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Facts
The assessee, a builder and developer, filed its return of income for AY 2013-14, which was assessed and later re-opened. The CIT(A) dismissed the appeal for non-prosecution after issuing several notices. The assessee contended that due to the Covid-19 pandemic, there were disturbances causing non-attendance to initial notices, and that they had responded to subsequent notices.
Held
The Tribunal noted that the assessee had responded to the notices and, in the interest of justice, decided to set aside the ex-parte order. The CIT(A) was directed to decide the issues afresh after providing the assessee with adequate opportunity of being heard.
Key Issues
Whether the CIT(A) erred in dismissing the appeal for non-prosecution without considering the grounds on merit, especially considering the circumstances like the Covid-19 pandemic and the assessee's response to notices.
Sections Cited
Sec. 35, Sec. 143(3), Sec. 147, Sec. 148, Sec. 234B, Sec. 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI NARENDRA KUMAR BILLAIYA, HON’BLE & SHRI SANDEEP SINGH KARHAIL, HON’BLE
सुनवाई की तारीख/Date of Hearing : 14/08/2024 घोषणा की तारीख/Date of Pronouncement : 20/08/2024 आदेश/O R D E R
PER NARENDRA KUMAR BILLAIYA, AM :
This appeal by the assessee is preferred against the order dated 30/05/2024, framed by the NFAC, Delhi, [in short ‘ld. CIT(A)’], pertaining to Assessment Year 2013-14.
The grievance of the assessee reads as under:- “This Appeal is filed against Ex-party order passed by Hon'ble CIT (A) NFAC on the following grounds of appeal each one of them should be considered separately of others. 1.1 The Hon'ble CIT (A), NFAC erred in facts and circumstances of the case and in law in passing Ex-party order and rejecting the appeal without considering various grounds on merit. 1.2 Your appellant has partially responded to various notices/ letters issued by CIT (A) NFAC, in appeal proceedings 1.3 The Hon'ble CIT (A) has not given sufficient time and opportunity to your appellant to make detailed submission and to attend appeal proceedings in person 1.4 Your appellant pray that the Ex-party order is to be set aside and the matter to be revert back to Hon'ble CIT (A) to hear the appeal on merit.
2.1 The Hon'ble CIT (A), NFAC erred in facts and in circumstances of the case and in Law in upholding A.O. action in re-opening of already completed assessment in scrutiny U/s. 143(3).
2.2 Your appellant pray that the assessment has been wrongly and incorrectly re- opened U/s. 147 and notice U/s. 148 is wrongly and incorrectly issued. Order passed U/s. 143(3) r.w.s. 147 by Ld. AO is to be quashed.
3.1 The Hon'ble CIT (A), NFAC has wrongly and incorrectly upheld the AO action in making the addition of notional annual ratable value of 3 flats which remains in sotck as on 31/03/2013, additing Rs. 3,80,814/- as a notional income from House Property.
3.2 Your appellant has not rented out the said 3 flats and no rental income has been earned out of the 3 flats.
3.3 Your appellant is Builder and Develepor and the said 3 flats remained in stock as on 31/03/20213 was in process of sale to prospective buyers.
3.4 Your appellant prays that no income from house property is to be notionally taxed in case of appellant, who is Builder and Developer and addition made to total income under the head "income from house property" at Rs. 3,80,814/- is to be deleted.
4.1 The Ld. AO has wrongly and incorrectly levied interest U/s. 234B of Rs. 13,30,148/- instead of Rs. 2,76,198/- as per Return of Income.
4.2 Your Appellant prays that the interest U/s. 234B is to be restricted to Rs. 2,76,198/- and excess interest charged U/s. 234B at Rs. 10,53,950/- (Rs. 13,30,148 - Rs. 2,76,198) is to be deleted.
5.1 Your appellant prays for the leave to add, amend, alter, modify or delete any of the grounds of appeal
.”
3. Briefly stated, the facts of the case are that the assessee has filed its return of income on 28/09/2013 declaring total income of Rs.12,33,11,920/-. The assessment was completed on 30/03/2016 assessing total income at Rs.12,76,86,920/- making disallowance of deduction u/s 35 of the Act amounting to Rs.43.75 Lakhs. The assessment was reopened u/s 147 of the Act and accordingly statutory notices were issued and served upon the assessee. Assessment u/s 143(3) r.w.s. 147 of the Act was framed vide order dt. 19/11/2018 interalia making disallowance of addition for income from house property amounting to Rs.3,80,814/-. 3.1. The assessee carried the matter before the ld. CIT(A). The ld. CIT(A) dismissed the appeal of the assessee for non-prosecution.
4. We have carefully considered the order of the ld. CIT(A), we find that NFAC issued four notices. The first two notices dated 21/02/2020 and 25/01/2021 were not attended by the assessee. The reason for non- attendance is that, it was the period of Covid-19 and due to pandemic, there was total disturbance. In compliance to the notices dated 01/11/2022, the assessee electronically filed the following response:- “To, Date: 02/11/2022 The Hon. CIT (A), NFAC, New Delhi.
Respected Sir, Sub: Note in response to Letter dated 31/10/2022 (DIN: ITBA/NFAC/S/62/2022- 23/1046555671(1)
Ref: 1. PAN: AAEFD5810B