BHASIN MOTORS INDIA PVT. LTD.,NEW DELHI vs. ITO WARD-4(4), NEW DELHI

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ITA 3695/DEL/2019Status: DisposedITAT Delhi18 October 2023AY 2012-13Bench: SHRI KUL BHARAT (Judicial Member), SHRI M.BALAGANESH (Accountant Member)5 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A) had decided the appeal ex-parte without considering the merits of the case. Therefore, the Tribunal set aside the CIT(A)'s order and restored the grounds to the CIT(A) for a fresh decision.

What were the facts?

The assessee company's appeal was against an ex-parte order by the CIT(A) for AY 2012-13. The AO had made additions for disallowance of expenditure and unexplained unsecured loans.

What were the issues?

Whether the assessee was denied adequate opportunity of hearing by the CIT(A), leading to an ex-parte order without considering the merits of the case.

Which sections of the Income-tax Act were involved?

Section 143,Section 147,Section 148,Section 250,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI “A” BENCH: NEW DELHI

Before: SHRI KUL BHARAT & SHRI M.BALAGANESH

For Appellant: Shri Vikas Jain, Adv
For Respondent: Shri Kanv Bali, Sr. DR
Hearing: 18.10.2023Pronounced: 18.10.2023

The present appeal filed by the assessee is directed against the order passed by Ld.CIT(A)-2, New Delhi dated 28.02.2019 for the assessment year 2012-13.

2.

The assessee has raised following grounds of appeal:-

1.

“That the order passed U/s 250 is illegal, bad in law and against the principle of natural justice.

2. That the notice issued by the CIT(A) was never received by the appellant and thus order passed against the principle of natural justice. 3. That the notice issued and reassessment order passed U/s 148 is bad in law and without jurisdiction.

4.

That the reason to believe was never framed by the AO and notice issued without any tangible material is illegal bad in law and without jurisdiction and is also based on change of opinion.

5.

That Assessing Officer (Hereinafter to be referred as an AO) has erred in law and on facts in making an addition of Rs.1,71,05,000/- U/s 68 of the Income Tax Act and CIT(A) has erred in law in upholding the addition. 6. That AO erred in law and on facts in adding the loan of Rs.1,71,05,000/- taken from Venezia golf City Pvt Ltd (VGCPL) in the income of the appellant company when the same was returned by the company to VGCPL in the subsequent year. 7. That the appellant company has and creditworthiness of the payer and genuineness of the transaction before the Assessing Officer and as such an AO has erred in law and on facts has disregarded law by making an addition U/s 68 of the Act. 8. That AO has erred in law and of facts in making an addition U/s 68 on the ground that no business activity was carried out by Venezia Golf City Pvt Ltd. 9. Without prejudice to the above, the AO has erred in law and on facts in making double addition as same amount has been taxed in hands of Venezia Golf City Pvt Ltd. 10. That addition of Rs. 3,00,000/- is apparently illegal bad in law and without jurisdiction. 11. That the addition/ disallowance made are illegal, unjust and bad in law and are based on mere surmises and conjunctures and the same cannot be justified by any material on record. 12. That the evidence filed and materials available on record have not been properly construed and judiciously addition /disallowance made is uncalled for.

13.

That the observation made by an AO and subsequently by the CIT(A) are unjust, improper and without any material on record.

14.

The Appellant craves leave to add, amend, alter and/or delete any of the above grounds of appeal

at or before the time of hearing.”

3. Facts in brief of the case are that the assessee is a company duly incorporated under the Companies Act and filed its return of income, declaring total income of INR 1,59,10,073/- on 25.09.2012. The case was re-opened for assessment and the assessment was concluded vide order dated 30.12.2017 u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (“the Act”). Thereby, the Assessing Officer (“AO”) made disallowance of expenditure of INR 3,00,000/- and unexplained unsecured loans amounting to INR 1,71,05,000/-.

4. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who after considering the submissions, dismissed the appeal ex-parte to the assessee.

5. Aggrieved against the order of Ld.CIT(A), the assessee preferred appeal before this Tribunal.

6. At the outset, Ld. Counsel for the assessee submitted that the assessee was not provided adequate opportunity of hearing by Ld.CIT(A). The notices sent by Ld.CIT(A) were not received by the assessee. Therefore, there was a reasonable cause for not attending the appellate proceedings before Ld.CIT(A). He contended that in the interest of principle of natural justice, an opportunity be granted to the assessee for representing its case before Ld.CIT(A).

7. On the other hand, Ld. Sr. DR opposed these submissions and supported the orders of the authorities below. He contended that the assessee itself was negligent for not attending the appellate proceedings before the Appellate Authority. He contended that three opportunities were granted to the assessee and Ld.CIT(A) in para 3 has recorded that no one attended the proceedings on behalf of the assessee.

8.

We have heard Ld. Authorized Representatives of the parties and perused the material available on record. We find that Ld.CIT(A) has decided the issue ex-parte to the assessee. However, Ld.CIT(A) has not adverted the issues on merit and dismissed the appeal of the assessee. Therefore, looking to the facts and material available on record, we are of the considered view that the assessee ought to have given adequate opportunity of being heard. Therefore, the impugned order passed by Ld.CIT(A) is hereby, set aside and the grounds are restored to the file of Ld.CIT(A) to decide it afresh after giving adequate opportunity of being heard to the assessee. Thus, grounds raised by the assessee are allowed for statistical purposes.

9.

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

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