2022 (3) TMI 431 - AT - Income Tax

Deduction u/s 54F - assessee failed to produce any evidence to substantiate the claim and hence the exemption was disallowed by the AO - HELD THAT - We notice that the CIT(A) in his order has admitted the fact that the assessee s representative for the first time produced various details on 21.06.2010 - CIT (A) has infact verified these evidences but had rejected the same merely on the ground that these details should have been available with the assessee during the assessment proceedings itself and should have been produced before the AO. In our view the decision of CIT(A) on a presumptive basis is incorrect and the CIT(A) has disposed off the appeal without considering the merits of the evidences submitted. The assessee s submission that the consultant handled the assessment proceedings in an unprofessional manner also warrants consideration. Under these facts we feel it proper to restore back this matter to the file of AO for fresh decision after admitting the evidences which the assessee may like to bring on record. Appeal of the assessee is allowed for statistical purposes.

Issues:
1. Delay in serving the CIT(A) order on the Appellant
2. Recovery proceedings initiated without serving the order
3. Denial of natural justice to the Appellant
4. Attachment of bank accounts without notice
5. Disallowance of exemption under section 54F
6. Levy of interest under sections 234B and 234D
7. Initiation of penalty proceedings under section 271(1)(c)

Delay in serving the CIT(A) order on the Appellant:
The appeal challenged the delay in serving the CIT(A) order on the Appellant, leading to recovery proceedings and bank account freezing without prior notice. The Appellant argued that multiple attempts were made to obtain the order, but it was received late from the AO. The Tribunal, after considering the evidence and lack of fault on the Appellant's part, condoned the delay and admitted the appeal for adjudication on merits.

Denial of natural justice to the Appellant:
The Appellant contended that natural justice was denied as the order was passed without providing an opportunity to be heard. The Tribunal acknowledged the Appellant's efforts to obtain the order and found no intentional delay. Consequently, the delay was condoned, and the appeal was accepted for further consideration.

Disallowance of exemption under section 54F:
The dispute arose from the disallowance of exemption claimed under section 54F by the AO and upheld by the CIT(A). The Appellant argued that due to unprofessional handling of proceedings, necessary details were not submitted before the AO. Despite submitting evidence to the CIT(A), the claim was rejected. The Tribunal observed that the CIT(A) did not consider the merits of the evidence and decided on presumptive grounds. In the interest of justice, the matter was remanded to the AO for fresh consideration after allowing the Appellant to present additional evidence.

Levy of interest under sections 234B and 234D:
The Appellant contested the levy of interest under sections 234B and 234D, which was upheld by the CIT(A). The Tribunal did not comment on the merits of this issue due to the decision to remand the matter to the AO. As a result, the appeal was allowed for statistical purposes, without further discussion on the interest levied.

Initiation of penalty proceedings under section 271(1)(c):
The Appellant challenged the initiation of penalty proceedings under section 271(1)(c) by the Assessing Officer, which was upheld by the CIT(A). However, the Tribunal did not delve into this issue as the main matter was remanded to the AO for fresh consideration. Therefore, the appeal was allowed for statistical purposes without specific commentary on the penalty proceedings.

This detailed analysis highlights the key issues raised in the appeal before the Appellate Tribunal ITAT BANGALORE and the Tribunal's decisions on each matter, providing a comprehensive overview of the judgment.

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