ITO, WD-5(1), KOLKATA, KOLKATA vs. M/S SURICHI DISTRIBUTORS PVT. LTD., KOLKATA

Per Shri A.T.Varkey, JM

2 Surichi distributor Pvt. Ltd., AY 2009-10 Bank of India and Vijaya Bank. Thereafter, the order sheet doesn’t say anything about hearing etc. According to Ld. AR, the assessee never received any notice. According to Ld. AR, the assessee had produced all the documents before the AO to discharge the onus casted upon it. However, we note that the AO has not recorded anything to that effect and without considering the evidences adduced by the assessee, in an arbitrary manner without following the guidelines to investigate as directed by the Ld. CIT has passed an assessment order against the assessee. On appeal, we note that the Ld. CIT (A) has simply accepted whatever the assessee produced without examining the veracity of the averments pleaded before him, which makes the order bad in law for non application of mind. We also hasten to say that we cannot take our eyes of the fact that AO has also not taken into consideration the evidence adduced by the assessee to discharge the onus casted upon it while adjudicating the issue before him. So, for the ends of justice, the matter needs to be remanded back to the AO for fresh assessment de novo. Taking into consideration the aforesaid facts, we note that since the assessee did not get proper opportunity before the AO as evident from a perusal of the order sheet and as discussed above, we are of the opinion that the assessee did not get proper opportunity before the AO. The Hon’ble Supreme Court (three judges bench) in the case of Tin Box Company Vs. CIT (2001) 249 ITR 216 (SC) has held as under:

“It is unnecessary to go into great detail in these matters for there is a statement in the order of the Tribunal, the fact-finding authority, that reads thus : “We will straightaway agree with the assessee’s submission that the Income-tax Officer had not given to the assessee proper opportunity of being heard.” That the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is the assessment order that counts. That order must be made after the assessee has been given a reasonable opportunity of setting out his case. We, therefore, do not agree with the Tribunal and the High Court that it was not necessary to set aside the order of assessment and remand the matter to the assessing authority for fresh assessment after giving to the assessee a proper opportunity of being heard. Two questions were placed before the High Court, of which the second question is not pressed. The first question reads thus : “1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in not setting aside the assessment order in spite of a finding arrived at by it that the Income- tax Officer had not given a proper opportunity of hearing to the assessee ?” In our opinion, there can only be one answer to this question which is inherent in the question itself : in the negative and in favour of the assessee.

3 Surichi distributor Pvt. Ltd., AY 2009-10 The appeals are allowed. The order under challenge is set aside. The assessment order, that of the Commissioner (Appeals) and of the Tribunal are also set aside. The matter shall now be remanded to the assessing authority for fresh consideration, as aforestated.”

Order is pronounced in the open court on 3rd May, 2018. Sd/- Sd/- (J. Sudhakar Reddy) (A. T. Varkey) Accountant Member Judicial Member Dated: 3rd May, 2018 Jd.(Sr.P.S.) Copy of the order forwarded to: