2022 (11) TMI 907 - AT - Income Tax

Ex parte order by CIT(A) - CIT(A) upheld the addition in ex parte order by taking view that three notices were served through ITBA portal but none of the notices were compiled by the assessee - assessee made submission that assessee was not well verse with the electronic gadgets and could not made compliance in time and that in future he undertakes on behalf of assessee to make proper compliance - HELD THAT - Section 250(6) of the Act mandates that the Ld. CIT(A) while deciding the appeal is required to pass order on points of determination (grounds of appeals), decision therein on and reasons for such decision. So far as objection of ld DR is concerned, that the assessee was given sufficient opportunity and that she is not eligible for further opportunity. We find that for non-compliance of the notices of lower authorities, the assessee has to bear the cost of appeal fees. Assessee has not disputed the service of notice and fairly conceded that the assessee was unable to use electronic gadgets. Considering the facts and circumstances of the present case that NFAC/Ld. CIT(A) passed ex parte order without adjudicating the grounds of appeal raised by the assessee and the assessee was not afforded fit and proper opportunity, thus, we are of the view that assessee deserves hearing on merit. Therefore, the grounds of appeal raised by assessee are restored back to the file of NFAC/Ld.

Summary

Issues:
1. Reopening of assessment under section 147
2. Ex-parte order under section 144
3. Condonation of delay in filing appeals
4. Fair opportunity of hearing to the assessee
5. Addition of bogus long term capital gain

Analysis:

1. Reopening of assessment under section 147:
The appeals were directed against separate orders of the National Faceless Appeal Centre/Ld. CIT(A) for different assessment years. The assessee challenged the reopening of assessment under section 147 by issuing notice under section 148. The Tribunal decided to club and hear all appeals together to avoid conflicting decisions. The assessee contended that the Assessing Officer erred in reopening the assessment, which led to the addition of Rs.6,58,520 as bogus long term capital gain.

2. Ex-parte order under section 144:
The NFAC/Ld. CIT(A) passed ex-parte orders without giving the assessee a fair opportunity of being heard. The Tribunal found that the orders were not in accordance with the mandate of Section 250(6) of the Act, which requires the authority to pass orders on points of determination and provide reasons for the decision. The Tribunal directed the NFAC/Ld. CIT(A) to adjudicate all grounds of appeal on merit, granting the assessee a proper opportunity of hearing.

3. Condonation of delay in filing appeals:
The assessee filed the appeals with a delay of 53 days, attributing it to the Covid-19 pandemic situation. The Tribunal considered the submissions and noted that the appeals were filed within the grace period allowed by the Supreme Court. Consequently, the delay was condoned, and the appeals were accepted for adjudication on merit.

4. Fair opportunity of hearing to the assessee:
The assessee argued that the ex-parte orders were unjust as she was not well-versed with electronic gadgets and could not comply with the notices. The Tribunal acknowledged the lack of proper opportunity for the assessee and directed the authorities to grant a fair hearing on merit, allowing the assessee to present necessary evidence and information without delay.

5. Addition of bogus long term capital gain:
The Assessing Officer treated the long term capital gains on the sale of a script as bogus and added commission paid to the operator. The NFAC/Ld. CIT(A) upheld the addition in an ex-parte order. The Tribunal found that the order was not in compliance with the Act and directed the authorities to re-adjudicate the matter, ensuring a fair and proper opportunity for the assessee.

In conclusion, the Tribunal allowed the appeals for statistical purposes, directing a fresh adjudication by the NFAC/Ld. CIT(A) in accordance with the law, ensuring the assessee's right to a fair hearing and proper consideration of all grounds of appeal on merit.