GENESIS ORGANICS PRIVATE LIMITED,VADODARA vs. THE INCOME TAX OFFICER, WARD-1(1)(3), VADODARA

Heard both the parties. Case files perused.

It emerges from a combined perusal of both the instant files that this is second round of litigation between the parties qua allowability of the impugned research and development expenses before the tribunal. The Assessing Officer had framed regular assessments on 28/11/2007 and 02/12/2008 disallowing the above research and development expenses claimed as revenue expenditure. The CIT(A) confirmed the same in his separate first round lower appellate orders; both dated 17/09/2010. The assessee then preferred ITA Nos.3160 and 3472/Ahd/2010 before this tribunal. A coordinate bench’s common order dated 25/06/2012 therein restored the issue back to the Assessing Officer for factual verification.

The Assessing Officer took up consequential proceedings. We find from his identical assessment orders that he reiterated his findings in first round that the expenses in question are not genuine since claimed after inflation of bills in the nature of routine expenses. He therefore

The Assessee preferred appeal. We find from CIT(A)’s identical lower appellate orders under challenge that he issued four notices of hearing on 20/09/2016, 07/11/2016, 14/12/2016 and 06/01/2017 which stood returned with “Left ” remarks. This made the CIT(A) to pass the impugned ex-parte orders once again confirming the impugned disallowances.

We have considered rival submissions reiterating respective stands of the parties. It emerges that the assessee’s address given in the CIT(A)’s orders has been changed to the one submitted in the instant appellate proceedings. It is not in dispute that the CIT(A) could not succeed in serving the assessee about a single notice of the lower appellate proceedings because of the above address change. We therefore observe that the assessee’s non-appearance before the CIT(A) could neither be termed as intentional nor deliberate. We accordingly deem it appropriate in the larger interest of justice that the learned CIT(A) needs to re-adjudicate the entire issue as per law after affording three effective opportunities of hearing to the assessee. The assessee’s soul substantive ground in both these appeal is taken as accepted for statistical purposes.

In the result, both the appeals of the assessee are allowed for statistical purposes. This Order pronounced in Open Court on 27/11/2017