2023 (2) TMI 883 - AT - Income Tax

Ex parte order passed u/s 254(1) - non appearance by assessee - As argued assessee did not receive even a single notice fixing the hearing of the appeals and therefore could not appear before the Tribunal on the date of the hearing - HELD THAT - From the perusal of the record, we find that notices were issued to the assessee on more than one occasion including through registered post - we find no acknowledgement of receipt of notice by or on behalf of the assessee in the record. The Co ordinate Bench of the Tribunal in the absence of representation on behalf of the assessee proceeded to decide the appeals filed by the assessee ex parte qua the assessee after hearing the submissions of the Revenue and perusal of the material available on record. There was sufficient cause for non appearance on behalf of the assessee when the appeals were called for hearing. Therefore, we deem it fit and appropriate to recall the aforesaid ex parte order passed in assessee s appeals being for a fresh hearing of the appeals on merits. In view of the undertaking given by the learned A.R. that he will be appearing in the appeal hearing, the appeals are fixed for hearing on 15/02/2023, i.e., the date convenient to both parties. Miscellaneous Applications filed by the assessee are allowed.

Summary

Issues:
Recall of ex-parte order dated 18/01/2021 under section 254(1) of the Income Tax Act, 1961 due to non-appearance of assessee, sufficiency of cause for non-appearance, recall supported by an Affidavit, fresh hearing of appeals on merits, fixing the appeals for a new hearing date.

Analysis:
The Appellate Tribunal ITAT Mumbai addressed the issue of recalling a common ex-parte order dated 18/01/2021, passed under section 254(1) of the Income Tax Act, 1961, in response to Miscellaneous Applications filed by the assessee seeking a fresh hearing of their appeals. The assessee's appeals were decided ex-parte due to non-appearance, with the assessee claiming they did not receive any notice fixing the hearing and only became aware of the order after receiving a penalty notice. The Tribunal noted that notices were issued to the assessee on multiple occasions, including through registered post, but found no acknowledgment of receipt in the record. Despite the Departmental Representative opposing the recall, the Tribunal considered the submissions and the supporting Affidavit of the partner of the assessee, concluding that there was sufficient cause for non-appearance. Consequently, the Tribunal deemed it appropriate to recall the ex-parte order and scheduled a fresh hearing of the appeals on 15/02/2023, a date convenient to both parties, dispensing with the service of notice due to the pronouncement in open Court.

In its detailed analysis, the Tribunal emphasized the importance of due process and the right to be heard, acknowledging the circumstances leading to the non-appearance of the assessee and the lack of acknowledgment of receipt of notices. The Tribunal's decision to recall the order was based on the principle of fairness and ensuring that the assessee had the opportunity to present their case. By allowing the Miscellaneous Applications filed by the assessee, the Tribunal demonstrated its commitment to upholding procedural justice and providing a fair hearing to all parties involved. The recall of the ex-parte order and the scheduling of a new hearing date underscored the Tribunal's dedication to ensuring that the appeals were decided on their merits and in accordance with the principles of natural justice.