M/S RAJSHREE VINIMAY PVT. LTD.,KOLKATA vs. ITO, WARD-2(1), KOLKATA, KOLKATA

आदेश/O R D E R PER Dr. A.L. Saini, AccountantMember:-

2.At the time of hearing none appeared on behalf of assessee in spite of issuance of notice for hearing more than one occasion and Ld. Departmental Representative(DR), was present for the respondent Revenue. In the absence M/s Rajshree Vinimay Pvt. Ltd. Vs. ITO Wd-2(1), Kol. Page 2 of any appearance by the assessee, the appeal is being disposed of ex parte qua the assessee, after hearing Ld. DR for the Revenue on merits in terms of Rule 24 of the Income Tax Appellate, Tribunal, 1963.

3.At the outset, it was observed from the order of Ld. CIT(A) that the case was fixed for hearing on various occasions but the assessee, most of the time remained absent. Therefore, the appeal was decided by Ld. CIT(A) ex parte, on 28.10.2016. Against the impugned ex parte order of Ld. CIT(A),assesseeis in appeal before us and submitted in grounds of appeal that the impugned order has been passed without giving opportunity to the assessee. The assessee has raised ground No.1, 2, 5 and 6 wherein he has stated that ld CIT(A) passed the order without giving reasonable opportunity of being heard and did not pass the speaking order. These grounds are mentioned below for read reference:

“1.For that the order of ld CIT(A) is arbitrary, illegal and bad in law. 2.For that the ld CIT(A) erred in passing the order ex-parte without allowing the appellant and proper and reasonable opportunity of being heard.

5. For that on the facts and circumstances of the case, the ld CIT(A) erred in confirming the order of the AO without passing any speaking order.

4.On perusal of appellate order, we find that Ld. CIT(A) affirmed the action of Assessing Officer ex parte without mentioning any reason for confirming the same on merits. The provisions of Section 250(6) of the Act require the Commissioner (Appeal) to dispose of the appeal in writing with reason for decision. Thus, in such circumstances,we find that the ld. CIT(A) has not passed the speaking order.

5.1 In the assessee`s case under consideration, during the assessment proceedings, we observe that file of the assessee has been transferred from one Income Tax Officer to another Income Tax officer and assessee`s case was fixed for hearing only for two occasions, the assessing officer ought to have done the assessment by providing more opportunity to the assessee and since no more opportunity was given to the assessee at the time of assessment proceedings on the addition/disallowance made, the proper course to be taken is that the matter needs to be remanded back to the assessing officer.In support of this, we rely on the decision of Hon’ble Supreme Court (three judges Bench) in Tin Box Company Vs. CIT (2001) 249 ITR 216 (SC) wherein the Hon’ble Supreme Court 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.

M/s Rajshree Vinimay Pvt. Ltd. Vs. ITO Wd-2(1), Kol. Page 4 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. 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.”

Since, we are of the opinion that proper opportunity was not given to the assessee during the assessment proceedings, therefore, we are inclined to remand the assessment back to the assessing officer. In the light of the aforesaid decision of the Hon’ble Supreme Court, cited supra, we set aside the order of CIT(A) and remand the matter back to the file of the AO for de novo adjudication in accordance with law. Needless to say, assessee should be given reasonable opportunity of being heard by the AO and we give liberty to assessee to adduce evidence in support of its claim. The assessee is also directed to cooperate in the de novo assessment proceedings before the AO therefore appeal of assessee is allowed for statistical purposes.

5.2 In the result, appeal of the assessee is allowed for statistical purposes.