Arankari Risk Managemenrt Services Pvt Ltd, Ghaziabad V. DCIT Circle-3(1), Ghaziabad

ITA 1544/DEL/2020

AI Insights

The case involves Arankari Risk Management Services P. Ltd, which appealed against the order of the ld CIT(A)-32, New Delhi, arising from an assessment order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961. The Assessing Officer had disallowed certain expenditures and made additions under sections 14A and 68 of the Act, leading to a revised loss figure for the assessee. The CIT(A) dismissed the appeal ex parte, citing non-cooperation from the assessee. The Tribunal found that the CIT(A) had not adequately considered the submissions made by the assessee and had dismissed the appeal without proper hearing, leading to the decision to set aside the CIT(A)'s order and remand the case for a fresh decision on merits.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 131145 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-11-2022
• Assessment Year: misc
• Appeal Filed On: 03-09-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Set aside
• Section: 68; 143(3); 14A

Judgement Text

Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A”: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No. 1544/Del/2020 (Assessment Year: 2014-15) Arankari Risk Management Services P. Ltd, C/o. R. K. Govil & Co., 4, Kiran Enclave, GT Road, Behind Hotel Samrat, Ghaziabad Vs. DCIT, Circle-3(1), Ghaziabad (Appellant) (Respondent) PAN: AACCA7537R Assessee by : Shri George Koshi, CA Revenue by: Shri Kanav Bali, Sr. DR Date of Hearing 21/11/2022 Date of pronouncement 22/11/2022 O R D E R PER ANUBHAV SHARMA, J. M.: 1. The present appeal has been preferred by the Assessee against the order dated 28.02.2020 of Ld. CIT(A)-32, New Delhi (hereinafter referred as Ld. First Appellate Authority) arising out of an appeal before it against the assessment order dated 15.12.2016 passed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred as „the Act‟) by the Assessing Officer, DCIT, Circle-3(1), New Delhi (hereinafter referred as the Ld. AO). 2. Facts in brief are that the assessee filed return of income declaring loss of Rs. 9,87,69,937/- and scrutiny assessment was done of the assessee which is engaged in purchase and sale of shares and making investment and trading of shares. The ld AO had disallowed expenditure u/s 14A to the extent of Rs. 69,174/-. Further, in the absence of 3 rd party Page | 2 confirmation and unsatisfactory reply, creditworthiness and genuineness of the unsecured loan parties were found suspicicious and addition u/s 68 of the Act of Rs. 9,49,46,999/- was made. Further, the ld AO on the basis of notice issued u/s 133 was unsatisfied with the trade payable reflected in the books of account and finding them to be not supported by confirmations. Addition u/s 68 to the extent of Rs. 2,51,95,243/- was made and the total loss was rounded off to Rs. 2,41,51,480/-. The ld CIT(A) dismissed the appeal ex parte. 3. Heard and perused the record. 4. The assessee has raised as many as 18 grounds however at time hearing the ld counsel restricted argument to the fact that the ld CIT(A) erred in passing ex parte order without providing to the assessee an opportunity of being heard. 5. It can be appreciated from the order of the ld CIT(A) that although the assessee was given various opportunities of hearing and adjournment as sought. However, on 28.02.2020 the ld AR has sought adjournment but same was not considered and the ld CIT(A) has decided the matter vide order dated 28.02.2020. The ld CIT(A) in para No. 4.3 observed as under:- “4.3 Appellant has been totally non-cooperative during the appellate proceedings. It is apparent that appellant is not interested in pursuing its appeal. In view of these facts, I am of the opinion that no interference is called for in the AO’s order, as such, the grounds of appeal are dismissed and the addition made by the AO is confirmed.” 6. Thereafter, in para No. 5 and 5.1 the ld CIT(A) discussed the merits of addition as appearing from the assessment order and again in para 5.2 observed as follows:- “5.2 Before me also, during appellate proceedings, despite allowing opportunity of being heard in this regard, so as to justify its claim that no additions needed to be made in appellant’s present Page | 3 case, no any further details have been filed by appellant company. Initially no authorized person attended the proceedings and later on the AR of the company sought only adjournments and only once a part information was filed. Therefore, considering the facts and circumstances off the case, I have no reason to interfere with the findings of the AO and provide any further relief to appellant in respect of addition of Rs. 12,28,52,242/- made by AO. Accordingly, addition of Rs. 12,28,52,242/- made by AO, is hereby upheld. Grounds of appeal taken by appellant are dismissed.” 7. On behalf of the assessee at page No. 17 to 28 the copies of submission dated 11.09.2018 filed before the ld CIT(A) have been placed on record along with annexures. However, the order of the ld CIT(A) is silent about the aforesaid submissions. The order of the ld CIT(A) thus is erroneous as at one end it had dismissed the appeal for none prosecution on the other hand while referring to the merits of the addition on the basis of assessment order failed to take into consideration the written submission made on behalf of the assessee. 8. Thus, the ground Nos. 2 to 5 are sustained and appeal is allowed for statistical purposes. The impugned order of the ld CIT(A) is set aside and the issue is restored to the file of the ld CIT(A) to decide the appeal of the assessee on merits and due opportunity of hearing be given to the assessee. Order pronounced in the open court on 22/11/2022. -Sd/- -Sd/- (SHAMIM YAHYA) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 22/11/2022 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi