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Facts
The assessee filed its return for AY 2021-22 declaring Nil income and a business loss. Subsequently, total income was assessed at Rs. 2982,56,38,182/-. A penalty of Rs. 48,08,20,407/- was imposed under section 271AAC(1). The assessee's appeal before the CIT(A) was dismissed ex-parte.
Held
The tribunal noted that the assessee did not respond to notices from the AO and CIT(A), leading to an ex-parte order. However, for the interest of justice and fair play, the tribunal decided to grant a last opportunity to the assessee and remitted the matter back to the CIT(A) for denovo adjudication.
Key Issues
Whether the ex-parte dismissal of the appeal by the CIT(A) violated principles of natural justice. Whether to grant a last opportunity to the assessee for denovo adjudication.
Sections Cited
250, 271AAC(1), 143(1), 143(3), 271AAAC1
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘D’ BENCH
Before: SHRI OM PRAKASH KANT & SHRI SUNIL KUMAR SINGH
आदेश / O R D E R PER SUNIL KUMAR SINGH (J.M): 1. This appeal has been preferred against the impugned order dated 29.04.2024 passed in Appeal no. NFAC/2020- 21/10263627 by the Ld. Commissioner of Income– Rolta Defence Technology Systems Pvt. Ltd. Through Neha Jain Nemani, Resolution Professional tax(Appeals)/ National Faceless Appeal Centre (NFAC) [hereinafter referred to as the “CIT(A)”] u/s. 250 of the Income- Tax Act, 1961 [hereinafter referred to as "Act"] for the Assessment year [A.Y.] 2021-22, wherein assessee’s appeal against the penalty order dated 27.06.2023 passed u/s. 271AAC(1) of the Act, has been dismissed ex-parte by the learned CIT(A).
The brief facts under appeal state that the assessee filed its return of income for the A.Y. 2021-22, declaring total income of Nil with current year business loss of Rs. 3,92,12,935/-.The return was processed u/s. 143(1) of the Act. Subsequently, the total income of the assessee was assessed at Rs. 2982,56,38,182/-. Vide order dated 26.12.2022 passed u/s. 143(3) of the Act. Separate penalty proceedings were initiated u/s. 271AAC(1) of the Act and a penalty of Rs. 48,08,20,407/- was imposed vide penalty order dated 27.06.2023.
Aggrieved by the penalty order, assessee preferred an appeal before learned CIT(A), who dismissed assessee’s appeal ex- parte.
Assessee has filed this second appeal on the ground that learned CIT(A) has erred in law and on the facts of the case in sustaining the order of the assessing officer levying penalty u/s. 271AAAC1 of the Income Tax Act amounting to Rs. 48,08,20,240/-.
In response to the notice issued by the tribunal, learned DR appeared and participated in the hearing.
Rolta Defence Technology Systems Pvt. Ltd. Through Neha Jain Nemani, Resolution Professional 6. We have perused the records and heard learned representatives for both the parties.
Learned representative for the assessee has, at the very outset informed that impugned order has been passed by learned CIT(A) ex-parte in violation of the principles of natural justice. Prayed to set aside the impugned order.
Learned DR has submitted that assessee was provided sufficient opportunity of hearing by learned CIT(A) but for no avail. Learned DR has supported impugned order.
We notice that the assessee did neither respond to the various notices issued by the learned Assessing Officer nor did he respond to the notice issued by learned CIT(A). The irresponsive conduct of the assessee resulted in passing ex- parte impugned order under compulsion. However, in the interest of justice and fair play, we deem it just and appropriate to afford last opportunity to the assessee and remit the matter back to the file of learned CIT(A) for denovo adjudication on merits afresh. We further direct the assessee to be diligent and cooperative in attending the hearings and making submissions before the learned CIT(A) for the expeditious and effective disposal. Assessee should refrain from seeking any adjournment but for compelling and unavoidable circumstances to be decided by learned CIT(A). Needless to say that learned CIT(A) shall ensure the observance of the principles of natural justice. It is made clear that we have not made any observation in respect of the merits of the case. The appeal is liable to be allowed.
Rolta Defence Technology Systems Pvt. Ltd. Through Neha Jain Nemani, Resolution Professional 10. In the result, the appeal is allowed in above terms. Impugned order dated 29.04.2024 and penalty order dated 27.06.2023 are set aside. The case is restored back to the file of the learned CIT(A) for statistical purposes. Order pronounced on 29.10.2024.