RAJASREE MOTORS PVT LTD,COCHIN vs. ITO CORPORATE WARD 2(2), KOCHI

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ITA 1004/COCH/2022Status: DisposedITAT Cochin23 November 2023AY 2016-17Bench: Shri Sanjay Arora (Accountant Member), Shri Manomohan Das (Judicial Member)3 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal condoned the delay, finding the reasons provided by the assessee to be reasonable and convincing. The ex parte order was set aside as it was passed in violation of the principles of natural justice due to lack of opportunity of hearing.

What were the facts?

The assessee's appeal was filed with a significant delay due to office closures during the Covid-19 pandemic and a lack of communication regarding appellate proceedings. The assessee only became aware of the ex parte order passed by the CIT(A) upon receiving a notice for penalty proceedings.

What were the issues?

Whether the delay in filing the appeal is justifiable and whether the ex parte order passed by the CIT(A) is sustainable without providing the assessee with due opportunity of hearing.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN

Before: Shri Sanjay Arora & Shri Manomohan Das

For Appellant: Shri P.M. Veeramani, CA
For Respondent: Smt. J.M. Jamuna Devi, Sr. D.R
Hearing: 23.11.2023Pronounced: 23.11.2023

O R D E R PerSanjay Arora, AM This is an Appeal by the Assessee directed against the dismissal of it’s appeal contesting it’s assessment u/s.143(3) of the Income Tax Act, 1961 (‘the Act’) dated 29.12.2018 for Assessment Year (AY) 2016-17 by the Commissioner of Income Tax (Appeals), NFAC, Delhi [CIT(A)] vide it’s order dated 10.11.2021.

2.

At the outset, it was observed by the Bench that the instant appeal, filed on 20/12/2022, is with a delay of 355 days. The assessee’s, an authorized sales and service agent for Mercedez Benz cars in Kerala, case, per averments vide a sworn affidavit dated 16/12/2022 by Sri. S. Sivakumar (PAN: ADKPS8197D), Managing Director of the assessee-company, is that it’s office was closed due to Covid-19 pandemic for the earlier part of 2021, with its dealership cancelled and office closed in September, 2021. Further, no communication for hearing was received from the office of the ld.CIT(A), and before whom the proceedings were thus without 1

(AY 2016-17) Rajasree Motors Pvt. Ltd. vs. ITO participation by the assessee. The assessee was accordingly not aware of the appellate proceedings nor indeed of the appellate order dated 10.11.2021, which was, as it was later found, transmitted electronically on the assessee’s portal with ITBA. It was only on receipt, physically, the hearing notice for penalty proceedings u/s 271(1)(c) for the relevant year, that the assessee became aware of the passing of the appellate order on 14.12.2022. The assessee’s account at the Income Tax Portal was accordingly immediately accessed and the impugned order downloaded, filing an appeal with dispatch on 20.12.2022. This explains the delay in filing the delay by 11 ½ months.

3.

We find the reasons of the intermittent closure of assessee’s office for the better half of 2021 and followed by complete closure of office in September, 2021, coupled with non-communication of the appellate proceedings by the office of the first appellate authority, as both reasonable and convincing. No cross examination of the deponent stands preferred by the Revenue, or otherwise any counter-affidavit furnished by it. Under the circumstances, we find the delay as justifiably explained and, accordingly, condoning the delay, admit the appeal.

4.

On merits, as apparent from the mere browse of the impugned order – also referred to by us for the purpose of condonation of delay, makes it abundantly clear that there has been no communication to the assessee by the office of the ld.CIT(A). There is no reference in the impugned order to any notice of hearing issued, much less served, on the assessee. The ex parte order passed, though on merits, is thus without provision of due opportunity of hearing to the assessee and, thus, in violation of the principles of natural justice. Vacating the adjudication per the impugned order, we accordingly set aside the impugned order, restoring the assessee’s appeal back to the file of the ld.CIT(A) for adjudication afresh after hearing the parties before us per a speaking order and in accordance with law. We decide accordingly.

(AY 2016-17) Rajasree Motors Pvt. Ltd. vs. ITO 5. In the result, the assessee’s appeal is allowed. Order pronounced in the open court on November 23, 2023.

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