AMAN AGARWAL,FARIDABAD vs. DCIT, FARIDABAD

Following grounds have been raised in this appeal: “1. That the order of Learned Commissioner of Income Tax (Appeals) - Faridabad is bad in law and on facts.

2. That on the facts and in the circumstances of the case, the Learned Commissioner of Income Tax (Appeals) erred in: a) Denying a reasonable opportunity of being heard to the appellant by passing the Order under section 250 (6) on 02-12-2014 without waiting for the date fixed for hearing for 11-12-2014. b) Failing to recall his above Order despite a request made in writing on 11-12-2014.

The facts of the case in brief are that a search warrant u/s 132(1)(A) of the Income Tax Act, 1961 was issued by the ADI(Investigation), Unit-1, Dehradun to the assessee under the instruction of Election Expenditure Monitoring issued by Election Commission of India vide instruction dated 13.06.2011 during the State Assembly Election, 2012 in Uttarakhand. The static Surveillance Team intercepted a vehicle Honda Accord HR-29Y 5264 on 11.01.2012 and search operation was conducted on the assessee and his aforesaid vehicle. During the course of search of this vehicle some relevant books, documents and cash were seized and impounded. The statement of the assessee was also recorded, thereafter, the AO issued a notice u/s 153A of the Act. In response to the said notice, the assessee declared an income of Rs.11,52,400/- comprising income from salary and interest. The AO asked the assessee to give the explanation about the source of 3 Aman Aggarwal cash of Rs.6,00,000/- which he was carrying. The AO was not satisfied with the explanation given by the assessee that the amount was withdrawn from the banks. He made the addition of Rs.6,00,000/-.

Being aggrieved the assessee carried the matter to the ld. CIT(A) who passed the ex-parte order and confirmed the addition made by the AO by observing in para 3 of the impugned order as under: “3. During the course of appellate proceedings, a number of opportunities were provided to the appellant, but they remained un-complied with. The first notice u/s 250 of the Income Tax Act was issued on 17.10.2014 fixing the hearing on 10.11.2014. On 10.11.2014 Sh. Karan Nagpal, article O/o M/s SPMR & Associates attended and sought adjournment and the case was adjourned to 25.11.2014. On 12.11.2014, none attended nor any written submissions were filed. This shows that the appellant had no material to substantiate the fact that the addition made by the AO without any basis.”

Now the assessee is in appeal. The ld. Counsel for the assessee submitted that no opportunity of being heard was provided to the assessee and the case was not decided on merit. It was also stated that no notice of hearing was served upon the assessee.

In his rival submissions the ld. DR supported the order of the ld. CIT(A).

I have considered the submissions of both the parties and carefully gone through the material available on the record. In the present case, it is noted from the observations made by the ld. CIT(A) in para 3 of the 4 Aman Aggarwal impugned order that the case was adjourned for hearing on 25.11.2014. However, the ld. CIT(A) mentioned that none attended nor any written submissions were filed on 12.11.2014. It is not clear as to whether the case was adjourned to 25.11.2014 or to 12.11.2014 when the assessee did not appear. Moreover, the ld. CIT(A) sustained the addition by reproducing the observation of the AO and did not give his own findings on merit. In the present case, no opportunity of being heard was given to the assessee, therefore, there was violation of the natural justice. It is well settled that nobody should be condemned unheard as per the maxim “audi alteram partem”. I, therefore, deem it appropriate to remand this case back to the file of the ld. CIT(A) to be decided afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee.

In the result, the appeal filed by the assessee is allowed for statistical purposes. (Order Pronounced in the Court on 31/08/2016)