Akshaj Hi-tech Infrastructure Pvt Ltd, Chandigarh V. DCIT, CC-1, Chandigarh

ITA 511/CHANDI/2022

AI Insights

The appeals by M/s Akshaj Infra Pvt. Ltd. and M/s Akshaj Hi Tech Infrastructure Pvt. Ltd. against the orders of the CIT(A)-3, Gurgaon, pertained to the assessment years 2008-09 and 2012-13. The primary contention was the ex-parte dismissal of their appeals by the CIT(A), which was argued to be against the principles of natural justice. Additionally, the appeals challenged the penalties imposed under section 271(1)(c) of the Income Tax Act, which were based on alleged concealment of income and inaccurate particulars. The Tribunal noted the procedural lapses in the handling of the appeals by the CIT(A) and decided to remand the cases for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127834 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 22-05-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 07-06-2022
• Other Referred Cases: S. Velu Palandar Vs. DCIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Invalid notice; Business income; Principle of natural justice; Assessment record
• Section: 271(1)(c); 14A

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, ‘A’, CHANDIGARH BEFORE SHRI A.D. JAIN, VICE PRESIDENT & SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER आयकर अपील सं./ ITA Nos. 5 0 9 & 5 1 0 / C H D / 2 0 2 2 नधा रण वष / Assessment Years : 2008-09 and 2012-13 M/s Akshaj Infra Pvt. Ltd., 911, 9 th Floor, Surya Kiran Building, 19, K.G.Marg, Connaught Place, New Delhi 110001 Vs. बनाम The DCIT, Central Circle-1, Chandigarh थायी लेखा सं./PAN No: AADCK1301N अपीलाथ /Appellant यथ /Respondent & आयकर अपील सं./ ITA No. 5 1 1 / C H D / 2 0 2 2 नधा रण वष / Assessment Year : 2012-13 M/s Akshaj Hi Tech Infrastructure Pvt. Ltd., 911, 9 th Floor, Surya Kiran Building, 19, K.G.Marg, Connaught Place, New Delhi 110001 Vs. बनाम The DCIT, Central Circle-1, Chandigarh थायी लेखा सं./PAN No: AAMCS0140A अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से/Assessee by : Sh. Tej Mohan Singh, Advocate राज व क ओर से/ Revenue by : Sh. Amanpreet Kaur, Sr.DR स ु नवाई क तार$ख/Date of Hearing : 23.05.2023 उदघोषणा क तार$ख/Date of Pronouncement : 26.05.2023 आदेश/Order Per A.D. Jain, Vice President: 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 2 These are Assessees appeals against the respective orders of the ld. CIT (A)-3, Gurgaon as per the following details:- S.No. ITA No. A.Y. CIT(A)-3,Gurgaon order dated 1 509/Chd/2022 2008-09 30.06.2018 2 510/Chd/2022 2012-13 05.08.2018 3 511/Chd/2022 2012-13 05.09.2018 2. Since the issues involved in these appeals are identical, they have been heard together and are being disposed of by this common order. For the sake of description of facts, ITA No. 509/Chd/2022 is being taken as the lead case. 3. The Assessee, in ITA No.509/Chd.2022, has taken the following grounds of appeal:- 1. That the Ld. Commissioner of Income Tax (Appeals) has erred in law in dismissing the appeal ex-parte without affording an opportunity of hearing which is against the Principals of Natural Justice and as such the order passed is illegal, arbitrary and unjustified. 2. Without prejudice to the above, the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the imposition of penalty of Rs.2,48,038/- u/s 271 (l)(c) of the Act which is illegal, arbitrary & unjustified. 3. That the penalty imposed under section 271(1 )(c) of the Act is not imposable in as much as there is neither any concealment of income 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 3 nor furnishing of any inaccurate particulars of income and as such the order passed under section 271 (1 )(c) of the Act is illegal, arbitrary & unjustified. 4. That the Ld. Assessing Officer had changed the head of income from business to Income from House property which is highly debatable and as such the penalty imposed and upheld by Commissioner of Income Tax (Appeals) on a debatable issue is arbitrary and unjustified. 5. That the order of the Ld. Commissioner of Income Tax upholding the imposition of penalty under section 271(1 )(c) of the Act is erroneous, arbitrary, opposed to law and facts of the case and is, thus, untenable. 4. At the outset, it has been submitted by the ld. Counsel for the Assessee that the foremost grievance of the Assessee is that the ld. CIT(A) has concluded the proceedings by passing an ex-parte order without proper perusal of the assessment record and dismissed the appeal of the Assessee by upholding the imposition of penalty levied by the AO u/s 271(1)(c) of the Act. Further, it has been submitted by the ld. Counsel for the Assessee that there was neither any concealment of income nor the Assessee had furnished any inaccurate particulars of income and as such the action of the CIT(A) in upholding the order of the AO is not justified. It has further been submitted that the AO had changed the head of income from ‘business income’ to ‘Income from Housing property’, which is a highly debatable issue thus the penalty imposed by the AO and further confirmed by the ld. CIT(A) by passing an ex-parte order is totally unfair, arbitrary and unjustified. It is 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 4 submitted that the Assessee has a fair case on merits and therefore, prayed that keeping in view the principles of natural justice, the Assessee may be given a reasonable opportunity of hearing of the appeal before the ld. Commissioner (Appeals) and the appeal may be directed to be decided on merits. 