ADITYA CONSTRUCTION COMPANY,MUMBAI vs. ITO 33(1)(1), MUMBAI

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ITA 3766/MUM/2015Status: DisposedITAT Mumbai26 September 2017AY 2007-083 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the matter to the AO for a fresh assessment (denovo assessment). The AO was directed to consider the documents submitted by the assessee and provide an opportunity for a hearing.

What were the facts?

The assessee did not appear before the Assessing Officer (AO) or the Commissioner of Income Tax (Appeals) (CIT(A)), leading to an ex-parte assessment and dismissal of the appeal. The assessee later presented documents to the Tribunal, explaining their inability to comply due to financial difficulties and legal battles over property encroachment.

What were the issues?

Whether the assessee's failure to appear before the lower authorities due to financial distress and legal issues warrants a fresh assessment to consider submitted documents.

Which sections of the Income-tax Act were involved?

Section 148,Section 144,Section 143(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “F”, MUMBAI

Before: D.T. GARASIA & SHRI G. MANJUNATHA

For Appellant: Shri N.L. Shah, A.R
For Respondent: Ms. Pooja Swaroop, D.R
Hearing: 22.09.2017Pronounced: 26.09.2017

Per D.T. GARASIA, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 27.03.2015 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2007-08.

2.

The short facts of the case are that the assessee filed the return of income on 23.01.2008 declaring the total income at Nil. The Assessing Officer (hereinafter referred to as the AO) issued notice u/s 148 to the assessee. But no details were filed by the assessee

3.

Matter carried to the Ld. CIT(A) and the Ld. CIT(A) dismissed the appeal of the assessee.

4.

During the course of hearing, the Ld. A.R. submitted that assessee did not appear before the AO and before the Ld. CIT(A). Therefore, the matter was dismissed at the level of AO as well as Ld. CIT(A). He further submitted that the assessee’s case was reopened and notice under section 143(2) was issued to the assessee. Assessee firm was in financial mess. Thereafter, assessee did not comply to various notices and AO has called for certain details but assessee could not submit the details and the matter was finalised. Similarly, before the Ld. CIT(A) assessee was unable to submit anything. The assessee has submitted before Tribunal the various documents and affidavit which is by way of paper book from page 1 to 43. Therefore, he submitted that considering this, the appeal may be restored to AO to pass the order afresh after considering all these documents on record and matter may be decided afresh.

5.

The Ld. D.R. objected to it.

6.

We have heard the rival contentions of both the parties. We find that assessee has purchased a land for consideration of Rs.1,25,00,000/- in April, 2006 from Mrs. Raut & Others for development. Thereafter, there was illegal zopadpatti and 3 M/s. Aditya Construction Company encroachment of the property. The assessee firm has to face legal battle against zopadpattiwala tenant and ultimately the financial condition of the assessee was in mess. Therefore, assessee could not reply to show cause notice and he could not remain present before the AO and the Ld. CIT(A). Assessee has produced various documents before us by way of paper book. Therefore, in the interest of justice and fairplay, we restore this matter back to the file of AO and AO is directed to decide the matter afresh and to make a denovo assessment. AO is also directed to give opportunity of hearing to the assessee.

7.

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

Order pronounced in the open court on 26.09.2017.

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