Veeraj Construction, Nashik V. Asst. Commissioner of Income Tax, Circle - 2, Nashik, Nashik

ITA 351/PUN/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6648 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 28-05-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 21-02-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; TDS
• Section: 142(1); 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.351/PUN/2024 िनधाᭅरण वषᭅ / Assessment Year: 2017-18 Veeraj Construction, Veeraj Blossom, Flat No.2, Survey No.773, Plot No.52, Karmyogi Nagar, Nashik- 422008. PAN : AAHFV4339G Vs. ACIT, Circle-2, Nashik. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 26.12.2023 passed by LD CIT(A)/NFAC, Delhi for the assessment year 2017-18. 2. The appellant has raised the following grounds of appeal :- “1. The order passed is illegal, invalid and bad in law. 2. The Ld, AO erred on facts and circumstances of the case and in law in making addition of Rs. 1,34,11.152/- to the total income of the appellant towards difference in closing stock and opening stock. Assessee by : None Revenue by : Shri Sourabh Nayak Date of hearing : 29.05.2024 Date of pronouncement : 05.06.2024 ITA No.351/PUN/2024 2 3. The Ld. AO erred on facts and circumstances of the case and in law in making addition of Rs.10,058/- to the total income of the appellant towards interest on late payment of TDS. 4. The Ld. AO erred in passing the assessment order assessing total income at Rs.1,82.50,170/- 5. The learned Assessing Officer erred in charging interest and initiating penalty proceeding under section 270A of the I.T. Act, 1961. 6. The above grounds of appeal are without prejudice and notwithstanding each other. Any consequential relief, to which the Appellant may be entitled under the law in pursuance of the aforesaid grounds of appeal, or otherwise, may be thus granted. The Appellant craves leave to add to or alter, by deletion, substitution or otherwise, any or all of the above grounds of appeal, and the factual and legal arguments against the addition made by the Ld. AO at the time or before the course of appellate proceedings in interest of natural justice.” 3. The facts, in brief, are that the assessee is a partnership firm carrying on business of construction activity, filed its return of income on 27.10.2017 declaring total income of Rs.48,28,960/- for assessment year 2017-18. The case was selected for scrutiny under CASS. Notices u/s 143(2) & 142(1) were issued on 21-09-2018 & 07-08-2019 respectively. After considering the reply of the assessee, the AO made addition of Rs.1,34,11,152/- towards difference in opening & closing stock & vide order dated 26-12-2019 passed the assessment order determining total income at Rs.1,82,50,170/-. ITA No.351/PUN/2024 3 4. Being aggrieved the assessee preferred an appeal before LD CIT(A)/NFAC. Since the assessee remained absent the appeal was dismissed vide order dated 26-12-2023 by LD CIT(A)/NFAC. 5. Being aggrieved with the ex-parte decision of ld. CIT(A)/NFAC, the assessee is in appeal before this Tribunal. 6. LD counsel of the assessee submitted before the bench that LD CIT(A)/NFAC was not justified in deciding the appeal ex-parte & the appellate order was required to be passed on merits of the case. It was further submitted that the assesse was unaware of notices of hearing since the notice was issued on email id which was not mentioned in Form 35 & due to this reason the hearing notice remained un-complied. A written submission is also furnished before the bench in support of grounds of appeal. Under these circumstances, the counsel of the assessee requested before the bench to set-a-side the ex-parte order passed by LD CIT(A)/NFAC & restore the matter back to the file of LD CIT(A)/NFAC to decide the appeal on merits of the case after providing reasonable opportunity of hearing to the assesse. 7. On the other hand, LD DR supported the order passed by LD CIT(A)/NFAC. ITA No.351/PUN/2024 4 8. We have heard learned counsels from both the sides & perused the material available on record. We find that LD CIT(A)/NFAC provided total 3 opportunities to the assessee to submit reply in support of grounds of appeal. But it is also apparent that one opportunity was provided during Covid-19 pandemic & other two were sent on email id which was not mentioned in Form 35 appeal memo. Due to which the appellant assessee remained unaware of dates of hearing & could not respond to the hearing notices. Further we also find that there is contravention of section 250(6) of the IT Act which mandates LD CIT(A)/NFAC to decide the appeal on merits of the case. Obviously the grounds of appeals have not been decided by LD CIT(A)/NFAC, therefore, we find force in the arguments of LD counsel of the assessee that the ex-parte order passed by LD CIT(A)/NFAC is bad in law & hence deem it proper in the interest of justice to provide one more opportunity of hearing to the assessee. Therefore, we set-a-side the ex-parte order passed by ld CIT(A)/NFAC with direction to re-adjudicate the appeal afresh on the merits of the case after providing reasonable opportunity of hearing to the assessee. LD CIT(A)/NFAC shall pass order as per ITA No.351/PUN/2024 5 facts & law & on grounds of appeal after providing reasonable opportunity of being heard to the assessee. The assessee is also hereby directed to submit the details/ explanations in support of the grounds of appeal on merit before LD CIT(A)/NFAC on the appointed day without seeking any adjournment under any pretext, failing which LD CIT(A)/NFAC is at liberty to pass appropriate orders as per law. We hold & direct accordingly. 9. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 05 th June, 2024. Sd/- Sd/- (R. K. PANDA) (VINAY BHAMORE) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 05 th June, 2024. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “B” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.