Kapil Kohli, New Delhi V. ITO WARD - 34(3), New Delhi

ITA 267/DEL/2020

AI Insights

The case involves Kapil Kohli, the appellant, who contested the order of the Learned Commissioner of Income-Tax (Appeals) regarding the assessment year 2013-14. The primary grievances included the lack of sufficient opportunity to be heard and the erroneous confirmation of various additions and disallowances related to business expenses and losses. The Tribunal noted that the assessee had made efforts to comply and had requested adjournments, which were not adequately considered by the CIT(A), leading to an exparte decision against the assessee. The Tribunal's decision to remand the case back to the CIT(A) was influenced by the need to uphold the principles of natural justice and ensure a fair hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300516 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 14-03-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 13-01-2020
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Non compliance; Tax effect
• Section: 263; 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘C’ NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA No.267/Del/2020 Assessment Year:2013-14 Kapil Kohli D-214, Ashok Vihar phase-I, Delhi-110052 PAN No.AHJPK2387C Vs. ITO Ward- 34(3) New Delhi (Appellant) (Respondent) ORDER PER O.P. KANT, AM: This appeal by the assessee is directed against order dated 31/10/2019 passed by the Learned Commissioner of income-tax- 12, New Delhi [in short the “Ld. CIT(A)”], for A.Y.2013-14, raising following grounds: 1. Ld. CIT(A) has not provided sufficient opportunity of being heard to the assessee, which is against the principle of natural justice. 2. Ld. CIT(A) has erred in forming his considered opinion that appellant failed to submit necessary explanation with regard to the claim of deductions, during the assessment Appellant by Sh. Susheel Kumar Gupta, CA Respondent by Modh. Gayasuddin Ansari, CIT (DR) Date of hearing 15.03.2023 Date of pronouncement 15.03.2023 2 ITA No.267/Del/2020 proceedings. 3. Ld. CIT(A) has erred in holding that appellant has not been able to substantiate his ground of appeal, before him, whereas assessee was not given sufficient opportunity of being heard. 4. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred both in law and on fact in confirming addition of Rs. 30,11,798/- on account of interest paid to Religare Finvest Limited, on the ground that assessee could not prove that loan taken was utilized wholly and exclusively for the business purpose as required u/s 36 (l)(iii) of the IT Act, without appreciating the fact that direct nexus in respect of loan taken in financial year 2010-2011 cannot be established with business transactions of financial year 2012-2013. (Tax Effect of Rs. 9,30,646/-) 5. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred both in law and on fact in confirming disallowance of Rs. 1,11,092/- under section 14A of the Act, in the absence of any dividend income. (Tax Effect of Rs. 34,328/-) 6. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred both in law and on fact in confirming disallowance of claim of loss of Rs. 13,45,545/- on account of difference of exchange without appreciating the fact that loss was incurred due to lesser realization of exports sale proceeds due to exchange rate fluctuation and reinstatement of foreign assets in accordance with Accounting Standard-11 issued by Institute of chartered Accountants of India. (Tax Effect of Rs.4,15,774/-) 7. I pray that the addition/ disallowance made in respect of assessed income for the AY 2013-14 be deleted. 2. Briefly stated the facts of the case are that the Assessing Officer passed the impugned assessment order dated 09.10.2018 in compliance to the order passed by the Learned Principal Commissioner of Income-Tax u/s. 263 of Income-tax Act, 1961 (in short “the Act”). 3. Aggrieved, the assessee filed an appeal before the CIT(A). However, due to non compliance on the part of the assessee, the appeal was dismissed as exparte. 3 ITA No.267/Del/2020 4. Aggrieved, the assessee is before the Tribunal by way of raising grounds as reproduced as above. 5. Before us the Learned Counsel of the assessee submitted that the Authorized Representative of the assessee duly filed an application for adjournment of hearing before the Ld. CIT(A) however, the Learned CIT(A) rejected the request and decided the appeal exparte without taking into consideration the submission of the assessee, therefore, order of the Learned CIT(A) might be set aside and matter be restored back to the file for deciding afresh after taking into consideration the submission of the assessee. On the contrary the Learned Departmental Representative opposed and submitted that the assessee was provided more than 4 opportunities however, no compliance was made and, therefore, the present appeal should be decided on merit. 6. We have heard rival submission and perused the relevant material on record. We find that the Learned CIT(A) has reproduced the details of the notices issued and response on behalf of the assessee. It is seen from the table reproduced in para-3 of the impugned order that on two occasions, the Learned CIT(A) adjourned the date of the hearing on the telephonic request of the authorized representative of the assessee. On 3 rd occasion authorized representative of the assessee filed a letter for adjournment. On one occasion i.e. 01.04.2019 no compliance was made by the assessee. Thereafter, further date was given to the assessee on 30.10.2019, for which the authorised representative of the assessee applied for adjournment. The 4 ITA No.267/Del/2020 Learned CIT(A) rejected the adjournment request of the assessee and passed this order exparte qua the assessee. 8. In our opinion this is not a case of absolute non compliance on the part of the assessee. The Learned Counsel for the assessee before us submitted that due to personal difficulty, the authorized representative could not appear before the Learned CIT(A). The Learned Counsel before us gave an undertaking that due compliance shall be made before the Learned CIT(A), if matter is restored back to him. In the facts and circumstances of the case we feel it appropriate to restore this matter back to the file of the Learned CIT(A) for deciding afresh after taking into consideration submission of the assessee. The grounds of the appeal of the assessee are accordingly allowed for statistical purpose. 9. In the result, the appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on 15.03.2023. Sd/- Sd/- (KUL BHARAT) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:15.03.2023 *NEHA* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi