SURESH KUMAR BACHIRAJU,KUKATPALLY vs. INCOME TAX OFFICER, WARD-11(1), HYDERABAD

The grounds raised by the assessee read as under:

3. The ld. CIT(A) ought to have considered the fact that the order passed by the Assessing Officer, based on which the notice u/s 274 was issued, was set-aside by the Principal CIT and such order does not exist. 4. The ld. CIT(A) ought to have seen that no penalty can be levied when the assessment order is set-aside by the Principal CIT. 5. The CIT(A) erred in holding that there is any concealment of the particulars of income and further erred in confirming the action of the Assessing Officer in levying penalty u/s 271(1)(c) of Rs.30,36,054/-. 6. The ld. CIT(A) ought to have considered the fact that the difference arose because of application of section 50C of the Act and not either because of concealment of income or furnishing of inaccurate particulars of income. 7. Any other ground may be raised at the time of hearing.”

Facts of the case, in brief, are that the assessee being an individual derived income from real estate business. On the basis of the information gathered, the Assessing Officer noticed that the assessee along with one Mr. K. Gopal Reddy sold a plot of land admeasuring 4 acres on 9.11.2011 for a total consideration of Rs.7,14,00,000/- as his proportionate share. The fair market value of the said land as per the stamp duty authorities was Rs.11,61,60,000/-. It was further noticed that the assessee neither filed the return of income nor paid any capital gain tax on the said transaction. Therefore, the assessment has been reopened u/s 147 of the Act and the assessment has been completed u/s 143(3) r.w.s. 147 of the Act on 26.12.2017 by assessing the total income at Rs.1,03,18,750/-. Thereafter, the Assessing Officer initiated penalty proceedings u/s 271(1)(c) of the Act and after considering the relevant submission of the assessee passed the order imposing penalty u/s 271(1)(c) of the Act and levied penalty of Rs.30,36,054/- being 100% of the amount of tax sought to be evaded for concealment of particulars of income. The assessee carried the matter in appeal before the first appellate authority but neither appeared nor filed any details. Therefore, the learned CIT (A) disposed off the appeal filed by the assessee ex-parte and upheld the levy of penalty u/s 271(1)(c) for concealment of income.

Aggrieved with such order of the learned CIT (A) the assessee is in appeal before the Tribunal.

The learned Counsel for the assessee submitted that the learned CIT (A) erred in deciding the appeal ex-parte without providing proper opportunity of hearing contrary to the principles of natural justice. Therefore, he submitted that the matter may be set aside to the file of the learned CIT (A) to give one mor opportunity of being heard to the assessee.

The learned DR, Smt. Sheetal Sarin, on the other hand, supporting the order of the learned CIT (A) submitted that when the assessee is not seriously prosecuting their appeals with utmost care, then the appellate authorities left with no choice but to dispose of the appeal filed by the assessee on the basis of material available on record. Therefore, there is no reason to set aside the order of the learned CIT (A) go give one more opportunity of hearing to the assessee.

We have heard both the parties, perused material available on record and gone through orders of the authorities below. The learned CIT (A) disposed of the appeal filed by the assessee when the appellant was not appearing and filing the necessary details, even though number of opportunities were given to the assessee to justify its case. But, such appeal has been disposed of on technical rules without considering the issues involved on merit. It is a well-established principle of law by the decision of the various Courts that, even in a case of non- appearance of the appellant, the appeals should be disposed of on merit on the basis of material available on record. Since the learned CIT (A) has dismissed the appeal filed by the assessee on technical ground for non-prosecution, in our considered opinion, the matter needs to be set aside to the file of the learned CIT (A) to give another opportunity of hearing to the assessee. Thus, we set aside the order of the learned CIT (A) and restore the issues to the file of the learned CIT (A) for fresh adjudication. The learned CIT (A) is directed to reconsider the issues after providing reasonable opportunities of being heard to the assessee. Needless to say, the assessee shall appear before the first appellate authority without seeking any adjournment under any pretext.

In the result, appeal filed by the assessee is allowed for statistical purposes.