THE FEDERATION OF SERICULTURISTS AND SILK WEAVERS COOPERATIVE SOCIETIES LTD,GUNTUR vs. ASSIATANT COMMISSIONER OF INCOME TAX, CIRCLE-1(1), GUNTUR
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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM
Before: SHRI DUVVURU RL REDDY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
PER DUVVURU RL REDDY, Judicial Member :
This appeal filed by the assessee is against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“Ld. CIT(A)-NFAC”] in DIN & Order No. ITBA/NFAC/S/250/2023-24/1062678191(1), dated 15/03/2024 arising out of the order passed U/s. 147 r.w.s 144 of the Income Tax Act, 1961 [“the Act”] for the AY 2014-15.
2 2. Briefly stated the facts of the case are that the assessee is a Cooperative Society registered under Andhra Pradesh Cooperative Societies Act, 1961 undertaken by the Government of Andhra Pradesh. For the AY 2014-15 the assessee had not filed its return of income. During the assessment proceedings, the Ld. AO observed that the assessee had done certain transactions with PAN No. AACFT0220D and therefore the Ld. AO was of the opinion that the income chargeable to tax has escaped assessment and accordingly notice U/s. 148 of the Act was issued on 30/03/2021 and accordingly the proceedings U/s. 147 of the Act were taken up by the Faceless Assessment Unit (NaFAC). However, the case was sent back U/s. 144B(8) of the Act to the Ld. AO’s office mentioning the category “the assessee had duplicate PAN”. Accordingly, the case was taken up for scrutiny by the Ld. AO and the Ld. AO verified the disputed transactions with regard to the books of accounts maintained by the assessee. Before the Ld. AO, initially, it was submitted by the assesse that the assessee-society has, inadvertently, applied for PAN under the category “Partnership Firm”. Accordingly, the assessee-society was allotted the PAN: AACFT0220D. After realizing the mistake committed, the assessee-society has applied for new PAN in the status of “society” and another PAN was
3 allotted ie., AADAT5457C. Thereafter, the assessee-society considering all the transactions involved, filed its return of income with the PAN: AADT5457C. It was also submitted by the assessee before the Ld. AO that the assessee-society has filed its return of income for the AY 2014-15 and was also scrutinized U/s. 143(3) of the Act and order was also passed on 12/08/2016 a copy of which was filed before the Ld. AO. After considering the submissions of the assessee and on examination of the transactions basing on which the assessment was reopened along with the books of accounts of the assessee, the Ld. AO made two additions ie., (i) difference in cash deposits of Rs. 4,31,69,094/- and (ii) Interest income of Rs. 17,27,315/- as the same was not offered for tax. Thus, the Ld. AO, determined to total income at Rs. 4,48,96,409/- and passed the assessment order U/s. 147 r.w.s 144 of the Act, dated 29/11/2021. Aggrieved by the order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A)-NFAC.
On appeal, the Ld. CIT(A)-NFAC, in the absence of any submissions / documents and also considering that there was no response on behalf of the assessee the Ld. CIT(A)-NFAC, dismissed the appeal of the assessee ex-parte and confirmed the
4 additions made by the Ld. AO. Aggrieved by the order of the Ld. CIT(A)-NFAC, the assessee is in appeal before us by raising the following grounds of appeal:
“1. The order of the Ld. CIT(A) is contrary to the facts and also the law applicable to the facts of the case. 2. The Ld. CIT(A) is not justified in dismissing the appeal ex- parte without granting sufficient opportunity to the appellant. 3. The Ld. CIT(A) ought to have deleted the addition of Rs. 4,31,69,094/- made by the Assessing Officer towards alleged unexplained cash deposits in the bank accounts of the appellant. 4. The Ld. CIT(A) ought to have held that the Assessing Officer erred in disallowing interest of Rs. 17,27,315/-. 5. The Ld. CIT(A) ought to have directed the Assessing Officer to grant credit for TDS of Rs. 5,54,260/-. 6. The Ld. CIT(A) ought to have directed the Assessing Officer to grant set-off of loss of Rs. 64,80,224/- admitted by the appellant in the return of income. Any other grounds may be urged at the time of hearing.” 7.
At the outset, the Ld. Authorized Representative [“Ld. AR”] submitted before us that the Ld. CIT (A)-NFAC has passed ex-parte order without providing proper opportunity to the assessee of being heard. It was therefore pleaded that the matter may be remitted back to the file of the Ld CIT (A)-NFAC in order to provide one more opportunity to the assessee of being heard.
5 Ld. Departmental Representative [“Ld. DR”], on the other hand, vehemently opposed to the submissions of the Ld. AR and argued that several opportunities had been provided to the assessee however, on the given dates of hearing, neither the assessee nor her Representative has responded to the notices issued nor filed any details / submissions as called for by the Ld. CIT (A)-NFAC. It was further submitted that, under these circumstances, the Ld. CIT (A)-NFAC had no other option but to pass ex-parte order based on the materials available on record. Hence, it was pleaded that the order passed by the Ld. CIT(A)-NFAC does not call for any interference.
We have heard the rival submissions and carefully perused the materials on record. On examining the facts of the case, we find that the Ld. CIT (A)-NFAC had posted the case on several occasions. However, there was no response on behalf of the assessee before the CIT(A)-NFAC on the dates of hearing with regard to the details / submissions as called for by the Ld. CIT(A)-NFAC. Therefore, the Ld. CIT (A)-NAFC was left with no other option except to adjudicate the appeal ex-parte and dismissed appeal in-limine. In this situation, considering the issues involved in the appeal, we are of the considered view that the Ld. CIT(A)-NFAC ought to have decided the case on merits instead of dismissing the appeal in- limine. However, considering the prayer of the Ld. AR, and in the interest
6 of justice, we hereby remit the matter back to the file of Ld. CIT (A)-NFAC in order to consider the appeal afresh and decide the case on merits by providing one more opportunity to the assessee of being heard in accordance with the principles of natural justice. At the same breath, we also hereby caution the assessee to promptly co-operate before the Ld. CIT (A)-NFAC in the proceedings failing which the Ld. CIT (A)-NFAC shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on the record. It is ordered accordingly.
In the result, appeal filed by the assessee is allowed for statistical purposes as indicated hereinabove.
Pronounced in the open Court on 25th July, 2024. Sd/- Sd/- (एस बालाकृ�णन) (दु�वू� आर.एल रे�ी) (S.BALAKRISHNAN) (DUVVURU RL REDDY) लेखा सद�य/ACCOUNTANT MEMBER �याियकसद�य/JUDICIAL MEMBER Dated :25/07/2024 OKK - SPS आदेश की �ितिलिप अ�ेिषत /Copy of the order forwarded to:- 1. िनधा�रती/ The Assessee – The Federation of Sericulturists and Silk Weavers Cooperative Societies Limited, D.No. 26-39-121/19, Sai Nilayam, Sri Ram Nagar Main Road, Ward Sachivalayam 93 Compound, A.T. Agraharam, Guntur-522004, Andhra Pradesh. 2. राज�व/The Revenue – The Asst. Commissioner of Income Tax, Circle-1(1), O/o. ITO, CR Building, Kannavari Thota, Guntur, Andhra Pradesh-522001. 3. The Principal Commissioner of Income Tax,
7 4. आयकर आयु� (अपील)/ The Commissioner of Income Tax (Appeals), 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, िवशाखापटणम/ DR, ITAT, Visakhapatnam 6. गाड� फ़ाईल / Guard file आदेशानुसार / BY ORDER
Sr. Private Secretary ITAT, Visakhapatnam
