LATE REHMATUNISA A. SAYED THROUGH L/H SALIMULLAH A. SAYED (SON), MUMBAI V. THE ITO-34(2)(1), MUMBAI

ITA 1405/MUM/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 8691 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 09-08-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: KALPESH TURLKAR
• Keywords: Principle of natural justice; Reason to believe
• Section: 143(3); 234B; 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER & SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ITA No. 1405/Mum/2021 (A.Y: 2011-12) Late Rehmatunisa A. Sayed through L/H Salimullah A. Sayed (Son), C/11/82, MIG Colony, Bandra (East), Mumbai-400051. Vs. The ITO – 34(2)(1) Bandra Kurla Complex, C-11 Bandra(East), Mumbai- 400051. ./ज आइआर ./PAN/GIR No. : DBPPS7580J Appellant .. Respondent Appellant by : Shri.Kalpesh Turlkar.AR Respondent by : Shri Pramod Nikalje.DR Date of Hearing 13.06.2022 Date of Pronouncement 14.06.2022 आद श / O R D E R PER PAVAN KUMAR GADALE JM: The assessee has filed the appeal against the order of the National Faceless Appeal Centre (NFAC), New Delhi passed u/s 143(3) r.w.s 147 and 250 of the Act. The assessee has raised the following grounds of appeal: i. On the facts and in the circumstances of the case and law, the Ld. CIT(A) erred in confirming the assessment reopen u/s 147 r.w.s 148 of the Act. An assessee who has expired ITA No. 1405/Mum/2021 Late Rehmatunisa A Sayed, Mumbai - 2 - on 27.01.2018 whereas the notice u/s 148 which dated 15.03.2018 i.e after the death of the assessee. ii. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the reopening without application of mind to the facts of the case that the notice u/s 148 is issued to a deceased person and hence bad in law. iii. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming addition of Rs. 25,21,508/- rejecting the appellants claim that the capital receipt not liable to capital gain tax or income tax. iv. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the ley of interest u/s 234A and 234B as receipt of Rs. 25,21,508/- was not expected as liable to tax at the time of estimating a income for advance tax u/s 210 of the Income Tax Act, 1961. v. The appellant craves leave to add, alter, amend or delete any ground(s) of appeal either before or during the course of hearing of the appeal. 2. Further, vide letter dated 02.06.2022, the assessee has raised the following additional grounds of appeal: - 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) / NFAC erred in confirming the impugned order passed by the AO, without granting a reasonable opportunity to the appellant assessee to present his case which is in flagrant violation of principle of natural justice. 2. The Ld. CIT(A) / NFAC was not justified in not adjudicating the ground of the appellant assessee the issuance of notice to a deceased person and framing assessment in the name of the dead person, in invalid and non est in the eyes of law. ITA No. 1405/Mum/2021 Late Rehmatunisa A Sayed, Mumbai - 3 - 3. The appellant craves leave to alter, and/ or substitute all/any of the aforesaid additional grounds of appeal at the time of hearing. 3. We have heard the submissions of the Ld. AR and Ld. DR on the additional grounds of appeal and are admitted and heard along with original grounds of appeal. 4. The brief facts of the case are that the assessee is represented by the legal heir and the assessee has not filed the return of income. Whereas the assessee has received compensation of Rs.25,21,508/- for hardship and inconvenience from the developer M/s DB MIG realtors and Builders Pvt Ltd as per terms and conditions of redevelopment agreement. Since the assessee has not filed the return of income and the Assessing officer (A.O.) has reason to believe that the income has escaped assessment and issued notice u/s 148 of the Act. In compliance to the notice u/s 148 of the Act the assessee has filed the return of income on 11.05.2018 disclosing a total income of Rs. 84,848/-.The assessee has submitted the details referred at Para 5 of the order. The A.O was not satisfied with the explanations of the assessee on the ITA No. 1405/Mum/2021 Late Rehmatunisa A Sayed, Mumbai - 4 - grant of compensation and treated it as income of the assessee and assessed the total income of Rs. 25,83,420/- and passed the order u/s 143(3) r.w.s 147 of the Act dated 10.12.2018. 5. Aggrieved by the order the assessee has filed an appeal before the CIT(A). Whereas the CIT(A) in the appellate proceedings considered the grounds of appeal and findings of the A.O and also notice of hearing was issued to the assessee and there was no compliance/response from the assessee. Therefore the CIT(A) has considered the information on record and confirmed the addition and dismissed the appeal. Aggrieved by the order, the assessee has filed an appeal before the Hon’ble Tribunal. 6. At the time of hearing, the Ld. AR submitted that the CIT(A) erred in confirming the action of the AO without considering the material information filed. Further the assessee was not provided reasonable opportunity of hearing to submit the evidences and prayed for an opportunity to substantiate the case before the lower authorities. Contra, the Ld. DR supported the order of the CIT(A). ITA No. 1405/Mum/2021 Late Rehmatunisa A Sayed, Mumbai - 5 - 7. We heard the rival submissions and perused the material on record. Prima-facie the CIT(A) has passed the ex-parte order considering the fact that there is no appearance nor any submissions are filed by the assessee in spite of providing adequate opportunity of hearing. Therefore, the CIT(A) has dismissed the appeal ex-parte confirming the action of the assessing officer. We on perusal of the CIT(A) found that the Ld.CIT(A) has issued the notice of hearing referred at page 4 of the order, but there was no response and thus the Ld.CIT(A) came to a conclusion that the assessee is not inclined to prosecute the appeal and relied on the material on record. 8. We find that the assessee has raised grounds of appeal challenging the addition by the A.O. and there could be various reasons for non appearance which cannot be overruled. We considering the principles of natural justice shall provide one more opportunity of hearing to the assessee to substantiate the case along with evidences and information. Accordingly, we set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh on merits and the assessee should be provided ITA No. 1405/Mum/2021 Late Rehmatunisa A Sayed, Mumbai - 6 - adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of appeal and allow the grounds of appeal of the assessee statistical purpose. 9. In the result, the appeal filed by the assessee is treated as allowed for statistical purpose. Order pronounced in the open court on 14.06.2022. Sd/- Sd/- ( GAGAN GOYAL) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated 14.06.2022 KRK, PS /Copy of the Order forwarded to : 1. / The Appellant 2. / The Respondent. 3. आ र आ / The CIT(A) 4. आ र आ ( ) / Concerned CIT 5. "#$ % & &' , आ र ) र*, Mumbai / DR, ITAT, Mumbai 6. % +, - . / Guard file. ान ु सार/ BY ORDER, " & //True Copy// 1. ( Asst. Registrar) ITAT, Mumbai