HARICHAND RAJKUMAR,CHENNAI V. ITO, NCC-7(1), CHENNAI

ITA 2726/CHNY/2024

AI Insights

This case involves an appeal by Shri Harichand Rajkumar against the order of the Learned Commissioner of Income Tax (Appeals), which was passed ex-parte. The appellant contended that despite uploading relevant documents and submissions, the CIT(A) disregarded these and passed an order without considering the merits. The Assessing Officer also passed an assessment order without appreciating that the assessee had exited from the firm prior to the transactions in question. The Tribunal noted the technical glitches that prevented the assessee from uploading necessary documents during the assessment proceedings and cited the Supreme Court's decision in TIN Box Company v. CIT to emphasize the need for a fair hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 107217 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2019-2020
• Other Referred Cases: TIN Box Company v. CIT [2001] 249 ITR 216 (SC)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.ANITA
• Assessee Lawyers: J. SARAVANAN
• Keywords: Set aside

Judgement Text

"आयकर अपीलीय अिधकरण, ‘सी’ \u000eा यपीठ, चे\u0013ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI \u0016ी एबी टी. वक\u001b, \u000eा ियक सद\u001d एवं \u0016ी जगदीश, लेखा सद\u001d क े सम$ BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2726/Chny/2024 िनधा &रण वष&/Assessment Year: 2019-20 Shri Harichand Rajkumar, 109, General Petters Road, Mount Road, Chennai – 600 002. [PAN: AAFPR 4285H] Vs. The Income Tax Officer, Non-Corporate Circle 7(1), Chennai. (अपीला थ\u001b/Appellant) ()*थ\u001b/Respondent) अपीला थ\u001b की ओर से/ Appellant by : Shri J. Saravanan, Advocate )*थ\u001b की ओर से /Respondent by : Ms. R. Anita, Addl.CIT सुनवा ईकीता रीख/Date of Hearing : 16.01.2025 घोषणा कीता रीख /Date of Pronouncement : 14.02.2025 आदेश / O R D E R PER ABY T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)-/NFAC, Delhi (hereinafter in short ‘the Ld.CIT(A)’), dated 18.10.2024 for the Assessment Year (hereinafter in short ‘AY’) 2019-20. 2. At the outset, the Ld.AR of the assessee drew our attention to impugned order of Ld.CIT(A)/NFAC and contended that the First Appellate Authority has passed an ex-parte order, even though assessee has uploaded written submission and relevant documents to support the ITA No.2726/Chny/2024 (AY 2019-20) Shri Harichand Rajkumar :: 2 :: grounds of appeal raised before him. In order to buttress his ground that he has uploaded the written submission and relevant documents, he drew our attention to acknowledgment receipt of income tax Forms which shows that assessee had uploaded eight (8) documents including the statement of fact, grounds of appeal, details of civil proceedings, CSR report, etc. However according to Ld.AR, the Ld.CIT(A) has brushed aside the same and passed an ex-parte order, without considering the merits of the submission made by the assessee. Further, the Ld.AR contended that the AO erred in passing the assessment order without appreciating that assessee had exited from the Firm on 17.08.2018 by selling his stake to the other partners in the Firm and has erroneously added the transactions of the Firm by only considering the initial written submission filed before him. According to Ld AR, later on, the assessee couldn’t file replies/explain the queries raised by AO as well as couldn’t upload relevant documents during assessment proceedings due to glitches in the computer which led him to pass an ex-parte 144 order. Therefore, the Ld.AR prayed that one more opportunity be granted to assessee, by citing the decision of the Hon’ble Supreme Court in the case of TIN Box Company v. CIT reported in [2001] 249 ITR 216 (SC). The Hon’ble Supreme Court in the case of TIN Box (supra) held as under: 1. It is unnecessary to go into great detail in these matters for there is a statement in the order of the Tribunal, the fact-finding authority, that reads thus: ITA No.2726/Chny/2024 (AY 2019-20) Shri Harichand Rajkumar :: 3 :: \"We will straightaway agree with the assessee's submission that the Income-tax Officer had not given to the assessee proper opportunity of being heard.\" 2. That the assessee could have placed evidence before the first appellate authority or before the Tribunal is really of no consequence for it is the assessment order that counts. That order must be made after the assessee has been given a reasonable opportunity of selling out his case. We, therefore, do not agree with the Tribunal and the High Court that it was not necessary to set aside the order of assessment and remand the matter to the assessing authority for fresh assessment after giving to the assessee a proper opportunity of being heard. 3. Two questions were placed before the High Court, of which the second question is not pressed. The first question reads thus: \"1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in not setting aside the assessment order in spite of a finding arrived at by it that the Income-tax Officer had not given a proper opportunity of hearing to the assessee?\" 4. In our opinion, there can only be one answer to this question which is inherent in the question itself: in the negative and in favour of the asses-see. 5. The appeals are allowed. The order under challenge is set aside. The assessment order, that of the Commissioner (Appeals) and of the Tribunal are also set aside. The matter shall now be remanded to the assessing authority for fresh consideration, as aforestated. No order as to costs. 3. Since, we note that assessee’s replies to queries raised by AO couldn’t be uploaded by the assessee due to glitches in the system, one more opportunity need to be given to assessee before the AO. Hence, we set aside the impugned ex-parte order of the Ld.CIT(A) and restore the assessment back to the file of the AO for de novo adjudication. Needless to say that assessee be given proper opportunity of hearing. The assessee is at liberty to file documents to substantiate the issues raised by the AO. and the Ld.AR has undertaken to file written submissions along with the relevant documents and we expect that assessee to be diligent by ITA No.2726/Chny/2024 (AY 2019-20) Shri Harichand Rajkumar :: 4 :: appearing/presenting documents before the AO, without seeking adjournment unless there is just cause. Further, the assessee is directed to remit Rs.10,000/- as cost to the Tamil Nadu State Legal Services Authority at the Hon’ble High Court of Madras. The amount of Rs.10,000/- shall be paid within a month’s time from the date of receipt of this order and assessee shall produce the receipt for the said payment before the AO and the AO is directed to frame fresh/de novo assessment order in accordance to law. 4. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 14th February, 2025 at Chennai. Sd/- (जगदीश) (JAGADISH) लेखा सद\u0003य/ACCOUNTANT MEMBER Sd/- (एबी टी. वक\r) (ABY T. VARKEY) \u0005याियक सद\u0003य/JUDICIAL MEMBER चे\u0003ई/Chennai, \u0005दनांक/Dated: 14th February, 2025. Vm/- RSR आदेश की )ितिलिप अ0ेिषत/Copy to: 1. अपीला थ\u001b/Appellant, 2.)*थ\u001b/ Respondent, 3. आयकर आयु1/CIT, Coimbatore 4. िवभा गीय )ितिनिध/DR & 5. गा ड& फा ईल/GF. "