KVR VCPL JV,VIJAYAWADA vs. ACIT, CIRCLE-2(1), VIJAYAWADA

1. This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No. ITBA/NFAC/S/250/2023-24/1060280673(1) dated 30.01.2024, arising out of order passed u/s 270A of the Income Tax Act, 1961 (in short ‘Act’) dated 23.09.2022 for the Assessment Year (A.Y.) 2017-18. KVR VCPL, JV, Vijayawada

Brief facts of the case are that the assessee firm engaged in execution of contract works, did not file it's return of income for the Asst.Year 2017-18 and on observation of the same, a notice u/s. 148 of the Act was issued on 23.03.2021. Accordingly in response to the notice issued, the assessee firm filed return on 18.02.2022, declaring a taxable income of Rs.97,11,940 /-. Subsequently, notices u/ s. 143 (2) and 142(1) of the Act were issued by the NFAC and the assessee firm submitted requisite information before the NFAC. After examining such information, the NFAC finalised the assessment u/s.147 r.w.s. 144B of the Act on 25.03.2022, accepting the income returned. The Assessing Officer (AO) while completing the assessment, initiated penalty proceedings u/s 270A of the Act for under reporting of income by the assessee firm. As it is observed that no explanation has been filed by the assessee firm in respect of the penalty proceedings initiated, the penalty proceedings were transferred and assigned to the jurisdictional Assessing Officer and after affording a reasonable opportunity under the provisions of section 129 of I.T. Act, levied penalty of Rs.15,00,495/-.

Aggrieved by the order of the AO, the assessee preferred an appeal before the CITIAJ and the Ld.CIT(A) dismissed the appeal of the assessee for non-compliance to various notices issued by the Ld.CIT(A).

Aggrieved by the order of the Ld.CIT(A), the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal :

The order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi is erroneous and opposed to the facts of the case and law.

Per contra, the Ld.DR argued that the assessee was given sufficient opportunities, but the assessee firm did not comply with the notices issued, hence, the Ld..CIT(A) is justified in dismissing the appeal of the assessee firm. The Ld.DR, therefore, pleaded to uphold the order passed by the Ld.clr(AJ and dismiss the appeal of the assessee.

We have heard both the parties and perused the material available on record. It is undisputed fact that the assessee firm filed it's return of income on 18.02.2022, which was accepted and the assessee firm made the payment of entire taxes. As submitted by the Ld.AR, the assessee firm could not comply with the notices issued by the department and failed to furnish written submissions due to the unavoidable reasons. He, pleaded for an opportunity of being heard before the Ld.CIR(A) to substantiate it’s case in support of it’s claim, in the interest of justice. In view of the foregoing facts and circumstances of the case and in order to meet the KVR VCPL, JV, Vijayawada principles of natural justice, we are inclined to remit the matter back to the file of the Ld.CIT(A) with a direction to afford an opportunity of being heard to the assessee before the Ld.CIT(A). The assessee is also directed to adhere to the notices issued and cooperate with the department during the proceedings. Accordingly, the grounds raised by the assessee are allowed for statistical purpose.

In the result, appeal of the assessee is allowed for statistical purpose.