LILESH PRAKASH SABNIS,BELGAVI V. INCOME TAX OFFICER, WARD - 1(2), BELAGAVI

ITA 148/PAN/2024

AI Insights

The appeals by Lilesh Prakash Sabnis challenge the orders of the NFAC which upheld the assessments made by the Income Tax Officer for the assessment years 2009-10 and 2010-11. The assessments were reopened based on information from the ITO (Inv)-Belgaum, leading to additions under sections 69A and 69B of the Income-tax Act, 1961. The NFAC dismissed the appeals ex-parte due to the appellant's failure to provide necessary documents despite multiple notices. The Tribunal found that the notices provided less than a reasonable period of fifteen days for compliance, thus violating the principles of natural justice. Consequently, the Tribunal remanded the cases back to the NFAC for a fresh examination.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 473494 (ITAT-PANAJI)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: WT(D)
• Next Hearing Date: 08-11-2024
• Assessment Year: 2009-2010
• Appeal Filed On: 20-06-2024
• Other Referred Cases: St. Paul’s Anglo Indian Education Society (2003) 262 ITR 377 (Pat)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASSESSEE; RAVINDRA HATTALLI LD.
• Keywords: Opportunity of being heard; Principle of natural justice; Competent authority
• Section: 143(3); 250; 69B; 69A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, PANAJI ITAT-Panaji Page 1 of 5 BEFORE HON’BLE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER ITA Nos. 148 & 149/PAN/2024 Assessment Year : 2009-10 & 2010-11 Lilesh Prakash Sabnis Flat No G-2, Hariom Aashraya Apt., 2424/A, Kacheri Galli, Shahapur, Belgaum-590003. PAN:AOQPS1639M . . . . . . . Appellant V/s Income Tax Officer, Ward-1(2), Belgaum. . . . . . . . Respondent Appearances Assessee by : None for Assessee Revenue by : Mr Ravindra Hattalli [‘Ld. DR’] Date of conclusive Hearing : 08/11/2024 Date of Pronouncement : 11/11/2024 ORDER PER G. D. PADMAHSHALI, AM; These twin appeals are filed by the assessee impugning DIN & Order No. ITBA/NFAC/S/250/2024-25/1064291897(1) & 1064292605(1) both dt. 23/04/2024 passed by the first appellate authority [‘Ld. NFAC/CIT(A)’ hereinafter] u/s 250 of the Income-tax Act, 1961 [‘the Act’ hereinafter] which in turn upheld separate orders of assessment passed u/s 143(3) r.w.s. 147 of the Act by the Income Tax Officer, Ward-1(2), Belgaum [‘Ld. AO’ hereinafter] for assessment year 2009-10 & 2010-11 [‘AY’ hereinafter]; Lilesh Prakash Sabnis Vs ITO ITA Nos.148 & 149/PAN/2024 ITAT-Panaji Page 2 of 5 2. These cases were called twice separately; none appeared at the behest of the appellant, on a primary briefing from the Revenue and having considered the impugned orders, we deem it fit to advance ex-parte u/r 24 of ITAT-Rules, 1963 and adjudicate a limited issue in the absence of appellant. Recording the same, we advanced accordingly. 3. Since facts involved in this bunch of appeals and limited issue dealt therein are common & identical, on a request of Ld. DR these appeals for the sake of brevity & convenience are heard together for being disposed-off by common & consolidated order. 4. Briefly stated common facts of twin cases are that; the assessee is an individual who filed his returns for the respective assessment years under consideration on even date 25/07/2009, declaring therein the income earned/received by him from salaries, house property and other sources etc. Upon the receipt of information from the Ld. ITO (Inv)-Belgaum, the assessments of these years were re-opened after recording reasons and obtaining prior approval from the competent authority. In the event of failure on the part of the assessee to explain satisfactorily the nature & sources of money, income/investment etc., the Ld. AO made various additions u/s 69A & 69B of the Act in the respective assessments and framed the orders u/s 143(3) r.w.s. 147 of the Act vide dt. 23/12/2016. Lilesh Prakash Sabnis Vs ITO ITA Nos.148 & 149/PAN/2024 ITAT-Panaji Page 3 of 5 5. The assessee assailed aforestated additions in separate appeals before the Ld. NFAC, which were adjudicated ex-parte and dismissed. Aggrieved thereby the assessee came in present separate appeals challenging the assessments & first appellate adjudications on common grounds. 