2023 (5) TMI 1062 - AT - Income Tax

CIT-A dismissed the appeal ex-parte - HELD THAT - As assessee has raised grounds of appeal challenging the additions of the A.O and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the principles of natural justice shall provide one more opportunity of hearing to the assessee to substantiate the case with evidences and information. Accordingly, set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal. Grounds of appeal of the assessee for statistical purposes.

Summary

Issues involved:
The issues involved in this judgment are related to adhoc disallowance made under section 143(1) and rectification under section 154, violation of natural justice, adequacy of opportunity of hearing, and passing of a speaking order by the Commissioner of Income-tax (Appeals) - National Faceless Appeal Centre.

Adhoc Disallowance u/s 143(1) and Rectification u/s 154:
The assessee, a cooperative housing society, filed an appeal against the order of the Commissioner of Income-tax (Appeals)-National Faceless Appeal Centre, Delhi. The appeal was made against the adhoc disallowance of Rs. 4,70,220/- in the intimation u/s 143(1) and rectification u/s 154. The assessee contended that the disallowance was made due to faulty computerized processing without considering all facts. The Tribunal set aside the order of the CIT(A) and remitted the disputed issues for fresh adjudication, emphasizing the principles of natural justice and providing adequate opportunity of hearing to the assessee.

Violation of Natural Justice:
The assessee raised concerns regarding the violation of natural justice as they were not provided with a show cause notice by the CIT(A), NFAC. The Tribunal acknowledged the importance of natural justice and decided to provide the assessee with another opportunity of hearing to substantiate their case with evidence and information. The order of the CIT(A) was set aside, emphasizing the need for fair proceedings and compliance with the principles of natural justice.

Adequacy of Opportunity of Hearing:
The Tribunal noted that the CIT(A) had issued notices of hearing to the assessee, but there was no response leading to the dismissal of the appeal ex-parte. However, considering the possibility of various reasons for non-appearance, the Tribunal decided to provide the assessee with another opportunity of hearing. It emphasized the importance of granting adequate opportunity of hearing to the assessee for early disposal of the appeal, ensuring fair proceedings and compliance with legal principles.

Passing of Speaking Order:
The Tribunal observed that the CIT(A) had dismissed the appeal without passing a speaking order on merits and without providing sufficient opportunity of hearing to the appellant. In light of this, the Tribunal set aside the order of the CIT(A) and directed the entire disputed issues to be remitted for fresh adjudication, emphasizing the necessity of passing a speaking order on merits and granting sufficient opportunity of hearings/submissions to the appellant for a fair and just decision.

Conclusion:
In conclusion, the Tribunal allowed the appeal filed by the assessee for statistical purposes, highlighting the importance of fair proceedings, compliance with natural justice, and providing adequate opportunity of hearing to ensure a just and reasoned decision in tax matters.