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Facts
The assessee filed an appeal against the order of the Addl. CIT(A) which dismissed the appeal ex-parte. The AO had made several disallowances from various expenses during the assessment proceedings.
Held
The Tribunal noted that the appellate order was passed without giving the assessee a proper opportunity to present their case. Therefore, the case was restored to the Addl. CIT(A) for a fresh decision on merits.
Key Issues
Whether the assessee was denied natural justice by not being given adequate opportunity to present evidence and arguments before the appellate authority.
Sections Cited
250, 37(1), 40A(3), 69C, 36(1)(iii), 143(3)
AI-generated summary — verify with the full judgment below
Before: SMT. BEENA PILLAI & SMT. RENU JAUHRI
Appellant by : Shri Pankaj Toprani Respondent by : Ms. Usha Gaikwad Date of Hearing 17.10.2024 Date of Pronouncement 19.11.2024 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the Learned Additional Commissioner of Income-tax (Appeals), Delhi-1 [hereinafter referred to as “Addl. CIT(A)”] dated 19.06.2024 passed u/s. 250 of the Income- tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2015- 16.
The assessee has raised following grounds of appeal: “1) The Learned Commissioner of Income Tax (Appeal) has erred in confirming the disallowance made by the A.O. of Business Promotion u/s 37(1) of Rs. 7,43,137/- A.Y. 2015
16. Jayesh Pavitraray Tolia 2) The Learned Commissioner of Income Tax (Appeal) has erred in has erred in confirming the disallowance made by the A.O. of Gift amounting to Rs. 5,07,864/-u/s 37(1) 3) The Learned Commissioner of Income Tax (Appeal) has erred in has erred in confirming the disallowance made by the A.O. of 10% of Motor Car Expenses, Insurance and Depreciation amount to Rs. 72,083/- (i.c. 10% of Rs. 2,17,422/57,919/- 4,45,485/-) u/s 37(1) 4) The Learned Commissioner of Income Tax (Appeal) has erred in confirming the disallowance made by the A.O. of Office Expenditure (Repairs & Maintenance) of Rs. 2,65,000/- u/s 40A(3). 5) The Learned Commissioner of Income Tax (Appeal) has erred in confirming the disallowance made by the A.O. of Rs. 83,000/- of Repairs and Maintenance Expenses u/s 37(1) 6) The Learned Commissioner of Income Tax (Appeal) has erred in confirming the disallowance made by the A.O. of Rs. 2,52,000/- being 30% of Rs.8,40,000/- of Salary Expenses 7) The Learned Commissioner of Income Tax (Appeal) has erred in confirming the disallowance made by the A.O. of u/s 69C as unexplained expenditure of Rs. 6,984/- 8) The Learned Commissioner of Income Tax (Appeal) has erred in making disallowance made by the A.O. of Rs.17,560/- Interest paid u/s 36(1)(iii) 9) The Learned Commissioner of Income Tax (Appeal) has erred in making disallowance made by the A.O. of Rs.29,442/-being 20% of Telephone Expenses of Rs. 1,47,208/-u/s 37(1) 10) The Lower Authorities erred in not granting the opportunity of cross examination to the assessee despite his request for the same. 11) Both the Lower Authorities has denied the client natural justice by not providing the material they have relied on. 12) The order appealed against is bad in law and against the principal of natural justice.”
3. The brief facts of the case are that the assessee, who is an intending agent for supply of pharmaceutical intermediates and dyes, filed his return declaring income of Rs. 7,91,840/- 0n 08.07.2016. The AO while framing the assessment u/s 143(3) made some disallowances out of various expenses as such business promotion, gifts, car expenses, repairs & maintenance etc. and finalized the assessment.
4. Aggrieved with this order dated 25.12.2017, the assessee filed an appeal on 10.01.2018. Ld. Addl. CIT(A) issued 4 notices in response to which except A.Y. 2015-16 Jayesh Pavitraray Tolia one request for adjournment, no details/written submissions were filed by the assessee. Accordingly, the Ld. Addl. CIT(A) proceeded to decide the appeal exparte after considering material available on record. Vide order dated 19.06.2024, assessee’s appeal was dismissed by Ld. Addl. CIT(A). Aggrieved with the order, the assessee is in appeal before us.
We have heard the rival submissions. The Ld. AR has reiterated that the assessee was denied natural justice as he was not provided the opportunity of furnishing requisite evidence and material in support of its claim.
It is seen that the appellate order has been passed without giving proper opportunity to the assessee to substantiate his contentions. We, therefore, deem it appropriate to restore the case to the Ld. Addl. CIT(A) for passing a fresh order on merits after giving due opportunity to the assessee. The assessee is also hereby directed to make requisite compliance before the Ld. Addl. CIT(A).