6. Without touching common grounds of appeals & merits of these cases we have heard the Ld. DR on the limited issue of ex-parte dismissal and subject to rule 18 of ITAT-Rules 1963 perused material placed on record. We note the order of assessments in these cases were passed on 23/12/2016 against which the assessee filed separate appeals before the Ld. NFAC on 11/03/2020. During the course of appellate proceedings, the assessee vide four separate notices dt. 25/02/2024, 02/03/2024, 09/03/2024 & 31/03/2024 was called upon to produce evidential documents in support of grounds appeals raised, which however remained to be complied. We also note that, except against last notice dt. 31/03/2024 which was remained un-responded, in all other cases the assessee sought adjournments. In the event the Ld. NFAC proceeded ex-parte & dismissed the appeals on the basis of facts available on record. The record further reveals us that, three out of former four notices issued during appellate proceedings calling upon the assessee to furnish evidential material were actually allowed him a period of seven days in each case. Lilesh Prakash Sabnis Vs ITO ITA Nos.148 & 149/PAN/2024 ITAT-Panaji Page 4 of 5 7. The hearings scheduled in less than a period of seven days from the date of notice ostensibly suggest that, these were not meant to accord real opportunity but to create a paper trail to showcase compliance of principle of natural justice. 8. It shall be worthy to underline that the opportunity of being heard should be real, reasonable and effective and same should not be empty or paper formalities, it should not be a paper opportunity. It is a settled & accepted principle that, any opportunity granted with a period less than a period of fifteen clear days falls out from ‘reasonable period’, thus from sufficiency of reasonable opportunity. 9. The Hon’ble High court of Patna judgement in ‘St. Paul’s Anglo Indian Education Society’ (2003) 262 ITR 377 (Pat)’ has categorically held that, an adjudication is unjustified if an assessee was deprived of reasonable opportunity and reasonable time to produce all relevant documents to substantiate claims made in the return of income. 10. In the instant twin appeals, out of four, first three notices in a row were issued since accorded less than a reasonable period of fifteen clear days to comply had the effect of depriving the assessee from reasonable opportunity and reasonable time to produce all relevant documents/evidence in support Lilesh Prakash Sabnis Vs ITO ITA Nos.148 & 149/PAN/2024 ITAT-Panaji Page 5 of 5 of grounds of appeals raised, thus suffered from principle of natural justice. In consequences thereof the impugned adjudications in our considered view since rendered irregular cannot be continued. For the reasons we deem in all the fairness and in the larger interest of justice necessary to accord one more opportunity to the appellant assessee to comply with notices and contest the appeals on merits before the Ld. NFAC, which can only be possible on remand of these cases. 11. In view of this, without offering any comments on merits of these cases, we set-aside the impugned orders and remit these files back to the stage of their institution before Ld. NFAC with a direction deal therewith de-novo and pass a speaking order in terms of section 250(6) of the Act. 12. In result, both the appeals of the assessee are allowed for statistical purposes. In terms of rule 34 of ITAT Rules, 1963 these orders are pronounced in the open court on date mentioned herein before. -S/d- -S/d- PAVAN KUMAR GADALE G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER Panaji/Dt: 11th day of November, 2024. Copy of the Order forwarded to : 1. The Appellant. 2. The Respondent. 3. The CIT(A)/NFAC Concerned 4. PCIT Concerned 5. DR, ITAT, Panaji Bench, Panaji 6. Guard File By Order, Sr. Private Secretary / AR ITAT, Panaji. "