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Income Tax Appellate Tribunal, DELHI BENCH ‘G’, NEW DELHI
Before: Sh. G. C. Gupta, Hon’ble & Sh. O.P.Kant
Appellant by : Sh. O.P. Sapra, Sr. Adv Respondent by : Sh. Sujit Kumar, Sr. DR Date of Hearing : 01.10.2015 Date of Pronouncement :08.10.2015 ORDER
PER O.PKANT,AM.
This appeal of the assessee is directed against the order dated 12.09.2012 of learned Commissioner of Income-tax (Appeals)- Ghaziabad in respect of assessment year 2009-10, raising following grounds of appeal:- “1. The order of the Commissioner of Income Tax (Appeals) has been passed without providing opportunity and therefore, the order passed ex-parte is against the natural justice and is therefore, contrary to law and is liable to be set aside.
2. The order of the Assessing Officer giving a finding that the assessee is carrying out activities which are not in the nature 2 of charity and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the order is liable to be set aside and the additions made therein are liable to be deleted.
3. The addition of Rs.19,342/- made by the Assessing Officer treating the activity of providing Mid Day Meal being falling with the proviso to Section 2(15) and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the addition is liable to be deleted.
4. The addition of Rs.12,18,938/- on account of receipts as per TDS Certificates of Basic Siksha Adhikari, Jewar Noida and Basic Siksha Adhikari, Hapur and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the addition is liable to be deleted.
5. The addition u/s 68 / 115BBC / 56(l)(vi) of the Income Tax Act, 1961 of Rs.1,00,000/- of donation received by the appellant and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the addition is liable to be deleted.
6. The disallowance of expenditure of Rs.10,90,410/- @ 20% of expenses incurred on vegetable refine etc. and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the addition is liable to be deleted.
7. The disallowance of depreciation of Rs.13,550/- on an amount of Rs.90,332/- paid for sales tax for getting goods released and confirmation of the same by the Commissioner of Income Tax (Appeals) is contrary to facts and law and therefore, the addition is liable to be deleted.”
Facts in brief are as culled out from the orders of lower authorities that that the assessee is a society registered with 3 the Registrar of Society, Uttar Pradesh and filed its return of income for the relevant assessment year on 06.07.2010 declaring NIL income. In the course of scrutiny proceeding, the learned Assessing Officer noticed that the assessee was engaged in the activity of providing mid day meal to various schools. The learned Assessing Officer was of the view that providing mid day meal being a business activity and turnover of the assessee is more than Rs.10 lakh, the income of the assessee was not eligible for exemption. The AO completed the assessment u/s 143(3) of the act on 26.12.2011 in the status of AOP and made following additions: a. Rs.19,342/- as surplus as per income and expenditure account b. Rs.12,18,938/- against short receipt and contract of mid day meal c. Rs.1,00,000/- unexplained donation received u/s 115BBC/56(i)(vi) of the Act, d. Rs.10,90,410/- as unverifiable expenses of vegetables, refine etc., and e. Rs.13,550 being 15% depreciation towards sales tax penalty of goods.
Aggrieved, the assessee filed an appeal before the learned Commissioner of Income-tax (Appeals), Ghaziabad.
4 The learned Commissioner of Income-tax (Appeals) in his order has observed that the assessee did not comply with the various notices issued and served through speed post and therefore decided the appeal ex parte. The relevant para of his order is reproduced as under: “4. This appeal was fixed for hearing on numbers of times, details of which are given below, but no compliance was made to any of notices issued. All these notices were sent to the appellant through speed post on the address given in the appeal petition i.e. form No.35. Sl Date of Date fixed for Remark No. notice hearing 1. 29.05.2012 13.06.2012 None attended 2. 21.06.2012 Refixed for None attended 04.07.2012 3. 21.06.2012 Refixed for None attended 19.07.2012 4. 08.08.2012 Refixed for None attended 17.08.2012 (Last opportunity) 5. 27.08.2012 Refixed for None attended 04.09.2012 (final opportunity) A last opportunity was also provided to the assessee vide notice dated 27.08.2012 fixing the appeal for hearing on 04.09.2012 which was also sent to the appellant through Speed Post on the address given in the appeal memo. Again the assessee made no compliance on the date fixed for hearing i.e. on 04.09.2012 5 4.1 Therefore this appeal is being decided ex-parte, however on merits of material available on record.”
Aggrieved, the assessee is before us.
At the outset the learned Authorized Representative (in short ‘AR’) of the assessee submitted that the assessee has not been provided any opportunity to represent its appeal before the learned Commissioner of Income-tax (Appeals) and order has been passed in violation of natural justice, and therefore, the order is contrary to the law and liable to be set-aside . The ld AR further submitted that the observation of the learned Commissioner of Income-tax (Appeals) that non attended in response to the notice dated 13.06.2012 is factually incorrect, as the assessee has already filed application for adjournment on 11.06.2012. The ld. AR has filed before us a copy of above referred application for adjournment, after obtaining the same from the office of the learned Commissioner of Income-tax (Appeals), along with an affidavit from Sh. Pratap Singh, secretary of the Society, in this respect. In the said affidavit the secretary has averred that adjournment application was duly filed before learned Commissioner of Income-tax (Appeals) and the notices dated 21.06.2012, 08.08.2012 and 27.08.2012, as mentioned in the order of the learned Commissioner of Income-tax (Appeals) were not served 6 either on the assessee or any other persons authorized by the assessee to receive such notice. On the other hand, the learned Commissioner of Income-tax (Departmental Representative) could not controvert the submission of the ld AR.
We have heard the rival submissions and perused the material on record. It is evident from the affidavit and its annexure that the assessee has duly filed application for adjournment before the learned Commissioner of Income- tax (Appeals), and therefore, the finding of the learned Commissioner of Income-tax (Appeals) that non attended on 13.06.2012 is not correct. The notices on the subsequent dates are also found not to be served properly on the assessee as asserted by the secretary of the assessee society in his affidavit. In view of these facts and circumstances, we are of the considered opinion that the assessee has not been provided any opportunity to represent its case, and therefore, following the settled rule of natural justice of “audi alteram partem” according to which nobody should be condemned unheard, we remit the matter back to the file of the learned Commissioner of Income-tax (Appeals) with a direction to provide opportunity of being heard and decide the appeal de novo. Accordingly, Grounds Nos.1 to 7 of the assessee’s appeal are allowed for statistical purposes.