MAHASHAKTI FINANCIERS LIMITED,AMAN TOWER, NATIONAL HIGHWAY vs. ITO WARD 1(2), JAMMU, AAYKAR BHAWAN, RAIL HEADCOMPLEX, PANAMA CHOWK, JAMMU
Facts
The assessee, Mahashakti Financiers Ltd., appealed against a CIT(A) order which confirmed an addition of Rs. 74,66,000/- under section 68 for unexplained share application money. The assessee contended that the CIT(A) denied a proper opportunity of hearing by not sending notices to the correct email ID and also raised an additional legal ground challenging the Assessing Officer's jurisdiction.
Held
The Tribunal found that it was unclear whether proper notices for hearing were served by the CIT(A) to the assessee's specified email ID. Therefore, in the interest of justice, the matter was remanded back to the CIT(A) for fresh adjudication of all grounds on merits, after providing the assessee a proper opportunity of being heard as per section 282 read with Rule 127. The Tribunal clarified that it had not expressed any opinion on the merits of the case.
Key Issues
Key issues involved the CIT(A)'s alleged denial of a proper hearing to the assessee, the justification of a Section 68 addition for unexplained share application money, and a challenge to the Assessing Officer's jurisdiction.
Sections Cited
Section 250, Section 143(3), Section 68, Section 282, Rule 127 of I.T. Rules, 1962
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Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR
Before: SH. UDAYAN DASGUPTA & SH. BRAJESH KUMAR SINGH
Per Udayan Dasgupta, J.M.:
This appeal is filed by the assessee against the order of the the ld. CIT(A) National Faceless Appeal Centre (NFAC), Delhi, passed u/s 250 of the Income Tax
Act 1961, dated 22.05.2023, which has emanated from the order of the ITO, Ward- 1(2), Jammu dated 24.12.2018 passed u/s 143(3) of the I.T. Act, 1961.
2 I.T.A. No. 211/Asr/2023 Assessment Year: 2016-17 2. From the grounds of appeal filed by the assessee in Form No. 36, it is observed
that one of the dispute is in relation to the addition of Rs.74,66,000/- made u/s 68 of
the Act, 1961 on account of unexplained share application money, flowing from the
inability of the assessee to prove the identity, the genuineness of the transactions and
the creditworthiness of the share holders.
Another ground taken by the assessee was that the order has been passed by
the first appellate authority without any proper opportunity of hearing which violates
the principles of natural justice. In course of hearing before the Tribunal, the ld. AR
at the very onset pointed out to page no. 3 of the appellate order and submitted that as
evident from the contents of the order, it is seen that notices has been issued by the
ld. CIT(A) on ten different occasions, but none of the notices has been issued in the
e-mail id provided in Form No. 35. He further submitted that no notice has been
received from the office of the ld. first appellate authority in course of hearing of the
appeal proceedings, and as such, explanations and submissions along with the
documentary evidences could not be produced in support of his case.
The ld. AR submitted that apart from the grounds contained in Form No. 36,
additional ground has also been raised by way of separate application challenging the
jurisdiction of the Assessing Officer and has submitted, that the same being a legal
ground which goes to the very root of the proceedings, the same may please be
3 I.T.A. No. 211/Asr/2023 Assessment Year: 2016-17 entertained in view of the decision of the Hon’ble Apex Court in the case of NTPC v.
CIT 229 ITR 383 (SC). He further prayed for remand of the matter back to the files of
the ld. CIT(A) for consideration and adjudication of all the grounds contained in
Form No. 35 on merits of the case.
The ld. DR relied on the order of the ld. CIT(A) but has no objection if the
matter is remanded back to the ld. first appellate authority for fresh adjudication,
because in absence of any documentary evidences and submission before him, the ld.
CIT(A) could not adjudicate the grounds on merits of the case.
We have heard the rival submissions and considered the materials on record
and we are of the opinion that in the instance case, it is not apparent or ascertainable
from records whether notice of hearing has been served or issued in the e-mail id of
the assessee as stated in Form No. 35 and the ld. CIT-DR also could not confirm as to
whether any notice of hearing has actually been served on the assessee or not.
As such, we are of the opinion that in the interest of justice, the matter is
remanded back to the files of the ld. CIT(A) for consideration of all the grounds
contained in Form No. 35 on merits of the case and the assessee is also directed to
file all documentary evidences and written submissions along with explanations, if
any, before the first appellate authority in support of his grounds of appeal and to
fully cooperate in appellate proceedings for proper disposal of the case.
4 I.T.A. No. 211/Asr/2023 Assessment Year: 2016-17 8. The assessee should be allowed proper and reasonable opportunity of being
heard and notices to be issued as per provisions of section 282 of the Act, 1961 (read
with rule 127 of the I.T. Rules, 1962).
We have not expressed any opinion on merits of the case and all legal
contentions are kept open.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in open court as on 30.05.2025.
Sd/- Sd/- (Brajesh Kumar Singh) (Udayan Dasgupta) Accountant Member Judicial Member *GP/Sr.PS* Copy of the order forwarded to: (1)The Appellant: (2) The Respondent: (3) The CIT concerned (4) The Sr. DR, I.T.A.T True Copy By Order
