RAJAN RAJKUMAR,NILGIRIS V. ASSESSING OFFICER, OOTY, TAMILNADU

ITA 2549/CHNY/2024

AI Insights

This case involves an appeal by Mr. Rajan Rajkumar against the order of the Learned Commissioner of Income Tax (Appeals), Delhi, which confirmed an ex parte order passed by the AO under sections 144/147 of the Income Tax Act, 1961. The AO had made several additions to the assessee's income, which were contested. The CIT(A) dismissed the additional evidence provided by the assessee, leading to the appeal. The Tribunal, referencing the decision of the Hon'ble Supreme Court in TIN Box Co. v. CIT, emphasized the need for a fair hearing and proper consideration of all evidence, thereby setting aside the CIT(A)'s order and restoring the matter to the AO for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 107494 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Other Referred Cases: TIN Box Co. v. CIT [2001] 249 ITR 216 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CLEMENT RAMESH KUMAR
• Assessee Lawyers: KARUNANANTHAM
• Keywords: Set aside; Additional evidence

Judgement Text

"आयकर अपीलीय अिधकरण, ’सी’ \u0001यायपीठ, चे\tई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI \u0001ी एबी टी. वक , \u000bाियक सद\u0011 एवं एवं एवं एवं \u0001ी जगदीश, लेखा सद\f क े सम\u0015 BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2549/Chny/2024 िनधा\u000eरणवष\u000e/Assessment Year: 2018-19 Mr.Rajan Rajkumar, 5/39-D, Honni House Corsely Road, Kotagiri, Nilgiris-643 217. v. The ITO, Ward-1 Ooty. [PAN: BARPR 7043 A] (अपीलाथ\u0016/Appellant) (\u0017\u0018यथ\u0016/Respondent) अपीलाथ\u0016 क\u001a ओर से/ Appellant by : Mr.Karunanantham, Advocate \u0017\u0018यथ\u0016 क\u001a ओर से /Respondent by : Mr.Clement Ramesh Kumar, CIT सुनवाईक\u001aतारीख/Date of Hearing : 26.12.2024 घोषणाक\u001aतारीख /Date of Pronouncement : 31.01.2025 आदेश / O R D E R PER ABY T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter in short \"the Ld.CIT(A)”), Delhi, dated 04.08.2024 for the Assessment Year (hereinafter in short \"AY”) 2018-19 confirming the ex parte order passed by the AO u/s.144/147 of the Income Tax Act, 1961 (hereinafter in short \"the Act”). 2. At the outset, the Ld.AR submitted that the AO has framed the assessment order, by making the following three additions i) addition ITA No.2549/Chny/2024 (AY 2018-19) Mr.Rajan Rajkumar :: 2 :: u/s.69A for Rs.3,14,22,231/- ii) interest income added Rs.4,210/- & iii) addition u/s.69 of the Act of Rs.27,50,000/-. According to the Ld.AR, since the AO had passed best judgment assessment/ex-parte order u/s.144 of the Act, the assessee had filed additional evidences before the Ld.CIT(A) [which fact is discernable from Page No.19 of the impugned order] but, the Ld.CIT(A) has brushed aside the same on technical grounds and thus confirmed the ex parte order passed by the AO dated 25.01.2024. 3. Aggrieved by the aforesaid action of the Ld.CIT(A), the assessee preferred has preferred this appeal before us. 4. We have heard both the parties and perused the material available on record. The main plea of the assessee is that the impugned action of the Ld.CIT(A) is not legally sustainable for violation of principle of natural justice. It is noted that despite the assessee filing additional evidences, the Ld.CIT(A) has brushed it aside on hyper technical grounds which are legally unsustainable, which led to the confirmation of additions made by the AO passing best judgment assessment u/s.144/ex parte order. Therefore, the impugned action of the Ld.CIT(A) can’t be countenanced. 5. Having said so, we note that as per the scheme of the Income Tax Act, the primary authority vested with the power to determine the correct taxable income of an assessee is the AO; and since in the present case, it ITA No.2549/Chny/2024 (AY 2018-19) Mr.Rajan Rajkumar :: 3 :: is undisputed that best judgment assessment has been framed by the AO without hearing the assessee, we are of the view that one more opportunity should be given to the assessee for which we rely on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC) and set aside the impugned order of the Ld.CIT(A) and restore the assessment back to the file of the AO for de novo assessment. Having said so, we levy cost of Rs.5,000/- which the assessee should remit to the State Legal Aid Authority, Hon’ble Madras High Court, and produce necessary proof of depositing of the same before the AO; and thereafter, the AO to frame the de novo assessment after hearing the assessee in accordance to law. The Ld.AR undertakes to file written submissions/relevant documents before the AO and diligently participate in the assessment proceedings, which we expect the Ld.AR to do and if there is any omission on his part, the AO is at liberty to take appropriate action in accordance to law. 6. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced on the 31st day of January, 2025, in Chennai. Sd/- Sd/- (जगदीश) (JAGADISH) लेखा सद\f/ACCOUNTANT MEMBER (एबी टी. वक ) (ABY T. VARKEY) \u0001याियक सद\bय/JUDICIAL MEMBER ITA No.2549/Chny/2024 (AY 2018-19) Mr.Rajan Rajkumar :: 4 :: चे\tई/Chennai, !दनांक/Dated: 31st January, 2025. TLN, Sr.PS आदेश क\u001a \u0017ितिलिप अ$ेिषत/Copy to: 1. अपीलाथ\u0010/Appellant 2. \u0011\u0012थ\u0010/Respondent 3. आयकरआयु\u0018/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय\u0011ितिनिध/DR 5. गाड फाईल/GF "