M/S SKYLARK TRACOM PVT. LTD.,KOLKATA vs. CIT, KOLKATA-1, KOLKATA

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ITA 1089/KOL/2014Status: DisposedITAT Kolkata13 July 2018AY 2009-20102 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT's order was passed in violation of natural justice as no proper notice was served on the assessee. Therefore, the order was set aside.

What were the facts?

The assessee's appeal was against an ex parte order passed by the CIT under Section 263. The CIT's notice for the Section 263 proceedings was returned unserved as it was sent to an old address, while the department was aware of the assessee's current address.

What were the issues?

Whether an order passed under Section 263 without proper service of notice to the assessee is valid and whether it violates principles of natural justice.

Which sections of the Income-tax Act were involved?

Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH: KOLKATA

Hearing: 24.04.2018Pronounced: 13.07.2018

ORDER

Per Shri A.T.Varkey, JM

1.

This appeal filed by the assessee is against the order of Ld. CIT, Kol-1, Kolkata dated 24.03.2014 for AY 2009-10 passed u/s. 263 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”).

2.

At the time of hearing, the Ld. Counsel for the assessee submitted that the impugned order passed by the Ld. CIT is an ex parte order. He also drew our attention to para 6 of the impugned order wherein the Ld. CIT noted that “a notice u/s. 263 of the I. T. Act, 1961 was issued for the said reasons on 22.01.2014 fixing the hearing on 17.02.2014 which could not be served through postal service since no such company was found existing at the given address. The notice came back from the Postal authorities unserved.” He also submitted that the notice was sent to old address i.e. 132, Cotton Street, 4th floor, Kolkata-700 007. However, he submitted that the current address of assessee is 6A, Saket Place – 4th floor, Kolkata-700 072 which was already in the records of the Income Tax Department as is evident from the order passed u/s. 147/143(3) of the Act. Hence, he urged before the bench to quash/set aside the order of the Ld. CIT passed u/s. 263 of the Act. On the other hand, Ld. DR relied on the order of the Ld. CIT.

2 Skylark Tracom Pvt. Ltd., AY: 2009-10 3. We have heard rival submissions and gone through the facts and circumstances of the case. We note from the impugned order dated 24.03.2014 that no notice in respect of the proceedings u/s. 263 of the Act could be served on the assessee. Para 6 of the order of Ld. CIT records that notice dated 22.01.2014 could not be served on the assessee, since the assessee did not exist at its given address. However, it is evident from the assessment order of the AO that the department was aware of the present address of the assessee. Before invoking revisional jurisdiction under section 263 of the Act, the Pr. CIT must give the assessee an opportunity of being heard. Since it is evident from a reading of the impugned order itself that no notice of the proceedings u/s. 263 of the Act was served upon the assessee since it returned back, the impugned order of Ld. CIT(A) is fragile for violation of natural justice and, therefore, the order passed u/s. 263 of the Act dated 24.03.2014 is liable to be set aside and we remand the matter back to the Pr. CIT to give fresh opportunity to assessee to be heard and pass order in accordance to law. This view of ours gets supports from a similar view expressed by the Hon’ble Calcutta High Court in a similar case of GA No. 1298 of 2016 M/s. Ratnagiri Commercial Pvt. Ltd. & Anr. Vs. ITO dated 17.05.2016. Therefore, the appeal of assessee is allowed for statistical purposes.

4.

In the result, the appeal of assessee is allowed for statistical purposes.

Order is pronounced in the open court on 13.07.2018

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