VENUS COUNTY DEVELOPERS PVT LTD,LUDHIANA vs. ACIT, CIRCLE-2, LUDHIANA , LUDHIANA

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ITA 702/CHANDI/2023Status: DisposedITAT Chandigarh13 September 2024AY 2011-12Bench: SHRI. VIKRAM SINGH YADAV (Accountant Member), SHRI. PARESH M. JOSHI (Judicial Member)3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) ought to have considered the assessee's reply before passing the order. The impugned order was found to be in violation of the principles of natural justice.

What were the facts?

The assessee is aggrieved by an order passed by the CIT(A) without considering their reply filed before the due date. The assessee also submitted a hard copy of the reply on the same day the order was passed.

What were the issues?

Whether the CIT(A) erred in passing an order without considering the assessee's reply and violating the principles of natural justice. Whether the disallowance under Section 40A(3) was justified.

Which sections of the Income-tax Act were involved?

Section 250,Section 40A(3)

AI-generated summary — verify with the full judgment below

आयकर अपीलीय अिधकरण,च"ीगढ़ "ायपीठ “बी” , च"ीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE "ी िव"म िसंह यादव, लेखा सद" एवं "ी परेश म. जोशी, "ाियक सद" BEFORE: SHRI. VIKRAM SINGH YADAV, AM & SHRI. PARESH M. JOSHI, JM आयकर अपील सं./ िनधा"रण वष" / Assessment Year : 2011-12 Venus County Developers Pvt. Ltd. बनाम The ACIT, 620, Ambay Building, Lakkar Bazar, Circle-2, Ludhiana Ludhiana-141008, Now (5th Floor, Grand Walk Mall, Ferozepur Road, Ludhiana-141210 "ायी लेखा सं./PAN NO: AADCV2580J अपीलाथ"/Appellant ""थ"/Respondent िनधा"रती की ओर से/Assessee by : None (Adjournment Application) राज" की ओर से/ Revenue by : Shri Vivek Vardhan, JCIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 05/09/2024 उदघोषणा की तारीख/Date of Pronouncement : 13/09/2024 आदेश/Order PER PARESH M. JOSHI, J.M. :

This is an appeal filed by the Assessee under section 253 of the Income Tax Act, 1961. The relevant assessment year is 2011-12. The assessee is aggrieved by the order dt. 12/07/2023 passed in appeal No. 10505/2018-19/IT/CIT(A)-5/Ldh/2019-20 under section 250(6) of Ld. CIT(A) which is hereinafter referred to as the impugned order. 2. The assessee has raised following grounds of appeal in Form No. 36 against the impugned order:

1. The Learned CIT (A)-5, Ludhiana erred in passing the order without considering our reply in their record/e-filling portal, filed on 24.06.2023 on E-Portal of Income Tax Department in compliance to the notice under section 250(1) of the Income Tax Act, 1961 dated 20.06.2023, the due date of the notice was 26.06.2023. The assessee filed the reply on 24.06.2023 much before the due date.

2. Further, Assessee Company also submitted the hard copy of the reply along with supporting documents (same as filed on E-Portal) in the office of the CIT (A)- 5, Ludhiana on 12.07.2023, this the same day in which the alleged order had been passed by the Ld. CIT (A)-5, Ludhiana.

3.

The Learned CIT (A)-5, Ludhiana erred in violation of sub-section 6 of section 250 of the Income Tax Act, 1961, by ignoring our reply filed on 24.06.2023 before passing the alleged order dated 12.07.2023.

4.

The Learned CIT (A) erred in passing order without giving reasonable opportunity to the appellant and not on the merit of the case. Thus, principal of natural justice has been contravened by the CIT(A)-5, Ludhiana. 5. The Ld. ClT(A)-5, Ludhiana disallowed payment of Rs. 33,63,555/- incurred on purchase of agriculture land u/s 40A(3) of the the Income Tax Act, 1961, whereas this payment was never debited to Profit & Loss Account and moreover cash payment for purchase of land was not debarred in A.Y which was applicable in subsequent years and the payment fall in exceptional circumstances covered under Rule 6DD of the Income Tax Rules as applicable. 6. The order of commissioner of income tax (appeals) on the above issues raised i n the appeal be set aside and that of assessing officer be resorted to. 7. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same. Record of Hearing

3. The hearing in the matter took place on 05/09/2024 when the Ld AR of the assessee presented an application dt. 03/09/2024 seeking adjournment for 05/09/2024 due to some unavoidable circumstances. Since no reasons were given for seeking adjournment which can said to be legitimate we rejected the same. The Ld. DR then pointed out to us that impugned order is exparte and the Ld. CIT(A) at least should have considered reply dt. 24/06/2023 before passing impugned order. Hence it would be just fair and convenient and in the interest of justice that the impugned order be set aside and matter be send back to the file of Ld. CIT(A) with a direction to consider reply of the assessee which is dated 24/06/2023. Findings and Conclusions

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