Gabani Polyester Pvt. Ltd., Surat V. Income Tax Officer, Ward - 1(1)(2), Surat

ITA 295/SRT/2022

AI Insights

The case involves Gabani Polyster Pvt. Ltd., the appellant, contesting the ex-parte orders passed by the CIT(A)/NFAC for the Assessment Years 2004-05 and 2005-06. The primary contention was the lack of fair and reasonable opportunity of hearing provided to the assessee, which is mandated under Section 250(6) of the Income Tax Act. The assessee argued that notices were not properly served, and even when served, the CIT(A) did not grant adequate time for compliance. The Departmental Representative supported the CIT(A)'s decision, asserting that sufficient opportunities were provided. However, the Tribunal found that the CIT(A) had not adjudicated the issues on merit as required and thus restored the appeals for a fresh decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 302251 (ITAT-SURAT)
• Duration Of Justice: 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 29-03-2023
• Assessment Year: 2005-2006
• Appeal Filed On: 13-10-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rule of consistency; Set aside
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT, SMC BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No. 294 & 295/Srt/2022 (Assessment Year: 2004-05 & 2005-06) (Physical Hearing) Gabani Polyster Pvt. Ltd., A/7, Trikamnagar Society, Part-1, Lambe Hanuman Road, Surat-395006. PAN No. AAACG 8686 K Vs. I.T.O., Ward 1(1)(2), Surat. Appellant/ assessee Respondent/ revenue Assessee represented by Ms. Himali Mistry, CA Respondent represented by Shri Vinod Kumar, (Sr.DR) Date of hearing 30/03/2023 Date of pronouncement 30/03/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. Both these appeals by assessee are directed against the separate orders of learned National Faceless Appeal Centre, Delhi (NFAC)/Commissioner of Income Tax (Appeals) (in short, the ld. CIT(A) both dated 14/09/2022 for the Assessment year (AY) 2004- 05 & 2005-06 respectively. In both these appeals, the assessee(s) has raised one common grounds of appeal which relates to passing ex-parte order by ld CIT(A)/NFAC, therefore, both these appeals were clubbed, heard together and are being decided by this consolidated order. For appreciation of facts, the appeal in ITA No. 294/Srt/2022 for the A.Y. 2004-05 is treated as a “lead case”. ITA No. 294 & 295/Srt/2022 Gabani Polyster Pvt Ltd. Vs ITO 2 2. At the outset of hearing, learned Authorized Representative (Ld.AR) for the assessee submits that Ld. CIT(A) passed the impugned ex parte order without giving fair and reasonable opportunities of hearing to the assessee. The Ld. CIT(A) in para-3 of impugned order has recorded that despite giving final opportunity no compliance was made on the part of assessee. The Ld. CIT(A) finally dismissed the appeal of assessee without adjudicating the various grounds of appeal as per mandate of Section 250(6) of the Act. The ld AR for the assessee submits that no notice was served on the assessee through email provided in Form-35 (Appeal form before ld CIT-A). However, in appeal for AY 204-06, the notice was served on the assessee, the assessee sought adjournment, but the ld CIT(A) instead of granting time dismissed the appeal. The ld. AR of the assessee submits that the assessee has a good case on merit and likely to succeed if the assessee is to be heard and the appeal is to be decided on merit. The ld AR for the assessee submits that even the facts mentioned in the assessment order was not considered by ld CIT(A). The ld AR for the assessee prayed that matter may be restored back to the file of Ld. CIT(A) for adjudicating the issue afresh in accordance with law and he undertakes on behalf of the assessee to be more vigilant in attending the hearing before ld CIT(A). ITA No. 294 & 295/Srt/2022 Gabani Polyster Pvt Ltd. Vs ITO 3 3. On the other hand, the learned Senior Departmental Representative (ld. Sr DR) for the revenue supported the order of ld. CIT(A) and submitted that ld CIT(A) granted sufficient opportunity to the assessee as recorded in para-2 of the order. The notices for both the appeals were served through email provided by the assessee. If the notice in appeal for AY 2005-06 was served, then why it was not served for AY 2004-05. The assessee failed to availed such opportunity and now taking plea that sufficient opportunity was not given to him. The assessee has no regards to the public authorities in attending the hearing before them and now claiming that no fair or reasonable opportunity was not given to the assessee. The assesse does not deserve any leniency, the ld CIT(A) passed the order after considering all the facts available before him. The ld Sr DR for revenue prayed for dismissing both the appeals. 4. I have heard the submissions of both the parties and have gone through the orders of lower authorities carefully. I find that the Assessing Officer levied penalty under section 271(1)(c) of Rs. 10,77,720/- being 100% of tax sought to be evaded on the additions made in the assessment order. The ld CIT(A)/ NFAC dismissed the appeal of assessee by holding that the notice to the assessee was served through email provided by the assessee but no response was received. The ld CIT(A) dismissed the appeal of ITA No. 294 & 295/Srt/2022 Gabani Polyster Pvt Ltd. Vs ITO 4 the assessee without adjudicating the issues on merit and as per the mandate of section 250(6) of the Act. Section 250(6) mandates that order of ld. CIT(A) must contain facts of the case, points of determination and decision thereon and reasons of such decision. Considering the fact that ld. CIT(A) passed the ex parte order, therefore, the order of ld. CIT(A) is set aside and all the grounds of appeal raised by the assessee are restored back to the file of ld. CIT(A)/NFAC to decide all the grounds of appeal afresh and in accordance with law. Needless to direct that before passing the order, the ld. CIT(A) shall grant reasonable opportunity of hearing to the assessee. The assessee is also directed to be more vigilant in future and not to cause further delay and seek adjournment without any valid reason and to furnish all the details and his submissions on various grounds of appeal raised by him, as soon as possible, if so desired without any further delay. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes. 5. In the result, the appeal of assessee is allowed for statistical purposes only. ITA No. 295/Srt/2022 for A.Y. 2005-06 6. As recorded earlier the assessee has raised common ground of appeal as raised in appeal in ITA No. 294/Srt/2022 for A.Y. 2004-05. Considering the fact that I have restored the appeal back to the file ITA No. 294 & 295/Srt/2022 Gabani Polyster Pvt Ltd. Vs ITO 5 of ld. CIT(A)/NFAC for fresh adjudication of all the issues on merit, therefore, considering the principle of consistency, the appeal of ITA No. 295/Srt/2022 for the A.Y. 2005-06 is also restored back to the ld. CIT(A)/NFAC with similar direction. In the result, this appeal is also allowed for statistical purposes. 7. In the final result, both these appeals of the assessee(s) are allowed for statistical purposes only. Order pronounced in the open court on 30 th March, 2023. Sd/- (PAWAN SINGH) JUDICIAL MEMBER Surat, Dated: 30/03/2023 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT(A) 3. CIT 4. DR 5. Guard File By order Sr. Private Secretary, ITAT, Surat