UNITY FORGE PRIVATE LIMITED,KANCHIPURAM V. ITO, CORPORATE CIRCLE 3(1), CHENNAI, CHENNAI

ITA 2177/CHNY/2024

AI Insights

The case involves M/s. Unity Forge Pvt. Ltd., which appealed against the order of the Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi, confirming an ex-parte order passed by the A.O. The A.O had made an addition of miscellaneous expenses amounting to Rs.24,44,170/- to the assessee's declared loss of Rs. 4,41,59,301/- for the assessment year 2021-22, without awaiting a response to a show cause notice. The CIT(A) upheld this addition, relying on a previous ITAT order. The Tribunal found that both the A.O and CIT(A) had not considered the assessee's reply and had not decided the case on its merits, thus violating the principles of natural justice.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 107280 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 21-10-2024
• Assessment Year: 2021-2022
• Appeal Filed On: 16-08-2024
• Other Referred Cases: CIT vs. Multiplan India Pvt. Ltd. reported in 38 ITD 320 (Delhi)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.ANITA
• Assessee Lawyers: SIDDHARTH MALLINATHAN
• Keywords: Set aside; Principle of natural justice
• Section: 143(3)

Judgement Text

"आयकर अपीलीय अिधकरण, ‘सी’ \u0011ा यपीठ, चे\u0016ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI \u0019ी महा वीर िसंह, उपा \u001f एवं \u0019ी जगदीश, लेखा सद' क े सम BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2177/Chny/2024 िनधा 9रण वष9 /Assessment Year: 2021-22 M/s. Unity Forge Pvt. Ltd., D-10, Industrial Estate, Maraimalai Nagar S.O., Kanchipuram – 603 209. [PAN: AAACU 0829N] Vs. The Income Tax Officer, Corporate Circle-3(1), Chennai. (अपीलाथ\u0007/Appellant) (\b\tयथ\u0007/Respondent) अपीला थE की ओर से/ Appellant by : Shri Siddharth Mallinathan, Advocate GHथE की ओर से /Respondent by : Ms. R. Anita, Addl. CIT सुनवा ई की ता रीख/Date of Hearing : 21.10.2024 घोषणा की ता रीख /Date of Pronouncement : 21.10.2024 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee is against the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] date18.06.2024 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s.143(3) r.w.s 144B of the Income Tax Act, 1961 (hereinafter “the Act”) on 21.12.2022. ITA No.2177/Chny/2024 :- 2 -: 2. The only effective ground of appeal in this appeal of assessee is against the order of Ld. CIT(A) in confirming the ex-parte order passed by A.O. 3. The assessee-company has filed return of income declaring loss of Rs. 4,41,59,301/-. The A.O has passed order u/s. 143(3) of the Act making addition of miscellaneous expenses of Rs.24,44,170/- without awaiting reply of show cause notice. On appeal, the Ld. CIT(A) has confirmed the addition without going into merits of the case relying on the order of ITAT, Delhi in the case of CIT vs. Multiplan India Pvt. Ltd. reported in 38 ITD 320 (Delhi). 4. The Ld. Authorized Representative (A.R) of the assessee before us has submitted that the A.O has issued show cause notice on 07.12.2022 and the assessee sought adjournment till 24.12.2022. However, the A.O has passed order on 21.12.2022 without waiting for assessee’s response. The Ld. AR has submitted that the Ld. CIT(A) has also passed order ex-parte without providing opportunity and deciding the case on merits. Therefore, prayed to restore the matter back to the A.O. 5. The Ld. Departmental Representative (DR), on the other hand, has relied on the orders of lower authorities. ITA No.2177/Chny/2024 :- 3 -: 6. We have heard the rival submissions, and perused the materials available on record. On perusal of the order of the A.O, we find that the order has been passed without considering reply of the assessee while making disallowance of Rs. 24,44,170/-. The Ld. CIT(A) has not decided the case on merit and dismissed the appeal ex-parte. We are of the opinion that keeping in view the principles of natural justice, the assessee be provided with another opportunity of hearing to substantiate his case before the A.O. Accordingly, we set aside the orders passed by the lower authorities and remit the matter back to the file of the A.O to adjudicate this appeal afresh in accordance with law, after giving reasonable opportunity to the assessee. We also direct the assessee to appear before the A.O on the date of hearing without fail. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only. 7. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 21st October, 2024. Sd/- Sd/- (महा वीर िसंह) (Mahavir Singh) उपा \u001f / Vice President (जगदीश) (Jagadish) लेखा लेखा लेखा लेखा सद\u0011य सद\u0011य सद\u0011य सद\u0011य /Accountant Member चे\u0013नई/Chennai, \u0016दनांक/Dated: 21st October, 2024. EDN/- ITA No.2177/Chny/2024 :- 4 -: आदेश क\u0019 \bितिल\u001cप अ\u001dे\u001cषत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b\tथ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Chennai 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF "