RUBY (PARK) PROPERTIES PVT. LTD., ,KOLKATA vs. ITO, WARD - 8(3), KOLKATA , KOLKATA

The assessee in the present case is a Company, which filed its return of income for the year under consideration on 28.12.2004 declaring total income of Rs.21,430/-. The said return was initially processed by the Assessing Officer under section 143(1) of the Act on 05.04.2005. The assessment, however, was subsequently reopened by the Assessing Officer and a notice under section 148 was issued by him to the assesse on 26.03.2009 after recording the reasons. In reply, a letter was filed by the assessee stating that the return originally filed by it on 28.12.2004 be treated as return filed in compliance to the notice under section 148. The assessee also obtained the copy of reasons recorded by Assessment year: 2004-2005 Page 2 of 3 the Assessing Officer and raised its objection challenging the validity of reopening of assessment. The Assessing Officer did not find the said objection sustainable and overruled the same for the reasons given in the assessment order. During the year under consideration, the assessee- company had received rental income of Rs.5,21,507/- and after claiming the same as business income, deduction on account of various expenses was claimed by it. In the re-assessment completed by the Assessing Officer under section 147/143(3) vide an order dated 31.12.2009, the entire rental income earned by the assessee was brought to tax by the Assessing Officer under the head “income from other sources” and all the expenses claimed by the assessee were disallowed by him.

Against the order passed by the Assessing Officer under section 147/143(3), an appeal was preferred by the assessee before the ld. CIT(Appeals) challenging the validity of the said assessment as well as disputing the head of income in respect of rental income, which was changed by the Assessing Officer to income from other sources resulting into disallowance of expenses. During the course of appellate proceedings before the ld. CIT(Appeals), there was, however, no compliance on the part of the assessee to the notices issued by the ld. CIT(Appeals) fixing the said appeal for hearing from time to time. The ld. CIT(Appeals), therefore, dismissed the appeal of the assessee vide his appellate order dated 17.10.2017 passed ex-parte. Aggrieved by the order of the ld. CIT(Appeals), the assessee has preferred this appeal before the Tribunal.

I have heard the arguments of both the sides and also perused the relevant material available on record. As submitted by the ld. Counsel for the assessee, the appeal of the assessee was fixed for hearing by the ld. CIT(Appeals) on three different dates spanning over a period of only one and half months and since none of the notices of the said hearings was received by the assessee, the assessee could not comply with the same. Keeping in view this submission made by the ld. Counsel for the assessee, I am satisfied that there was a sufficient cause for non-compliance on Assessment year: 2004-2005 Page 3 of 3 behalf of the assessee before the ld. CIT(Appeals) when its appeal was fixed for hearing on three occasions. I, therefore, set aside the impugned order passed by the ld. CIT(Appeals) ex-parte and remit the matter back to him for disposing of the appeal of the assessee afresh on merit after giving proper and sufficient opportunity of being heard to the assessee. As undertaken by the ld. Counsel for the assessee, the assessee shall make due compliance before the ld. CIT(Appeals) and shall extend all the possible cooperation in order to enable the ld. CIT(Appeals) to dispose of the appeal on merit expeditiously.

In the result, the appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on June 20, 2018.