2015 (8) TMI 1474 - AT - Income Tax

Unaccounted income - AO treated the amount received from Niraj Jain / Pooja Expo Inc. as unaccounted income of the assessee - HELD THAT - Addition has been made without bringing any evidence on record. Also find that the CIT(A) passed exparte order on the date of hearing itself without given sufficient opportunity of being heard, which is contrary to the principle of natural justice. Therefore, in the interest of natural justice, remit back the issue in dispute to the file of the AO with the directions to decide the same afresh, under the law, after considering all the relevant evidences, after giving full opportunity to the assessee of being heard. Assessee is also directed to furnish all the evidences before the AO to substantiate his case.- Appeals filed by the assessee stands allowed for statistical purposes.

Summary

Issues involved:
Appeals against orders of Ld. Commissioner of Income Tax (Appeals) for assessment year 2005-06; Treatment of received amount as unaccounted income; Ex-parte order passed without sufficient opportunity of being heard; Addition of commission without evidence.

Analysis:
1. The appeals were filed against separate orders of the Ld. Commissioner of Income Tax (Appeals) for the assessment year 2005-06. Since the issues in both appeals were common and identical, they were disposed of by a common order for convenience.

2. The grounds of appeal in both appeals primarily revolved around the treatment of a refund received by the assessee from a party as unaccounted income, and the addition of commission without sufficient evidence. The AO treated the received amount as unaccounted income without proper evidence, leading to disputes in both cases.

3. During the hearing, the assessee's counsel argued that the AO's treatment of the amount as unaccounted income lacked evidence, and the Ld. CIT(A) passed an ex-parte order without providing adequate opportunity to be heard. On the other hand, the Ld. DR opposed these arguments and relied on the lower authorities' orders.

4. After considering the submissions and reviewing the records, the Judicial Member found merit in the assessee's contentions. It was observed that the AO had treated the amount as unaccounted income without proper evidence, and the ex-parte order by the Ld. CIT(A) was against the principles of natural justice. Consequently, the issue was remitted back to the AO for fresh consideration with directions to allow the assessee a full opportunity to present evidence.

5. The judgment concluded by allowing both appeals for statistical purposes, emphasizing the importance of natural justice and the need for proper consideration of evidence in such matters. The order was pronounced in open court on a specified date.

This detailed analysis highlights the key issues, arguments presented, judicial findings, and the ultimate decision reached by the Appellate Tribunal.