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Facts
The assessee filed an appeal against the order of the CIT(A) confirming an addition of Rs. 23,58,700/-. The CIT(A) had rejected the assessee's appeal stating that the appellant did not respond to notices and failed to file documentary evidence. The assessee's AR submitted that the CIT(A) did not consider the facts correctly and ignored submissions.
Held
The Tribunal held that inadequate opportunity to the assessee is a violation of principles of natural justice. Relying on the Supreme Court judgment in Tin Box Company vs. CIT, the Tribunal stated that an assessment order must be made after giving a reasonable opportunity to the assessee.
Key Issues
Whether the notice u/s 148 was valid and whether the assessee was granted adequate opportunity of being heard and to present submissions before the CIT(A).
Sections Cited
144, 147, 148, 250
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Income Tax Appellate Tribunal, JODHPUR BENCH (Virtual
Before: SHRI RAJPAL YADAV, HONBLE & DR. MITHA LAL MEENA, HONBLE
PER DR. MITHA LAL MEENA, A.M.: This Appeal by the assessee is directed against the order of National Faceless Appeal Central, Delhi (hereinafter referred to as "NFAC/CIT(A)"] dated 24.01.2025 in respect of assessment year 2010-11 challenging therein order passed by Ld. CIT(A) confirming addition of Rs. 23,58,700/- in the assessment order passed u/s 144 r.w.s.147 of the act.
The appellant has raised two issues in the grounds of appeal. Firstly, he challenged validity of the notice u/s 148 of the Act as bad in law and secondly not granted benefit of Peak Credit/Telescoping.
Heard both the sides and perused the material on record. We find that ld. CIT(A) has rejected the appeal of the assessee by stating that appellant did not respond to the notice of hearings before the AO and before him as well in filing the requisite documentary evidence in support of his claims. However, the Ld. AR submitted that the Ld. CIT(A) has not mentioned the correct facts and ignored the submission of the assesseee. He pleaded that if he has been granted due opportunity with proper service of notice u/s 250 of the Act, to enable the assessee to present his submissions in defence of the claims made in the grounds of appeal, as he has good arguable case and he undertakes that he could substantiate the claims made in the grounds. In our view, inadequate opportunity certainly tantamount to violation of principles of natural justice and debarred the assessee to argue its case before the CIT (A) on merits.
From the record, we find that the Ld. CIT (A) although adjudicated the appeal on merits but he ought to have rebutted the submission of the appellant by granting adequate opportunity to the assessee and He deemed to have disproved the claim of the assesse by rebutting its contention with support of corroborative documentary evidence on record. The Hon'ble Supreme Court of India in the case of Supreme Court of India observed as under: "Assessment - Opportunity of being heard - Setting aside of assessment Assessment order must be made after the assessee has been given reasonable opportunity of setting out his case - Same not done - Fact that the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is assessment order that counts — Assessment order set aside and matter remanded to assessing authority for fresh consideration."
Considering the principles of natural justice, it would be appropriate to restore the matter back to the file of the ld. CIT(A) to adjudicate the appeal of the assessee afresh by addressing the grounds of appeal on merit of the case after granting adequate opportunity of being heard to the assessee and considering the written submissions and documentary evidences filed on record and may be filed in the de novo appellate proceedings. In the case, the CIT (A) is not satisfied with the reply of the assessee, and he intends to take any adverse view against the appellant-assessee, then the assessee may be allowed an opportunity to rebut.
Accordingly, the impugned order is set aside and the matter is remanded back to the file of the ld. CIT(A)/NFAC to adjudicate the issue de novo in accordance with law.
In the result, this appeal is allowed for statistical purposes. Order pronounced on 27/05/2025 in the open Court. (RAJPAL YADAV) VICE PRESIDENT Dated: 27.01.05/2025 (DR. MITHA LAL MEENA) ACCOUNTANT MEMBER