2019 (5) TMI 1322 - AT - Income Tax

Penalty u/s. 271(1)(c) - CIT-A exparte order - HELD THAT - There is no doubt that assessee remained non-cooperative before the lower authorities and therefore, CIT(A) has passed the exparte order, without discussing in detail the facts and circumstance of the case and also did not deal the issue on merit and passed a non-speaking order, which in my opinion, is not in accordance with the principles of natural justice and it is an erroneous approach. After reading Section 250(6), I am also of the considered view that Assessee s case should be decided on merits, which the Ld. CIT(A) has not done. Remit back the issues in dispute to the files of the Assessing Officer with the directions to consider each and every aspects of the issues involved in the Appeal and decide the same afresh, after considering the Paper Book which is containing copy of the the affidavit by authorised representative CA Pramod Singahal; PAN of the assessee; copy of letter to AO requesting copy of assessment order dated 12.5.2017; copy of letter to AO requesting copy of penalty order dated 01.5.2017; copies of medical certificate; copies of Form No. 35 for appeal filed before CIT(A) against the assessment order; copies of Form No. 35 for appeal filed before CIT(A) against the order u/s. 271(1)(c) and give adequate opportunity of being heard to the assessee. - Appeals filed by the assessee stand allowed for statistical purposes.

Summary

Issues:
Appeals against orders related to Assessment Year 2009-10 - Quantum addition and penalty u/s. 271(1)(c) of the I.T. Act, 1961.

Analysis:
The appeals were filed against the orders passed by the Ld. CIT(A), Ghaziabad, pertaining to Assessment Year 2009-10. The two appeals, one related to quantum addition and the other to penalty u/s. 271(1)(c) of the I.T. Act, were interconnected and hence heard together. The facts presented by the revenue authorities were undisputed. The counsel for the assessee argued that lower authorities erred in passing ex-parte orders without providing adequate opportunity of being heard and without following the principles of natural justice. The assessee submitted a Paper Book with various documents to support these contentions.

During the hearing, the Ld. DR supported the order of the Ld. CIT(A) stating that the assessee remained non-cooperative despite various opportunities given. However, the Ld. DR did not object to setting aside the issues for fresh consideration by the Assessing Officer. The ITAT Delhi, after hearing both parties and examining the records and relevant law provisions, found that the assessee's non-cooperation led to the ex-parte order by the Ld. CIT(A), which did not discuss the facts and circumstances in detail or address the merits of the case. The ITAT emphasized that even an administrative order must adhere to the rules of natural justice, citing a relevant Supreme Court judgment.

In light of the above considerations and agreement by both parties, the ITAT remitted the disputed issues back to the Assessing Officer for fresh consideration. The AO was directed to thoroughly review all aspects of the issues, consider the documents in the Paper Book submitted by the assessee, and provide adequate opportunity for the assessee to be heard. The assessee was instructed to cooperate with the AO, refrain from unnecessary adjournments, and submit any additional evidence to support their case. Consequently, both appeals filed by the assessee were allowed for statistical purposes.

In conclusion, the ITAT's order emphasized the importance of natural justice in administrative decisions and directed a fresh consideration of the disputed issues by the Assessing Officer, ensuring a fair opportunity for the assessee to present their case.