MAYFAIR BIOTECH PRIVATE LIMITED,UNA vs. DCIT, CIRCLE, PALAMPUR

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ITA 191/CHANDI/2023Status: DisposedITAT Chandigarh30 April 2024AY 2012-13Bench: SHRI A.D. JAIN (Vice President), DR KRINWANT SAHAY (Accountant Member)5 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal, following a jurisdictional High Court decision, held that service of notice solely on the e-portal might not constitute proper service. Therefore, the case was remitted back to the CIT(A) for a fresh adjudication.

What were the facts?

The assessee's appeal was dismissed by the CIT(A) due to non-compliance, as notices were only uploaded on the e-portal and not physically served. The assessee argued that this lack of proper service meant they were unaware of the proceedings.

What were the issues?

Whether the dismissal of the appeal by the CIT(A) without proper physical service of notice to the assessee was justified, and if the assessee was denied a proper opportunity of hearing.

Which sections of the Income-tax Act were involved?

Section 250,Section 282(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CHANDIGARH BENCH, ‘B’, CHANDIGARH

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

For Appellant: CA राजव क ओर से/
For Respondent: Shri Dharam Vir, JCIT Sr. DR
Hearing: 29.04.2024Pronounced: 30.04.2024

आदेश/Order Per Dr. Krinwant Sahay, A.M.:

1.

The appeal in this case has been filed by the Assessee against the order dated 14.02.2023 of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2012-13 taking the following Grounds of appeal: -

191-Chd-2023 –Mayfair Biotech Private Limited, Una. 2 1. That on the facts, circumstances and legal position of the case, the Worthy CIT(A), NFAC in Appeal No. CIT (A), Palampur/10217/2018-19 dated 14.02.2023 has erred in passing the order u/s 250 of the Income Tax Act, 1961.

2. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) has erred in confirming the addition of Rs. 14,18,842 u/s 40(a)(ia) on account of non-deduction of tax at source on interest paid to Non-Banking Financial Companies.

3. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) has erred in confirming the addition of Rs. 86,208 on account of expenditure related to earlier years paid during the year even when those expenses crustallized during the year and were revenue in nature.

4. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) has erred in confirming the addition of Rs. 2,74,810 made on account of income tax demand debited during the year.

5. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) has erred in confirming the addition of Rs. 5,41,066 made on account of unsecured loans raised by the company from Sh. Anand Ramachandran.

191-Chd-2023 –Mayfair Biotech Private Limited, Una. 3 6. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.

2.

The ld. Counsel of the Assessee filed a submission dated 23.4.2024 along with an affidavit, the relevant portion of the written submissions is reproduced as under:- “3. During the appellate proceedings, notices u/s 250 were issued by the Worthy C1TA), NFAC directing us to file written arguments/submission. However, appellant could not file the submission/adjournment request as the said notices were never served upon the appellant physically but only uploaded on e-portal. On account of non-compliance by the appellant, he presumed that appellant was not interested in prosecuting the appeal.

It was not the case where appellant intentionally did not file response/submission. lt is only because appellant was unaware about the issuance of the above notices by Worthy CIT(A).

5.

In a recent decision by the Jurisdictional Hon'ble P&H High Court in the case of Munjal BCU Centre of Innovation and Entrepreneurship vs. CIT(E) Chandigarh’, CWP No. 21028/2023 dtd. 04.03.2024 it was held that service of notice solely on portal is no service in accordance with the provision of s. 282(1) r.w.r. 127 and assessee can be presumed to have no knowledge of the proceedings,

191-Chd-2023 –Mayfair Biotech Private Limited, Una. 4 Therefore, The Worthy CIT(A) has dismissed the appeal without granting proper opportunity of hearing.”

3.

During the course of hearing, the ld. Counsel of the Assessee once again brought to the notice of the Bench the decision of the Hon'ble jurisdictional Punjab and Haryana High Court in the case of ‘Munjal BCU Centre of Innovation and Entrepreneurship Vs CIT(E) Chandigarh’, CWP No. 21028/2023 dated 4.3.2024 and requested that as the service of notice was solely on portal which could not be seen by the Assessee, therefore, as per the Hon'ble jurisdictional High Court’s decision in the above mentioned case, the Assessee may be presumed to have no knowledge of the proceedings and he further requested for sending this case back to the CIT(A) for re-adjudication.

4.

The ld. DR has no objection as the request of the Assessee’s Counsel was based on the judgement of the jurisdictional Punjab & Haryana High Court (supra).

5. Accordingly, in view of the above, in the interest of justice, the matter is remitted to the file of the CIT(A), to be decided afresh on merit, in accordance with law, on affording due and adequate opportunity of hearing to the Assessee. The Assessee, no doubt, shall cooperate in the fresh proceedings before the CIT(A). All pleas

191-Chd-2023 –Mayfair Biotech Private Limited, Una. 5 available under the law shall remain so available to the assessee. Ordered accordingly. 6. In the result, the appeal of the Assessee is allowed for statistical purposes.

Order pronounced on 30.04.2023.

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