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Income Tax Appellate Tribunal, DELHI BENCH “F”, NEW DELHI
Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI
Date of Hearing: 11-04-2016 Date of Order : 02-05-2016
ORDER PER H.S. SIDHU, JM This appeal by the Assessee is directed against the order of the Ld.
Commissioner of Income Tax (Appeals)-XVII, New Delhi dated 02.1.2014 pertaining to assessment year 2010-11 on the following grounds:-
“On the facts and circumstances of the case the Ld. CIT(A) has erred:-
In confirming the disallowance of Rs. 6,23,149/- u/s. 14A of the Act made by the AO without specifically pointing out the expenses that has been incurred for earning the dividend income and long term capital gains (exempted income) as against Rs. 55,690/- expenditure claimed by the appellant.
2. In not giving cogent reasons for not accepting the claim of the assessee that Rs. 55,690/- expenditure has been incurred by it in relation to the exempt income.
In not establishing nexus or proximate relationship between the expenses disallowed and the exempted income.
4. In not examining the correctness of the claim of the appellant having regard to the accounts of the assessee of the previous year as per the provision of section 14A(2) r.w. Rule 8D of the Income Tax Rule. The appellant craves leave to add, alter, modify, substitute or delete any of the grounds of appeal on or before the date of hearing.”
The facts narrated by the Revenue Authorities are not disputed by both the parties, hence, the same are not being repeated here for the sake of convenience.
3. After hearing both the parties and perusing the orders passed by the Revenue Authorities, we find that the assessee remained non-cooperative before the ld. First Appellate Authority and the Assessee is only taking adjournments and not attending the proceedings. Therefore, the Ld. CIT(A) had decided the issue in dispute against the assessee exparte. The reasons for non-appearance was asked from the Ld. Counsel of the Assessee, Sh. TR Talwar, Advocate who stated that he was not the Authorised Representative of the assessee before the Revenue authorities below, but he assured the Bench that assessee will fully cooperate in the assessment proceedings or in the appellate proceedings, if this Bench taken a lenient view and set aside the issue in dispute to the AO/CIT(A).
On the contrary, Ld. DR strongly objected the request of the assessee’s Counsel and stated that since the assessee remained non-cooperative before the authorities below, hence, is not entitled for any lenient view from this Bench.
After hearing both the parties and perusing the orders of the Revenue Authorities especially the impugned order, we find that the Ld. First Appellate Authority has decided the issue in dispute against the assessee exparte vide para no. 4 & 4.1 at page no. 5 of the impugned order. The contents thereof are reproduced hereunder:-
“4. During the appellate proceedings several opportunities were given to the appellant to appear and give its submissions. The details of notices are as under:-
“The first notice was issued to the appellant on 04.11.2013 fixing the case for hearing on 22.12.2013. The notice was sent by speed post at the address given in the appeal memo which was “7th floor, Kanchenjunga Building, 18, Barakhamba Road, new Delhi – 110 001” at the registered office of the appellant company. On 22.11.2013 the AR of the appellant appeared and asked for adjournment. The case was adjourned to 05.12.2013. On 05.12.2013 no submissions were submitted by the appellant and the letter for adjournment was filed. The case was again adjourned to 26.12.2013 for final hearing. On 26.12.2013 neither the AR of the appellant appeared nor any submission was made and the letter for adjournment was filed. The letter for adjournment was rejected.”
4.1 Since the appellant is only taking adjournments and not attending the proceedings, I am deciding the case exparte on the basis of documents on record and on merit. I shall now deliberate upon the various grounds of appeal.”
6. After going the aforesaid opportunity given by the Ld. CIT(A) to the assessee, we find that the assessee remained non-cooperative before the Ld. First Appellate Authority, but in the interest of justice, we are of the considered view that the substantial right of appeal and for substantiating the assee’es claim cannot be snatched without providing sufficient opportunity to the assessee. Keeping in view of the facts and circumstances of the present case, we are of the view that in the interest of justice, the issue in dispute requires to be set aside to the Ld. First Appellate Authority for fresh consideration.
7. Keeping in view of the statement made by Sh. TR Talwar, Advocate/ Ld. Counsel of the Assessee, we set aside the issue in dispute to the file of the ld. CIT(A) with the directions to decide the same afresh under the law, after giving adequate opportunity of being heard to the assessee, subject to the payment of cost of Rs. 5,000/- (Rupees Five Thousand) which the assessee shall be deposited, as per the instructions of the Ld. CIT(A).
8. The Assessee is directed through Sh. T.R. Talwar, Advocate/Ld. Counsel of the Assessee to appear before the Ld. CIT(A) on 30.05.2016 at 10.00 am to represent the case. There is no need to issue notice to the Assessee because the directions for appearance before the Ld. CIT(A) were issued in the Open Court and the same were noted down by Shri T.R. Talwar, Ld. Counsel of the Assessee.
In the result, the appeal filed by the Assessee stands allowed for statistical purposes.
Order pronounced in the Open Court on 02/05/2016.