SALOCHAN BIR SINGH,LUDHIANA vs. DCIT, CC-1, LUDHIANA

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ITA 657/CHANDI/2023Status: DisposedITAT Chandigarh11 June 2024AY 2019-20Bench: SHRI A.D.JAIN (Vice President), SHRI KRINWANT SAHAY (Accountant Member)5 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that notices on the e-portal alone are not sufficient for communication, and principles of natural justice require an opportunity of being heard. The case was restored to the CIT(A) for a fresh decision.

What were the facts?

The assessee filed its return of income, and the Assessing Officer assessed the income at a higher amount. The assessee appealed to the CIT(A), but did not respond to multiple notices issued on the ITBA Portal.

What were the issues?

Whether notices issued solely on the ITBA portal are sufficient communication, and if the principles of natural justice were violated by the ex-parte order.

Which sections of the Income-tax Act were involved?

Section 282(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CHANDIGARH

Before: SHRI A.D.JAIN & SHRI KRINWANT SAHAY

For Appellant: Shri P.N.Arora, Advocate
For Respondent: Shri Ved Parkash Kalia, JCIT Sr.DR
Pronounced: 11.06.2024

आदेश/ORDER

PER A.D.JAIN, VICE PRESIDENT

1.

This is assessee's appeal for assessment year 2019-20 against the order dated 31.08.2023 passed by the ld. CIT(A)- 5, Ludhiana [in short ‘the CIT(A)].

2.

The facts of the case are that the assessee is a manufacturer of lifts. The assessee filed its return of income on 31.10.2019 declaring income of Rs.11,28,970/-. The case was selected under manual scrutiny as per CBDT guidelines

ITA 657/CHD/2023 A.Y. 2019-20 2 and statutory notice u/s 143(2) of the Income Tax Act, 1961 was issued on 29.09.2020 electronically on the ITBA Portal.

Thereafter, notice u/s 142(1) of the Act dated 09.09.2021 alongwith detailed questionnaire, was issued to the assessee electronically. Vide questionnaire, the assessee was required to furnish detailed explanation and to produce the invoices/bills viz-a-vis the stock for the valuation of remaining items of the stock inventory prepared during the survey conducted on 30.08.2018. In response, the assessee furnished the reply. The Assessing Officer was not satisfied with the reply/information submitted by the assessee and accordingly, the Assessing Officer assessed the income of the assessee at Rs.21,76,480/-, against which the assessee went in appeal before the ld. CIT(A).

3.

Before the ld. CIT(A), as stated in the impugned order, the assessee was issued as many as ten notices on ITBA Portal for the hearings fixed on 25.05.2022, 22.06.2022, 08.09.2022,04.11.2022,25.11.2022,19.12.2022, 11.01.2023, 19.04.2023, 29.05.2023 and 31.07.2023, but the assessee did not respond to any of the notices issued by the ld. CIT(A). Accordingly, the ld. CIT(A) passed ex-parte order against the assessee and dismissed the appeal of the assessee.

ITA 657/CHD/2023 A.Y. 2019-20 3 4. Aggrieved, the assessee is in appeal before this Tribunal.

5.

We have heard the parties and have perused the material on record. A perusal of the record shows that the assessee was issued a number of notices by the ld. CIT(A) on ITBA Portal. The ld. Counsel for the assessee has submitted that the notices were not viewed by the assessee as the assessee was not aware of issuance of any such notice and further, that the Counsel of the assessee was changed. The ld. Counsel for the assessee has stated that in some notices, including last notice, adjournment was sought, but the ld. CIT(A) dismissed the appeal for non-appearance. The ld. Counsel for the assessee has requested that the impugned order of the ld. CIT(A) be set aside and the assessee be given appropriate opportunity of being heard to present its case.

5.1 It is noticed that the assessee was issued many notices on ITBA Portal by the ld. CIT(A) for filing submissions and supporting documents. The matter now stands covered by the decision of the Hon'ble jurisdictional High Court in the case of ‘Munjal BSU Centre of Innovation

ITA 657/CHD/2023 A.Y. 2019-20 4 and Entrepreneurship, Ludhiana through its authorized signatory Shri Bharat Goyal Vs Commissioner of Income Tax (E), Chandigarh’, in CWP 21028-2023 (O&M), wherein, vide order dated 04.03.2024, their Lordships have held that the provisions of Section 282(1) of the Income Tax Act and Rule 127(1) of the Income Tax Rules, 1962, envisage that it is essential that before any action is taken, a communication of the notice must be in terms of these provisions; that these provisions do not make mention of communication to be “deemed” by placing the notice on the e-portal of the Department; that an pragmatic view has always to be adopted in these circumstances; that an individual or a company is not expected to keep the e-portal of the Department open all the times so as to have knowledge of what the Department is supposed to be doing with regard to the submissions of forms, etc.; and that the principles of natural justice are inherent in the Income Tax provisions and the same are required to be necessarily followed.

5.2 Considering all the facts and circumstances of the case and in the interest of justice, the appeal is restored to the file of ld. CIT(A) to decide the matter afresh in accordance with law after giving reasonable opportunity of ITA 657/CHD/2023 A.Y. 2019-20 5 being heard to the assessee. The assessee, no doubt, shall cooperate in the fresh proceedings before the ld. CIT(A).

6.

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

Order pronounced in the Open Court on 11.06.2024.

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