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Income Tax Appellate Tribunal, “A” BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI S. JAYARAMAN
आदेश /O R D E R
PER S. JAYARAMAN, ACCOUNTANT MEMBER:
These are the appeals filed by the assessee against the orders of the Commissioner of Income Tax (Appeals)-6, Chennai against the assessment order and the penalty order of assessment year 2012-13 in & 262/CIT(A)- 6/15-16 dated 16.09.2016, respectively.
:-2-: I.T.A. N0s. 3216 & 3217/Mds/2016
In the assessment made u/s. 143(3) r.w.s. 144 for assessment year 2012-13, the Assessing Officer added the unsecured loan at Rs. 17.33 crores, as the assessee could not prove the identity of the creditor, genuineness of the transaction and creditworthiness of the creditor and assessed 8% of the turnover as income, after reducing the income admitted from it under best judgement as none appeared on behalf of the assessee. Aggrieved, the assessee filed an appeal before the CIT(A).
The CIT(A) relying on the Supreme Court decision in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors reported in 167 ITR 471 (SC) condoned the delay in filing the appeal. However, he found that the assessee being not serious in persuing its appeal, dismissed the appeal. Aggrieved against that order, the assessee is in appeal in ITA No. 3216/2016.
The AO levied penalty u/s. 271(1)(c) by an order dated 28.09.2015.
Aggrieved against that order the assessee filed an appeal before the CIT(A). While condoning the delay in filing the appeal, the CIT(A) dismissed the appeal on the same reason for which he dismissed the quantum appeal. Aggrieved against that order, the assessee filed the appeal in ITA No. 3217/Mds/2016. Since, both of them are interconnected, they are heard together and disposed off together in this order for the sake of convenience.
The AR invited our attention to the affidavit filed for seeking condonation of delay in filing the appeals which was reproduced by the CIT(A) in his orders and pleaded that there was dispute and difference between the directors/shareholders,
:-3-: I.T.A. N0s. 3216 & 3217/Mds/2016 they were on logger heads etc., and there was no representative on behalf of the assessee. In such facts and circumstances, the CIT(A) erred in giving a short notice during the first hearing and a time of one day during the final hearing to the assessee who has to come from Hyderabad and adjourned the date of hearing from 24.06.2016 to 15.07.2016, sumoto, which was not convenient to the appellant and hence, no proper opportunity was given to the assessee. On the other hand, the DR invited our attention to Para 4.1/4.2 of the orders of CIT(A), which are similarly worded and hence para 4.1 is extracted as under:
“4.1 Notice under ITNS 37 was sent to the appellant on 10.05.2016 fixing the hearing on 27.05.2016. On 27.05.2016 an adjournment was filed by the counsel for the appellant. Thereafter the case refixed by issuing ITNS 37 on 30.05.2016 fixing the hearing on 24.06.2016. There was no compliance on 24.06.2016. In view of the principles of natural justice a third opportunity was given to the appellant company hearing by fixing the hearing on 15.07.2016. Again, there was no compliance from the appellant company however the written adjournment petition was filed in this office on 18.07.2016 i.e., after the date of hearing post facto. Accepting the appellant company request, yet another was given by ITNS 37 dated 06.09.2016 fixing hearing on 15.09.2016. On 14.09.2016 yet another adjournment petition has been filed seeking another adjournment.” and submitted that the CIT(A) has given adequate opportunity. The AR pleaded that the notice fixed for hearing on 15.09.2016 was not served till 14.09.2016 and the representative has to come from Hyderabad. However, the CIT(A) passed orders on 16.09.2016 and hence there was no opportunity of being heard to the assessee.
:-4-: I.T.A. N0s. 3216 & 3217/Mds/2016
We heard the rival submissions. On the facts and circumstances, we are of the view that in the interests of justice, the assessee should be given a reasonable opportunity of being heard. In view of that, we set aside the order of the CIT(A) in dated 16.09.2016 and remit the issue back to the AO for fresh assessment after affording adequate opportunity to the assessee. We also direct the assessee to comply with the requirements of the AO in accordance with law. In the result, the assessee’s appeal is allowed. Since, the quantum appeal is allowed, on similar grounds, the CIT(A) order in ITA No. 262/CIT(A)-6/15-16 dated 16.09.2016 on the penalty order is set aside and the issue is remitted back to the AO for afresh consideration.
In the result, the assessee’s appeal in is allowed and the assessee’s appeal in ITA No. 3217/Mds/2016 is treated as allowed for statistical purposes.
Order pronounced on Wednesday, the 26th day of July, 2017 at Chennai.