ELANGO ENGINEERING PVT. LTD.,COIMBATORE V. DCIT, CORPORATE CIRCLE-1, COIMBATORE

ITA 314/CHNY/2025

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The case involves Elango Engineering Pvt. Ltd., which had previously sold immovable property and did not disclose the transaction in their return of income. Following a survey, the Income Tax Department reopened the case and assessed a long-term capital gain. The initial assessment was set aside by the Principal Commissioner of Income Tax, leading to a re-assessment that disallowed a deduction under section 54G of the Income Tax Act. The assessee's appeal against this re-assessment was dismissed ex-parte by the CIT(A), prompting the current appeal before the Income Tax Appellate Tribunal. The Tribunal found that the assessee was not given adequate opportunity to be heard and thus restored the case to the CIT(A) for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 313089 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D. KOMALI KRISHNA
• Assessee Lawyers: SURAJ NAHAR; C.A
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice

Judgement Text

" आयकर अपीलीय अिधकरण, ‘सी’ \u000fा यपीठ, चे\u0014ई IN THE INCOME TAX APPELLATE TRIBUNAL , ‘C’ BENCH, CHENNAI \u0016ी मनु क ुमा र िग\u001bर ,\u000fा ियक सद एवं \u0016ी एस . आर . रघुना था , लेखा सद क े सम& BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A.No.314/Chny/2025 (िनधा\u0005रण वष\u0005 / Assessment Year: 2012-13) M/s.Elango Engineering Pvt.Ltd. 10, Green Fields, Puliakulam Road, Coimbatore-641 045. Vs The Deputy Commissioner of Income Tax, Corporate Circle-1, Coimbatore. PAN : AABCV-8485-C (अपीलाथ\u000f/Appellant) (\u0010\u0011यथ\u000f/Respondent) अपीलाथ\u000fक\u0014ओरसे/ Appellant by : Mr. Suraj Nahar, C.A \u0010\u0011यथ\u000fक\u0014ओरसे/Respondent by : Ms. D.Komali Krishna,CIT सुनवाईक\bतारीख/Date of hearing : 24.04.2025 घोषणाक\bतारीख /Date of Pronouncement : 28.04.2025 आदेश आदेश आदेश आदेश / O R D E R PER MANU KUMAR GIRI, JM: The captioned appeal filed by the assessee is directed against the order of the Ld. Ld. Commissioner of Income Tax (Appeals) (NFAC) Delhi [CIT(A)] dated 12.11.2024 for Assessment Year 2012- 13. 2. Brief facts are as follows: The assessee (Formerly known as M/s. IRIS Engineering Industries Ltd. and Ravilla Aerospace Industries Ltd) now known as Elango Engineering Private Ltd., had sold its immovable property to M/s.Lakhshmi Machine Works Ltd. for a consideration of Rs.8.52 crores, which was not disclosed in return of income. During the course of survey u/s.133 of the Act based on the material impounded, the case was reopened u/s.147 of the Act by issuing notice u/s.148 of the Act on the ground that there is an escapement of income chargeable to tax in respect of land sold by the assessee 2 ITA No. 314/Chny/2025 to M/s.Lakshmi Machine Works Ltd. During the course of assessment proceedings, it was noted by the AO that assessee company has received Rs.8.52 crores as sale consideration from M/s.Lakshmi Machine Works Ltd. and computed the long term capital gain at Rs.98,92,494/-. However, the PCIT-1, Coimbatore vide order dated 27.03.2018 u/s.263 of the Act upon review of the case set aside the assessment order to examine the claim of section 54G afresh. Consequently, the AO vide order passed u/s.143(3) r.w.s. 263 of the Act dated 31.12.2018 disallowed the deduction claimed u/s.54G of the Act, as the assessee had ceased its business and there was no continuity in business. 3. Aggrieved, the assessee challenged order of assessment passed u/s.143(3) r.w.s 263 of the Act before the CIT(A). However, the CIT(A) dismissed the appeal ex-parte filed by the assessee. Thus, the assessee is now in appeal before us. 4. We have heard both the parties and perused records. Before us, the ld. Counsel for assessee submitted that assessee has not received notice of hearing and also the CIT(A) has passed an ex- parte order without providing sufficient opportunity of being heard. Therefore, he pleaded that the assessee may be provided an adequate and proper representation time to file evidence and documents, if any, to substantiate his case before the CIT(A). The ld.DR stated that the assessee is habitual defaulter in appearing before the appellate authority hence, no lenient view is to be taken in this case and prayed for dismissal of the appeal. 5. Though, we concur with the submissions of Ld. Sr. DR however, keeping in mind the principle of natural justice and grant 3 ITA No. 314/Chny/2025 another opportunity of hearing to the assessee. We also find that assessee has not represented before the ld.CIT(A) despite notices for the reasons stated above. Therefore, the impugned order is set aside and the appeal is restored back to the file of CIT(A) for fresh adjudication, after affording proper opportunity of hearing to the assessee, subject to cost of Rs.10,000/- which shall be deposited by the assessee within 30 days from the date of receipt of the order to ‘Tamil Nadu State Legal Services Authority’ at Hon’ble High Court of Madras. The proof of the cost deposit will be furnished by the Assessee before CIT(A). The assessee is directed to substantiate its case with all evidence and documents, if any, forthwith without any fail, failing which ld. CIT(A) shall be at liberty to proceed with proceedings on merits as per law. The ld. counsel, who appeared also assured the bench that he will ensure that the assessee will prosecute the case diligently. 6. In the result, the appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 28th April, 2025 Sd/- Sd/- (एस . आर . रघुनाथा) ( मनु क ुमार िग\u001bर ) ( S.R.Raghunatha ) ( Manu Kumar Giri) लेखा लेखा लेखा लेखा सद\u0003य सद\u0003य सद\u0003य सद\u0003य / Accountant Member \u000fाियक सद / Judicial Member चे\u0019ई/Chennai, \u001bदनांक/Date:28.04.2025 DS आदेश क\u0007 \bितिलिप अ\u000eेिषत/Copy to: 1.Appellant 2.Respondent 3. आयकर आयु\u0013/CIT Chennai/Madurai/Coimbatore/Salem 4. िवभागीय \bितिनिध/DR 5. गाड फाईल/GF. "