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Facts
The assessee's appeal for AY 2015-16 arose from an order confirming the disallowance of sales promotion expenses of Rs. 56.89 Lacs. This disallowance was made on a best judgment basis because the assessee failed to furnish a reply or attend appellate proceedings.
Held
Despite the assessee's negligence, the tribunal restored the appeal to the CIT(A) for fresh adjudication in the interest of natural justice. The assessee was directed to properly substantiate its case.
Key Issues
Whether the disallowance of sales promotion expenses is justified when the assessee failed to provide a reply or attend appellate proceedings, and whether the appeal should be restored for de novo adjudication.
Sections Cited
144, 264
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH, CHENNAI
Before: HON’BLE SHRI ABY T. VARKEY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
(िनधा*रणवष* / Assessment Year: 2015-16) Mrs. Ranjithkumar Yogalakshmi ITO बनाम/ #26, Seashell Avenue, Akkarai, Non-Corporate Ward-15(5) Vs. Chennai-600 119. Chennai. �थायीलेखासं./जीआइआरसं./PAN/GIR No. ACPPY-5709-D (अपीलाथ�/Appellant) : (� थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Shri Saroj Kumar Parida (Advocate) - Ld. AR � थ�कीओरसे/Respondent by : Ms. R. Anita (Addl.CIT) - Ld. DR सुनवाईकीतारीख/Date of Hearing : 24-09-2024 घोषणाकीतारीख /Date of Pronouncement : 24-09-2024 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member)
Aforesaid appeal by assessee for Assessment Year (AY) 2015-16 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 30-05-2024 in the matter of assessment framed by the Ld. AO on best judgment basis u/s 144 r.w.s 264 of the Act on 23-12-2017. In the assessment order, Ld. AO disallowed sales promotion expenses of Rs.56.89 Lacs since the assessee failed to furnish any reply. The Ld. CIT(A) confirmed the same since the assessee did not attend appellate proceedings also. Aggrieved, the assessee is in further appeal before us. The limited payer of Ld. AR is to send back the matter back to the file of lower authorities which has been opposed by Ld. Sr. DR.
Though the assessee has remained negligent in substantiating its case, however, keeping in mind the principle of natural justice, we accept the prayer of Ld. AR and restore the appeal back to the file of Ld. CIT(A) for de novo adjudication with a direction to the assessee to substantiate its case forthwith.
The appeal stand allowed for statistical purposes. Order pronounced on 24th September, 2024