2024 (6) TMI 970 - AT - Income Tax

Ex parte order passed by CIT(A) - non considering the ground of the assessee - addition of Unexplained income as per provision of section 69 and 69A - levying of tax u/s 115BBE - AR vehemently argued and placed that the number of dates is allotted by the ld. CIT(A) for hearing, the adjournment petition was filed but only for the dates 14.07.2022, 05.01.2023 and 08.08.2023 the ld. CIT(A) mentioned that none appeared - HELD THAT - The appeal was passed ex parte though the ld. CIT(A) had allowed number of dates to the assessee but the assessee specifically claimed that some of the dates the notice was not received and some of the dates the adjournment petition was filed. AR further claimed that the ld. CIT(A) passed the ex parte order without considering the ground of the assessee. Both the merit and the legal grounds are not considered during passing of appeal order. The ld. AR prayed for set aside the matter to the file of the ld. CIT(A) for further adjudication de novo,considering the grounds filed by the assessee. DR had not made any objection against the submission of the ld. AR. We are, therefore, of the opinion that interest of justice would be sub served if the impugned order is set aside and the matters are remitted back to the ld. CIT(A) for consideration thereof afresh. We are not expressing any views on the merits of the case so as to limit the appellate procedure before the Ld. CIT(A). Needless to say, the assessee should get a reasonable opportunity of hearing for setting aside proceedings. Appeal of the assessee is allowed for statistical purposes.

Summary

Issues Involved:
The issues involved in this case are the dismissal of the appeal by the ld. CIT(A) without considering the grounds filed by the assessee and without providing a reasonable opportunity of hearing, leading to the appeal before the Appellate Tribunal ITAT Amritsar.

Issue 1: Dismissal of Appeal by CIT(A) without Considering Grounds:
The appeal was filed against the order of the ld. Commissioner of Income Tax (Appeals)-5, Ludhiana, under section 250(6) of the Income Tax Act 1961 for A.Y. 2019-20. The assessee contended that the CIT(A) erred in dismissing the appeal in liminee without deciding it on merit based on detailed Grounds of Appeal and Statement of Facts, even if it was to be decided exparte. The CIT(A) dismissed the appeal exparte, allegedly ignoring the fact that the assessee had applied for adjournment, thus violating the principles of natural justice. The appellant further argued that the order framed by the CIT(A) was bad in law and on facts. The appellant requested leave to add or amend the grounds of appeal before the appeal was heard and disposed of.

Issue 2: Assessment and Tax Levying Discrepancies:
A survey conducted at the assessee's business premises under section 133A of the Act revealed discrepancies between physical quantities and entries in the books of account. Consequently, the assessee surrendered an amount of Rs.95,00,160 before the survey authority. The assessment was made under section 143(3), and the declared amount was taxed at a special rate as per section 115BBE of the Act, treating the entire amount as unexplained income under sections 69 and 69A. The assessee, aggrieved by the tax levied under section 115BBE, filed an appeal before the ld. CIT(A), who passed an exparte order upholding the assessment without considering the amounts. This led to the appeal before the Appellate Tribunal.

Judgment Summary:
The Appellate Tribunal ITAT Amritsar allowed the appeal for statistical purposes, setting aside the order of the ld. CIT(A) and remitting the matter back for further adjudication de novo. The Tribunal held that the CIT(A) had dismissed the appeal without considering the grounds filed by the assessee and without providing a reasonable opportunity of hearing, violating the principles of natural justice. The Tribunal emphasized that both the merit and legal grounds were not considered during the passing of the appeal order. The matter was remitted back to the ld. CIT(A) for fresh consideration, ensuring the assessee gets a reasonable opportunity of hearing. The Tribunal refrained from expressing any views on the merits of the case to allow for a fair appellate procedure before the ld. CIT(A). The appeal was allowed for statistical purposes, with the order pronounced in the open court on 11.01.2024.