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2019 (4) TMI 2104 - AT - Income TaxCIT(A) passed ex parte order - Addition u/s 69 - HELD THAT - From perusal of the order of the ld. CIT(A), it is clear that he has not decided the issue on merit and had just upheld the order of the A.O. on the plea that the appellate authority cannot substitute its own judgment in place of the judgment of the A.O. unless it is shown that the judgment of the A.O. was biased, irrational, vindictive or capricious. As per provisions of Section 250(6) CIT(A) has to pass order in writing giving reasons for his conclusion. However, the order passed by the ld. CIT(A) are not in terms of provisions of Section 250(6) of the Act. Therefore, in the substantial interest of justice, we set aside the ex parte order of the CIT(A) and restore the matter back to the file of the CIT(A) for deciding the issue afresh after providing reasonable and effective hearing to the assessee. The assessee is also directed to appear before the ld. CIT(A) within a period of two months from the date of receipt of this order. We order accordingly.
Issues involved:
1. Reopening of assessment and addition made under Section 69 of the Income Tax Act. 2. Ex parte order by the ld. CIT(A) without providing a reasonable opportunity of hearing to the assessee. 3. Failure of the ld. CIT(A) to decide the issue on merit and not passing the order in accordance with the provisions of Section 250(6) of the Act. Analysis: Issue 1: Reopening of assessment and addition under Section 69: The appeal was filed by the assessee against the ex parte order of the ld. CIT(A)-3, Jaipur for the assessment year 2009-10 regarding the order passed under Section 143(3) read with Section 148 of the Income Tax Act, 1961. The assessee contested the reopening of assessment and the addition of Rs. 5,22,560 made under Section 69 of the Act. Issue 2: Ex parte order without providing a reasonable opportunity of hearing: The assessee argued that the ld. CIT(A) had passed the ex parte order without giving a reasonable opportunity of hearing. It was claimed that no notice was served at the address provided by the assessee in Form No. 35 filed before the ld. CIT(A). An affidavit supporting this claim was also submitted. Issue 3: Failure to decide on merit and non-compliance with Section 250(6) of the Act: Upon reviewing the orders of the authorities below, it was observed that the ld. CIT(A) did not decide the issue on merit but merely upheld the order of the Assessing Officer (A.O.) citing that the appellate authority cannot substitute its judgment unless the A.O.'s decision was biased, irrational, vindictive, or capricious. However, it was noted that the ld. CIT(A) did not pass the order in accordance with the provisions of Section 250(6) of the Act, which requires a written order with reasons for the conclusion. In the interest of justice, the ex parte order was set aside, and the matter was remanded back to the ld. CIT(A) for a fresh decision after providing a reasonable and effective hearing to the assessee. In conclusion, the appeal of the assessee was allowed for statistical purposes only, and the assessee was directed to appear before the ld. CIT(A) within two months from the date of receipt of the order. The judgment was pronounced in the open court on 8th April 2019.
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