NAHID KHATOON,HYDERABAD V. ACIT., CIRCLE-14(1), HYDERABAD

ITA 1135/HYD/2025

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Ms. Nahid Khatoon filed an appeal against the order of the Ld. CIT(A), which dismissed her appeal concerning a penalty order under section 271(1)(c) of the Income Tax Act, 1961 for the assessment year 2016-17. The dismissal was based on her expressed willingness to opt for the Vivad Se Vishwas Scheme (VSVS), which she later did not avail. The Tribunal noted that the Ld. CIT(A) dismissed the appeal without further notice or opportunity for the assessee to present her case, leading to a violation of natural justice. The Tribunal decided to set aside the CIT(A)'s order and remand the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 775596 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2016-2017
• Appeal Filed On: 05-07-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACHIN KUMAR
• Assessee Lawyers: P. VINOD
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice
• Section: 271(1)(c)

Judgement Text

" आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘B’ Bench, Hyderabad श्री विजय पाल राि, उपाध् यक्ष एिं श्री मिुसूदन सािडिया, लेखा सदस् य क े समक्ष । BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.1135/Hyd/2025 (निर्धारण वर्ा/Assessment Year:2016-17) Ms. Nahid Khatoon, Hyderabad. PAN: ACBPK8929M Vs. Asst. Commissioner of Income Tax, Circle 14(1), Hyderabad. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri P. Vinod, Advocate रधजस् व द्वधरध/Revenue by: Dr. Sachin Kumar, SR-DR सुिवधई की तधरीख/Date of hearing: 08/09/2025 घोर्णध की तधरीख/Pronouncement: 08/09/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by Ms. Nahid Khatoon (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 27.05.2025 for the A.Y. 2016-17. 2. The assessee has raised the following grounds of appeal : Printed from counselvise.com ITA No.1135/Hyd/2025 2 “ 1. On the facts and in the circumstances of the case, the order of the Ld. CIT(A) is erroneous and unsustainable in law apart from being passed in violation of principles of natural justice. 2. Without prejudice to the above, the Ld. CIT(A) erred in dismissing the appeal on the alleged ground that the appellant filed written submission expressing the view for opting VSVS. 3. The Ld. CIT(A) failed to appreciate that the appellant expressed such view on 25.08.2020, but could not opt for the scheme and that the Ld. CIT(A) proceeded to dismiss the appeal on 27.05.2025, without verifying about whether the appellant had opted for VSVS or not and further erred in dismissing the appeal without giving any opportunity to the appellant. 4. Any other ground that may be urged at the time of hearing.” 3. The brief facts of the case are that, the assessee had filed an appeal before the Ld. CIT(A) against the penalty order passed by the Learned Assessing Officer (“Ld. AO”) under section 271(1)(c) of the Income Tax Act, 1961 (“the Act”) dated 28.06.2019 for the assessment year 2016-17. During the appellate proceedings, on 25.08.2020, the assessee submitted before the Ld. CIT(A) that he would be opting for the Vivad Se Vishwas Scheme (“VSVS”) and accordingly requested that the matter be kept in abeyance. However, the Ld. CIT(A) dismissed the appeal of the assessee holding that since the assessee had filed a written submission expressing willingness to opt for VSVS, nothing further survived in the appeal. Aggrieved by Printed from counselvise.com ITA No.1135/Hyd/2025 3 the order of Ld.CIT(A), the assessee has filed the present appeal before the Tribunal. 4. The Learned Authorised Representative (“Ld. AR”) submitted that when the appeal was pending before the Ld. CIT(A), the assessee had made a categorical request dated 25.08.2020 stating that he was willing to opt for VSVS, and accordingly requested the Ld. CIT(A) to keep the matter in abeyance. However, the assessee later did not avail the VSVS. He further submitted that the Ld. CIT(A) dismissed the appeal on 27.05.2025, i.e., almost five years after the assessee’s submission regarding VSVS. The last notice issued by the Ld. CIT(A) was dated 06.01.2021, and since then no further opportunity of hearing was afforded to the assessee. It was argued that the impugned order suffers from violation of the principles of natural justice as no effective opportunity was given to the assessee to put forth his case. Accordingly, the Ld. AR prayed that the matter may be restored to the file of the Ld. CIT(A) with a direction to grant one more opportunity to the assessee to file documentary evidence and explanation in support of his claim and decide the appeal on merits. 5. Per contra, the Learned Departmental Representative (“Ld. DR”) relied on the order of the Ld. CIT(A). 6. We have considered the rival submissions and gone through the material available on record. It is undisputed that the assessee had filed a written submission dated 25.08.2020 before the Ld. CIT(A) expressing willingness to opt for VSVS. However, it is also a matter Printed from counselvise.com ITA No.1135/Hyd/2025 4 of record that no further notice was issued to the assessee after 06.01.2021, and the appeal was eventually dismissed on 27.05.2025, after a gap of almost four years. On perusal of the impugned order, we find that the Ld. CIT(A) has dismissed the appeal solely on the ground that the assessee had expressed willingness to opt for VSVS, without examining whether the assessee had actually availed the said scheme or not. In our considered view, dismissal of the appeal without affording adequate opportunity to the assessee amounts to violation of the principles of natural justice. Therefore, in the interest of justice, we set aside the impugned order and restore the matter to the file of the Ld. CIT(A) with a direction to grant one more opportunity of being heard to the assessee. The assessee is also directed to cooperate with the appellate proceedings and not to seek unnecessary adjournments. 7. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 8th Sept., 2025. Sd/- Sd/- (VIJAY PAL RAO) (MADHUSUDAN SAWDIA) VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad. Dated: 08.09.2025. * Reddy gp Printed from counselvise.com ITA No.1135/Hyd/2025 5 Copy of the Order forwarded to : 1. Ms. Nahid Khatoon, 8-2-598/B/5, Road No.8, Banjara Hills, Hyderabad-500 034 2. The ACIT, Circle 14(1), Hyderabad. 3. Pr.CIT, Hyderabad. 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, Printed from counselvise.com "