A of the Act is bad in law and deserves to be deleted. Appellant prays for appropriate relief. Appellant craves leave to add, alter, amend or withdraw any of the above grounds of Appeal.”

3.

At the time of hearing, none appeared on behalf of the assessee in spite of issuance of notices for hearing on the address given by the assessee in Form No. 36 (column No.10), and the ld.Departmental Representative is present for the respondent- revenue. In absence of appearance of the assessee, the appeal is being disposed of exparte qua the assessee after hearing the ld.Departmental Representative on merits in terms of Rule 26 of the Income Tax (Appellate Tribunal) Rules, 1963.

4.

We note that the impugned order passed by the ld. CIT(A) is an exparte order and the assessee could not plead his case during the appellate proceedings. During the course of appellate proceedings, notices for hearing were issued to the assessee, the details of which are as follows:-

Date of issue of Date of hearing Remarks notice 27/06/2016 01/08/2016 Notice returned with the remarks ‘unclaimed’. 02/08/2016 31/08/2016 Request for adjournment submitted on 31/08/2016. Accordingly, adjourned to 21/09/2016. --- 21/09/2016 None attended 19/09/2016 19/10/2016 Notice returned by the postal authorities

It is clear from the date of hearings noted above that the assessee has participated in appellate proceedings. We also note that grounds Nos. 1 & 2 raised by the assessee relate to the grievance of the assessee that he has not been given reasonable opportunity of being heard, therefore, it is against the principles of natural justice. At the cost of repetition, ground No.1 raised by the assessee is given below for ready reference:- “1. Learned Commissioner of Income Tax (Appeals) erred in passing an Order without affording a reasonable opportunity of being heard to the Appellant. Appellant submits that in view of the facts and circumstances of the case as well as in law said Order passed is bad in law and deserves to be quashed.”

5.

A perusal of the body of the impugned order passed by the ld. CIT(A) shows that it is an exparte order, which has been challenged by the assessee for want of proper opportunity. Therefore, we are of the view that one more opportunity should be given to the assessee to plead his case before the ld. CIT(A). Under these facts and circumstances of the case, we deem it fit and proper to set aside the order passed by the ld.CIT(A) and remand the matter back to the file of the ld.CIT(A) for consideration on merits after affording opportunity of being heard to the assessee. Thus, this appeal filed by the assessee is allowed for statistical purposes.

6.

In the result, appeal filed by the assessee is allowed for statistical purposes. Order Pronounced in open Court on this 22nd day of June, 2018.

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