ARUN KUMAR CHATURVEDI,KANPUR vs. ACIT-3, KANPUR

IN THE INCOME TAX APPELLATE TRIBUNAL, ‘B’ BENCH LUCKNOW BEFORE HON’BLE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.108/LKW/2024 िनधा�रण वष� / Assessment Year : 2013-14 Arun Kumar Chaturvedi 12/9, Vishno Puri Colony, Nawab Ganj, Kanpur. PAN: ABCPC6864F . . . . . . . अपीलाथ� / Appellant बनाम / V/s. Asstt. Commissioner of Income Tax-3 Kanpur . . . . . . . ��थ� / Respondent �ारा / Appearances Assessee by : None [Adjournment Rejected] Revenue by : Mr Sunil Kumar Rajwanshi [‘Ld. DR’] सुनवाई की तारीख / Date of conclusive Hearing : 20/06/2024 घोषणा की तारीख / Date of Pronouncement : 20/06/2024 आदेश / ORDER Per G. D. Padmahshali, AM; This appeal is filed u/s 253(1)(a) of the Income Tax Act [‘the Act’] by the assessee challenging the order of National Faceless Appeal Centre, Delhi [‘NFAC/CIT(A)’] DIN & Order ITBA/NFAC/S/250/2023-24/ 1059274800(1) dt. 02/01/2024 passed u/s 250 of the Act which in turn arisen out of order of assessment dt. 31/03/2016 passed u/s 143(3) of the Act. 2. Briefly stated facts anent to the case are that; 2.1 The assessee contractor is a proprietor of M/s Hi-Tech Controls filed his return of income declaring ₹16,43,890/- for the year under consideration. The case of the assessee was selected for scrutiny by

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Arun Kumar Chaturvedi Vs ACIT ITA No.108/LKW/2024 AY: 2013-14 service of notice u/s 143(2) of the Act. In the event of assessee’s failure to substantiate genuineness of seven sundry creditors viz; M/s Technical Power Corp., M/s Alka & Co., M/s Industrial Casting Corp., M/s Chandra & Co., M/s Puneet Traders, M/s Glorious Electricals and M/s Manoj Contractors etc., the opening balances amounting to ₹1,11,95, 204/- standing payable to such sundry creditors were added to income u/s 41(1) of the Act by holding that such amounts are carried in financial statement as payable even after their cessation. In addition to above, on account of assessee’s failure to deduct tax [‘TDS’] from the contractual payment ₹35,84,108/- made/payable to one of the labour contractors viz; M/s Neelam Construction, the entire amount of expense was disallowed by the Ld. AO u/s 40(a)(ia) of the Act and accordingly determined the total income ₹1,64,23,210/- in variation to income returned by the assessee. 2.2 When aforestated additions and disallowance is assailed in an appeal before first appellate authority, the Ld. NFAC accorded as many as sixteen clear opportunities of being heard to the assessee till dt. 09/11/2023. These all notices however remained un-responded, except a reply in response to notice dt. 01/11/2022 seeking additional time for preparation & submission of written statement/submission. Consequently, in absence of any representation or written submission from the assessee, the Ld. NFAC adjudicated & partly allowed the appeal ex-parte for non-prosecution in line with the observation of Ld. AO.

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Arun Kumar Chaturvedi Vs ACIT ITA No.108/LKW/2024 AY: 2013-14 2.3 Aggrieved assessee brought up this appeal on as many as nine grounds challenging the balance additions & disallowance sustained by the Ld. NFAC. The assessee also challenged the jurisdiction of Ld. AO and action of Ld. NFAC for violation of principle of natural justice. 3. The case was called twice, none appeared at the bequest of the assessee. After primary briefing from the Ld. DR, we deem it fit to reject the adjournment request & proceed to adjudicate the matter ex-parte u/r 24 of ITAT Rules, 1963. 4. At the outset of the hearing, adverting to grounds of appeal the Ld. DR Mr Rajwanshi submitted that, in addition to challenging impugned order for violation of principle of natural, the appellant by ground number seven also challenged the jurisdiction of the Ld. AO first time in present appeal which was never raised before first appellate authority. Solidifying the facts from para 5 placed at page 6-7/13 of the impugned order the Ld. DR expressed no-objection for setting aside the adjudication for remand.

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Arun Kumar Chaturvedi Vs ACIT ITA No.108/LKW/2024 AY: 2013-14 for non-prosecution. However, while adjudicating the issue ex-parte the Ld. NFAC partly allowed the appeal of the appellant by fully deleting the additions made against the balances relating to M/s Chandra & Co., and M/s Puneet & Co. and further relief was also granted by partially deleting like additions made in the case of M/s Technical Power Corp., M/s Glorious Electricals and M/s Manoj Contractors etc. Against these partial relief the Revenue is not in appeal. Thus, present dispute leaves with balance addition sustained by the Ld. NFAC. 6. Having considered the facts and circumstances of the case, in the larger interest of justice, without disturbing the partial relief granted in first round of appeal, we deem it fit to set-aside the impugned order and remit the matter back to the NFAC with a direction to deal with two bullet issues viz; (a) legal ground raised challenging the jurisdiction of Ld. AO (b) balance addition sustained.

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