5. The ld. DR, on the other hand, relied on the orders of the lower authorities. 6. Heard. We have gone through the orders of the AO as well as CIT(A) and find that the ld. CIT (A) has dismissed the appeal of the Assessee ex-parte by merely upholding the imposition of penalty levied by the AO, without considering the material available on record, and also without going into the merits of the case. As such, an opportunity of hearing requires to be given to the Assessee to represent his case fully before the lower authorities. Even otherwise, it is trite [‘S. Velu Palandar Vs. DCIT’ 83 ITR 683 (Mad.)] and incumbent on the authority to decide an appeal on merit. The ld. D.R., though, has placed reliance on the orders of the authorities below, but has no objection if the matter is remanded to the AO for adjudication afresh. 7. In view of the above, in the interest of justice, the matter is remitted to the file of the CIT(A), to be decided afresh on merit, in accordance with law, on affording due and adequate opportunity of 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 5 hearing to the Assessee. The Assessee, no doubt, shall cooperate in the fresh proceedings before the CIT(A). All pleas available under the law shall remain so available to the assessee. Ordered accordingly. ITA Nos. 510/Chd/2022:- 8. The Assessee has taken the following grounds of appeal:- 1. That the Ld. Commissioner of Income Tax (Appeals) has erred in law in dismissing the appeal ex-parte without affording an opportunity of hearing which is against the Principals of Natural Justice and as such the order passed is illegal, arbitrary and unjustified. 2. That the Ld. Assessing Officer has erred in law in failing to mention whether notice under section 271 (1 )(c) issued was for concealment of income or for furnishing inaccurate particulars of income and as such penalty imposed and upheld by the Commissioner of Income Tax (Appeals) in pursuance of an invalid notice is illegal, arbitrary & unjustified. 3. Without prejudice to the above, the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the imposition of penalty of Rs.8,13,667/- u/s 271(l)(c) of the Act which is illegal, arbitrary & unjustified. 4. That the Assessing Officer had made the addition applying the deeming provisions of Section 14A which is not free from debate and as such the penalty upheld by the Commissioner of Income Tax (Appeals) on a debatable issue is arbitrary and unjustified. 5. That the penalty imposed under section 271 (l)(c) of the Act is not imposable in as much as there is neither any concealment of income nor furnishing of any inaccurate particulars of income and as such the order passed under section 271(1 )(c) of the Act is illegal, arbitrary & unjustified. 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 6 6. That the order of the Ld. Commissioner of Income Tax upholding the imposition of penalty under section 271 (1 )(c) of the Act is erroneous, arbitrary, opposed to law and facts of the case and is, thus, untenable. ITA No. 511/Chd/2022 9. The Assessee has taken the following grounds of appeal:- 1. That the Ld. Commissioner of Income Tax (Appeals) has erred in law in dismissing the appeal ex-parte without affording an opportunity of hearing which is against the Principals of Natural Justice and as such the order passed is illegal, arbitrary and unjustified. 2. That the Ld. Commissioner of Income tax (Appeals) has failed to adjudicate on the specific ground raised before him that Assessing Officer has erred in law in failing to mention whether notice under section 271 (1 )(c) issued was for concealment of income or for furnishing inaccurate particulars of income and as such penalty imposed and upheld in pursuance of an invalid notice is illegal, arbitrary & unjustified. 3. Without prejudice to the above, the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the imposition of penalty of Rs.94,42,209/- u/s 271(l)(c) of the Act which is illegal, arbitrary & unjustified. 4. That the penalty imposed under section 271 (1 )(c) of the Act is not imposable in as much as there is neither any concealment of income nor furnishing of any inaccurate particulars of income and as such the order passed under section 271(1 )(c) of the Act is illegal, arbitrary & unjustified. 5. That the order of the Ld. Commissioner of Income Tax upholding the imposition of penalty under section 271 (1 )(c) of the Act is erroneous, arbitrary, opposed to law and facts of the case and is, thus, untenable. 10. We find that in the aforesaid appeals also, the main grievance of the Assessees are that the ld. CIT(A) has dismissed the appeals of the 509 to 511-Chd-2022 – M/s Akshaj Infra Pvt Ltd., Chandigarh 7 Assessee ex-parte by upholding the orders of the AO without affording an opportunity of hearing which is against the Principals of Natural Justice. Our findings recorded while disposing of ITA No. 509/Chd/2022 are mutatis-mutandis, squarely applicable to the present appeals also and these appeals are also disposed in the same terms. 11. In the result, for statistical purposes, all these appeals are treated as allowed. Order pronounced on 26.05.2023 Sd/- Sd/- (VIKRAM SINGH YADAV) ( A.D. JAIN ) Accountant Member Vice President Dated : 26.05.2023 “आर.के.” आदेश क त*ल+प अ,े+षत / Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकर आय ु 1त/ CIT 4. +वभागीय त न5ध, आयकर अपील$य आ5धकरण, च7डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड फाईल/ Guard File आदेशान ु सार/ By order, सहायक पंजीकार/ Assistant Registrar