M/S CITY SHOPPE ESTATES LIMITED,KOLKATA V. DCIT, CENTRAL CIRCLE 4(3), KOLKATA

ITA 2577/KOL/2024

AI Insights

The case involves M/s City Shoppe Estates Limited appealing against an ex-parte order by the Commissioner of Income-tax (Appeals), which upheld the addition of \\u20b930 lacs to the assessee's income under section 68 of the Income Tax Act, 1961, due to non-acceptance of various compliances related to an unsecured loan. The assessee had initially failed to respond to multiple notices from the CIT(A), leading to an ex-parte decision. The Tribunal found that despite the assessee's non-compliance, the CIT(A) should have considered the merits of the case before upholding the Assessing Officer's decision. The Tribunal's decision to remand the case was based on the principles of justice and fair play, providing the assessee another opportunity to present its case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 396896 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KALLOL MISTRY
• Assessee Lawyers: DEEPAK MUNDHRA
• Keywords: Reasonable cause
• Section: 148; 142(1); 68; 139

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA BEFORE SHRI SONJOY SARMA, JM AND SHRI RAKESH MISHRA, AM ITA No. 2577/KOL/2024 (Assessment Year: 2014-15) M/s City Shoppe Estates Limited 35 Pasari House, Ballygunge Park, Kolkata-700019, West Bengal Vs. DCIT, Central Circle 4(3), Aaykar Bhavan Poorva, 110 Shanti Pally, Kolkata-700107 West Bengal (Appellant) (Respondent) PAN No. AAACJ6882A Assessee by : Shri Deepak Mundhra, AR Revenue by : Shri Kallol Mistry, DR Date of hearing: 15.05.2025 Date of pronouncement : 28.05.2025 O R D E R Per Sonjoy Sarma, JM: This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals), Kolkata-27 (hereinafter referred to as the “Ld. CIT(A)”] dated 08.12.2023 for the AY 2014-15. 02. At the outset, the ld. Authorized Representative for the assessee submitted that there is delay of 293 days in filing the appeal before this Tribunal. The reasons for delay as explained by ld. Authorized Representative is that the assessee was unaware about notices issued by the ld. CIT (A) and only came to know when the ex-parte order was passed by the ld. CIT (A). Due to this, there was an unavoidable delay Page | 2 ITA No. 2577/KOL/2024 M/s City Shoppe Estates Limited; A.Y. 2014-15 of 293 days in filing the appeal. The ld. Authorized Representative requested to condone the delay emphasizing that the delay is due to genuine and reasonable cause beyond the control of the assessee and no mala fide intention was involved for delay in filing the appeal. The ld. Authorized Representative prayed that the delay being condoned in the interest of justice, so the assessee’s case can be heard on merits. 03. We after considering the submissions made by the ld. Authorized Representative and facts placed before us, we are of the view that the delay of 293 days in filing the appeal was due to reasonable cause as explained by the assessee. The delay was due to administrative reasons and there was no deliberate attempt by the assessee to delay in filing. In the interest of justice and fair play, we hereby condone the delay in fling the appeal. The appeal will now be heard on merits. 04. Brief facts of the case are that the assessee company filed its original return of income for the A.Y. 2014-15 u/s 139 of the Act on 30.09.2014, showing total income at Rs Nil. The return of the assessee was processed u/s 143(1) of the Act. The case of the assessee was reopened u/s 148 of the Act and duly served notice to the assessee. In compliance to the notice, the assessee filed its return on 02.05.2017. Subsequently, the ld. AO issued notice u/s 143(2) and 142(1) of the Act, which were duly served upon the assessee. After getting the notice, the assessee asked the reasons for such reopening and the ld. AO provided the reasons to the assessee for reopening the case of the assessee and the objection filed by the assessee also disposed off. During the assessment proceedings, the ld. AO find that assessee received unsecured loan of ₹30 lacs from M/s Terminal Sales (P) Ltd., which was shown as loan creditor. However, the various compliances filed by the assessee in Page | 3 ITA No. 2577/KOL/2024 M/s City Shoppe Estates Limited; A.Y. 2014-15 relation with the unsecured loan received from M/s Terminal Sales (P) Ltd. was not considered by the ld. AO and added the entire amount of ₹30 lacs to the total income of the assessee u/s 68 of the Act. 05. Aggrieved with the above order, the assessee preferred the appeal before the ld. CIT (A). However, this time, the assessee has failed to comply with the notices issued by the ld. CIT (A) on various dates such as 19.10.203, 30.10.2023 and 14.11.2023 respectively. Therefore, the ld. CIT (A) has no other option but to pass an ex parte order by upholding the order of the ld. AO. 06. Aggrieved by the above order the assessee came before the Tribunal raising multiple grounds. However, primary contention of the assessee is that since the impugned order passed by the ld. CIT (A) is an ex- parte order and assessee did not get an opportunity to represent its case properly and therefore, one more opportunity may be given to the assessee so that the assessee can represent its case properly by filing supported documents before the ld. CIT (A). 07. On the other hand, the ld. DR objected to such prayer made by the assessee stating that although sufficient opportunities were given to the assessee however, assessee failed to comply to the notices issued by the ld. CIT (A). Therefore, at this stage the appeal of the assessee may be dismissed in limine by upholding the order of the ld. AO. 08. We after hearing the rival submissions of the parties and perusing the materials available on record, we find that although consecutive notices issued to the assessee however assessee failed to comply to the notices as reflected in the impugned order passed by the ld. CIT (A). However, doing so the ld. CIT (A) without going into merit of the case simply Page | 4 ITA No. 2577/KOL/2024 M/s City Shoppe Estates Limited; A.Y. 2014-15 uphold the order of the ld. AO which is not proper and therefore in the interest of justice and fair play, it is necessary to give one more opportunity to the assessee to represent its case. Therefore, we hereby remand the matter back to the file of the ld. CIT (A) with a direction to the assessee to comply to the notice issue by the ld. CIT (A) as and when notices will be served upon the assessee in remand proceeding. In terms of above, the appeal of the assessee is allowed for statistical purposes. 09. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 28.05.2025. Sd/- Sd/- (RAKESH MISHRA) (SONJOY SARMA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Kolkata, Dated: 28.05.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "