2014 (8) TMI 522 - AT - Income Tax

Ex-parte order passed by CIT(A) Additional evidences filed before CIT(A) - Held that - The proceedings before the AO as well as before the CIT(A) were completed ex parte and assessee could not get due opportunity of hearing during these proceedings before the authorities below - the AO completed reassessment proceedings u/s 144 of the Act ex parte and assessee submitted additional evidence before the CIT(A) under Rule 46A of the Income Tax Rules, 1962 which was also not considered as the appeal was also dismissed ex parte - the CIT(A) has dismissed ten grounds of appeal by passing a very short and cryptic order without assigning any reason for adjudication on all issues placed before him by the assessee - when a quasi-judicial authority deals with a lis, it is obligatory on its part to ascribe cogent and justified reasons as the same is the heart and soul of the matter and the same also facilitates appreciation when the order is called in question before the superior forum. CIT(A) has not passed a speaking and well-reasoned order on various issues/grounds raised by the assessee - it would be just and proper to set aside the order of CIT(A) as well as ex parte assessment order passed by the AO concerned - the assessee also filed additional evidence before CIT(A) which was not considered while passing order thus, the matter is to be remitted back to the AO for fresh adjudication Decided in favour of Assessee.

Issues involved:
1. Appeal against order of CIT(A)-XV, New Delhi dated 3.9.2012 in Appeal No. 367/11-12/CIT(A)- XV pertaining to AY 2004-05 passed u/s 144/147 of the Income Tax Act, 1961.
2. Consideration of additional evidence by CIT(A) and denial of opportunity of hearing.
3. Completing assessment ex parte u/s 144 of the Act.
4. Dismissal of appeal by CIT(A) without providing due opportunity of hearing.
5. Non-speaking order by CIT(A) and lack of reasoning.
6. Requirement of well-reasoned and speaking order by CIT(A).
7. Setting aside the order of CIT(A) and ex parte assessment order for fresh adjudication.
8. Allowing certain grounds for statistical purposes and dismissing remaining grounds.

Detailed Analysis:
1. The appellant filed an appeal against the CIT(A)'s order related to the assessment year 2004-05 under the Income Tax Act, 1961. The appeal raised concerns regarding the denial of opportunity for presenting additional evidence, completion of assessment ex parte, and the dismissal of the appeal without proper hearing.
2. The appellant contended that the AO completed the assessment ex parte under section 144, leading to the submission of additional evidence before the CIT(A) under Rule 46A. The appellant's representative was unable to attend the hearing due to a traffic jam caused by a rally, which was beyond their control. The CIT(A) dismissed the appeal without considering the additional evidence, violating the appellant's right to be heard.
3. The Department argued that non-cooperation from the appellant led to the ex parte completion of proceedings by the revenue authorities. However, they expressed willingness to remit the case for fresh adjudication if deemed necessary for justice.
4. The Tribunal observed that both the AO and CIT(A) concluded the proceedings ex parte, depriving the appellant of a fair hearing. The CIT(A) failed to provide a reasoned order and dismissed the appeal without addressing the grounds raised, contrary to the requirement under section 250(6) for a well-reasoned decision.
5. Citing the unrebutted affidavit of the appellant's representative and legal precedents, the Tribunal found a valid reason for the representative's absence during the CIT(A) hearing. The lack of proper reasoning in the CIT(A)'s order and the failure to consider additional evidence necessitated setting aside the order for fresh adjudication.
6. The Tribunal allowed certain grounds for statistical purposes, considering the appellant's right to a fair hearing, and dismissed the remaining grounds as they were contingent on the fresh adjudication ordered.
7. The Tribunal emphasized the importance of providing a reasoned and speaking order in quasi-judicial proceedings, ensuring fairness and facilitating higher-level review of decisions.

This detailed analysis highlights the issues raised in the legal judgment and the Tribunal's decision to set aside the CIT(A)'s order for fresh adjudication due to procedural irregularities and lack of proper reasoning in the initial assessment.

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