What did the Tribunal hold?

The Tribunal found that the CIT(A) failed to decide the issues on merits and should have considered the assessee's written submissions. The impugned order was set aside, and the matter was restored to the CIT(A) for a decision on merits.

The assessee's appeal before the CIT(A) was dismissed ex-parte for non-representation, despite written submissions being filed. The assessee also contested the disallowance of interest paid on alleged interest-free advances.

What were the issues?

Whether the CIT(A) erred in passing an ex-parte order without considering written submissions and the merits of the disallowance of interest on alleged interest-free advances.

Sh. Krishan Gopal, Ludhiana vs ITO | ITAT Chandigarh 2018

आदेश/Order

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the against the order dated 16.3.2018 of the Commissioner of Income Tax (Appeals)-3, Ludhiana [hereinafter referred to as CIT(A)].

The assessee in this appeal has not only agitated the action of the CIT(A) in passing the ex-parte order without considering the written submissions filed by the assessee but has also agitated confirmation of disallowance of interest paid on alleged interest free advances.

ITA No. 667/ Chd/2018- Sh. Krishan Gopal, Ludhiana 2

The contention of the Ld. Counsel for the assessee is that the

assessee had own sufficient funds to meet those interest free advances. The

Ld. counsel, at this stage, has stated that though the amount of

disallowance of interest has been mentioned in the first ground of appeal

as Rs. 2,62,603/-, however, another disallowance of interest of Rs.

1,97,536/- inadvertently has remained to be included while agitating the

action of the CIT(A) in confirming the aforesaid disallowance.

We have gone through the impugned order of the CIT(A) and found

that though the assessee had filed written submissions before the Ld.

CIT(A), even the Ld. CIT(A) has reproduced the aforesaid written

submissions in the impugned order, however, the Ld. CIT(A) without

deciding the issue on merits has simply dismissed the appeal of the

assessee for non-representation. We, therefore, agree with the contention

of the Ld. Counsel for the assessee that the assessee had filed written

submissions before the Ld. CIT(A) and the Ld. CIT(A) ought to have

considered the same.

In view of this, the impugned order of the CIT(A) is set aside and the

matter is restored to the file of the CIT(A) with a direction to decide the

grounds / issues raised before us i.e. regarding the disallowance of interest

of Rs. 2,62,603/- and further disallowance of Rs. 1,97,586/- on account of

interest free advances given by the assessee. The Ld. CIT(A) will give

proper opportunity of hearing to the assessee, consider the submissions, if

any, filed before him and then to decide the appeal of the assessee on

merits.

ITA No. 667/ Chd/2018- Sh. Krishan Gopal, Ludhiana 3

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 16.11.2018

Sd/- Sd/- (अ�नपूणा� गु�ता / ANNAPURNA GUPTA) (संजय गग� / SANJAY GARG) लेखा सद�य/ Accountant Member �या�यक सद�य/ Judicial Member Dated : 16.11.2018 “आर.के.”

आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File

आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar

SH. KRISHAN GOPAL,LUDHIANA vs. ITO, W-6(4), LUDHIANA

What did the Tribunal hold?

What were the facts?

What were the issues?

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