Hemendra Gangawat , Udaipur V. ITO, Ward-TDS, , Udaipur

ITA 145/JODH/2023

AI Insights

The case involves Hemendra Gangawat, the proprietor of M/s Metro Trading Company, who appealed against the orders of the National Faceless Appeal Centre (NFAC)/CIT (A), Delhi. The appeals were related to the ex-parte assessment proceedings under sections 206C(6), 206C(6A), and 206C(7) of the Income Tax Act, 1961, concerning the levy of Tax Collected at Source (TCS) on minor forest products. The primary contention was the lack of a reasonable opportunity for the assessee to be heard during the assessment and the subsequent appeal process. The CIT(A) had confirmed the assessment due to the non-compliance of the assessee to the notices, leading to the filing of the appeals before the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125609 (ITAT-JODHPUR)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 06-08-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 07-05-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; TDS

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “DB” BENCH, JODHPUR BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER & SHRI DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER. ITA No. 144 & 145/JODH/2023 (A.Y: 2014-15 & 2015-16) Hemendra Gangawat, Prop:M/sMetroTrading Company, 52, Krishi upaj Mandi, Udaipur -313001 Rajasthan. Vs. ITO, Ward – TDS Aayakar Bhawan, Room No. 01A, Ground Floor, Near Sub-City Centre, Reti Stand, Savina, Udaipur – 313001 Rajasthan. PAN/GIR No. : ABYPG8819Q Appellant .. Respondent Assessee by : None Revenue by : Ms. Nidhi Nair, JCIT - DR Date of Hearing 07.08.2023 Date of Pronouncement 08.08.2023 आदेश / O R D E R PER PAVAN KUMAR GADALE JM: These two appeals are filed by the assessee against the separate orders of the National Faceless Appeal Centre (NFAC)/CIT (A), Delhi passed U/sec250 of the Act. Since the issues involved in these two appeals are common and identical, hence are clubbed, heard and consolidated order is passed. For the sake of convenience, we shall take ITA No. 144&145/Jodh/2023 Hemendra Gangawat.Udaipur. - 2 - up the ITA No.144/Jodh/2023 for the A.Y. 2014-15 as a lead case and the facts narrated. The assessee has raised the following grounds of appeal: 1.The Ld. CIT (Appeals), NFAC, Delhi has grossly erred in facts and in law in completing the appellate proceedings exparte by confirming the exparte assessment proceedings u/s 206C(6)/206C(6A)/206C(7) of the IT Act, 1961, whereas while completing the assessment, the AO has not provided the reasonable opportunity of being heard to the assessee to explain his case, therefore the action of the Ld. CIT (Appeals), NFAC, Delhi is unwarranted, against the principles of natural justice, unjustified & bad in law as per the provisions of act and the order so passed is bad in law is liable to be quashed. 2. That the Ld. CIT (Appeals), NFAC, Delhi has grossly erred in law as well as on fact of the case in confirming the levy of TCS U/s 206C(6)/206C(6A) amounting to Rs. 19,992/- on Minor Forest Produce 2.5percent on the turnover of the assessee amounting to Rs. 7,69,198/- by assuming that the said turnover falls under the category of Minor Forest Produce other than Timber & Tendu Leaves for the year under consideration. Therefore, the action of the Ld. CIT (Appeals), NFAC, Delhi is erroneous & bad in law as per the provisions of act and is liable to be deleted. 3. That the Ld. CIT (Appeals), NFAC, Delhi has grossly erred in law as well as on fact of the case in confirming the levy of Interest U/S 206C(7) of the IT Act, 1961 amounting to Rs. Rs. 18,193/- as per his convenience. Therefore, the action of the Ld. CIT (Appeals), NFAC, Delhi is erroneous & bad in law as per the provisions of act and is liable to be deleted. ITA No. 144&145/Jodh/2023 Hemendra Gangawat.Udaipur. - 3 - 4. That the appellant reserves his rights to add, to alter or to modify any grounds of the appeal on or before hearing of the same. 2. The brief facts of the case are that, the assessee is an individual and is a proprietor of M/s Metro Trading Company engaged in the business of trading of minor forest products and other commodities. Whereas per the provisions u/sec 206C of the Act, the assessee need to collect /deposit the TCS U/sec2o6C of the Act@ 2.5% of the total sale of minor forest products. In this regard, the assessee was issued notice u/s 206C(6A) r.w.s 206C(7) of the Act to submit the details of total minor forest products sold from F.Y 2010-11 to F.Y 2013-14. In response to the notice the assessee has filed the reply on 16.03.2021 along with the affidavit and details of total turnover and sale of forest produce. Whereas the AO has dealt on the facts and information in the course of hearing and observed that during the financial year the assessee has made sale of forest produce of Rs.7,69,198/- and is subjected to TCS @ 2.5% as per the provisions of Section 206C of the Act and worked out the TCS amount of Rs. 19,230/- and passed the order u/s 206C(6) /206C(6A) / 206C (7) of the Act dated 23.03.2021. ITA No. 144&145/Jodh/2023 Hemendra Gangawat.Udaipur. - 4 - 3. Aggrieved by the order, the assessee has filed an appeal before the CIT(A),whereas the CIT(A) has considered the grounds of appeal, statement of facts and findings of the AO and has issued notices of hearing and since there was no compliance by the assessee to notices. Therefore the CIT(A) considering the information on record has confirmed the action of the A.O and dismissed the appeal. Aggrieved by the ex parte order of the CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal. 4. At the time of hearing, none appeared on behalf of the assesee. Contra, the Ld. DR supported the order of the CIT(A). 5. We heard the Ld.DR submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no appearance in spite of providing adequate opportunity of hearing and the notices were issued. Therefore, the CIT(A) was of the opinion that the assessee is not interested in prosecuting the appeal and dismissed the appeal ex-parte confirming the action of the assessing officer. The Ld. CIT(A) has issued the notices of hearing referred at Para 7 &11.1 of the order, but there was no response and thus the Ld.CIT(A) came to a conclusion that the assessee is not interested and decided ITA No. 144&145/Jodh/2023 Hemendra Gangawat.Udaipur. - 5 - the appeal based on the information available on record. Whereas the assessee has raised grounds of appeal challenging the action of the A.O in invoking the provisions U/sec206C of the Act and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the principles of natural justice shall provide with one more opportunity of hearing to the assessee to substantiate the case 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 and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal. And the grounds of appeal of the assessee are allowed for statistical purposes. 6. In the result, the appeal filed by assessee is allowed for statistical purposes. ITA Nos 145/Jodh/2023 A.Y.2015-16. 7. As the facts and circumstances in this appeal are identical to ITA No. 144/Jodh/2023, for the A.Y 2014-15 (except variance in figures) and the decision rendered in above paragraphs would apply mutatis mutandis for this ITA No. 144&145/Jodh/2023 Hemendra Gangawat.Udaipur. - 6 - appeal also. Accordingly, grounds of appeal of the assessee are allowed for statistical purposes. 8. In the result, both the appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on 08.08.2023. Sd/- Sd/- (DR DIPAK P RIPOTE) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Jodhpur Dated 08.08.2023 KRK, PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A) 4. Concerned CIT 5. DR, ITAT, Jodhpur 6. Guard file. आदेशान ु सार/ BY ORDER, //True Copy// 1. ( Asst. Registrar) ITAT, Jodhpur