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Facts
The assessee declared Nil income for AY 2018-19. The AO made an addition of Rs. 1,28,35,000/- on corpus donations, as only 16 out of 128 donors responded to the verification unit's notices, which were issued during the Covid-19 period.
Held
The CIT(A) dismissed the appeal ex-parte. The Tribunal, considering the principles of natural justice and the circumstances of Covid-19, decided to provide the assessee with another opportunity to present their case before the AO.
Key Issues
Whether the assessee should be granted another opportunity to substantiate their case given the notices were issued during the Covid-19 period and the appeal was dismissed ex-parte.
Sections Cited
143(3), 144B
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Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI
Before: SHRI GEORGE GEORGE K & SHRI JAGADISH
आदेश / O R D E R
PER JAGADISH, A.M :
Aforesaid appeal filed by the assessee for Assessment Year (AY) 2018-19 arises out of the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] dated 01.10.2024 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) r.w.s 144B of the Income-tax Act, 1961 (hereinafter “the Act”) dated 19.04.2021.
The assessee has filed return of income on 27.07.2018 declaring total income at Nil. During the assessment proceeding, the A.O called for details of the voluntary contributions forming part of corpus amounting to Rs. 5,27,20,000/- and after making enquiry through verification unit noted that only 16 donors have furnished or uploaded their reply . The A.O therefore, made the addition on corpus donation of Rs. 1,28,35,000/- in respect of donors who have not been replied .
Aggrieved, the assessee filed an appeal before Ld. CIT(A). The Ld. CIT(A) has dismissed the appeal ex-parte as the assessee has failed to append any submission or supporting documents in support of its contention.
The Ld. Authorized Representative (A.R) of the assessee before us has submitted that notices for enquiry were issued during Covid-19 period by the AO, due to which some of donors could not upload the confirmation. The Ld. AR further submitted that the Ld. CIT(A) has dismissed the appeal ex-parte and therefore, one more opportunity should be given to substantiate his case.
The Ld. Departmental Representative (DR), on the other hand, has relied on the orders of lower authorities.
We have heard the rival submissions, and perused the materials available on record. The A.O has made the addition in respect of corpus donation only on the ground that some of donors have not replied in response to notices issued by the verification unit. The Ld. AR has submitted that notices were issued during Covid-19 period and therefore, it could not be replied and one opportunity should be given to substantiate his case. The Ld. CIT(A) has also dismissed the appeal ex-parte. We are of the opinion that keeping in view the principles of natural justice, the assessee be provided with another opportunity of hearing to substantiate his case before the A.O.
Accordingly, we set aside the orders passed by the lower authorities and restore the matter back to the file of the A.O for denovo adjudication after giving reasonable opportunity to the assessee. We also direct the assessee to appear before the A.O on the date of hearing without fail. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on 20th December, 2024.