2025 (2) TMI 918 - AT - Income Tax

Ex-parte order - non-compliance to the hearing notices issued - HELD THAT - CIT(A) proceeded to pass impugned order on 03.12.2024 ex-parte even before the time for furnishing response by the assessee has not expired. Moreover we find notices of hearing sent from Office of the First Appellate Authority was not sent to e-mail ID shown in Form No.35. Therefore there was non-compliance to the hearing notices issued from the Office of First Appellate Authority which had resulted in ex-parte order. Denial of concessional rate of tax at 22% as per provisions of section 115BAA - delay in filing Form 10-IC - HELD THAT - CBDT in its Circular No.6 of 2022 dated 17.03.2022 had stated that delay in filing Form No.10-IC as per Rule 21AE of the Rules for the previous year relevant to AY 2020-21 is condoned in cases where following conditions are satisfied - i) The return of income for AY 2020-21 has been filed on or before the due date specified u/s. 139(1) of the Act; ii) The assessee company has opted for taxation u/s/115BAA of the Act in (e) of Filing Status in Part A- GEN of the Form of Return of Income ITR-6; and iii) Form 10-IC is filed electronically on or before 30.06.2022 or 3 months from the end of the month in which this Circular is issued whichever is later. As assessee had satisfied all the aforesaid three conditions mentioned in the Board s Circular No.6 of 2022 dated 17.03.2022. In view of the assessee satisfying all the three conditions mentioned above delay in filing Form 10-IC stands condoned and accordingly the assessee would be entitled to be taxed at concessional rate of tax at 22% as per provisions of section 115BAA - Appeal filed by the assessee is allowed.

Summary

The appeal before the Appellate Tribunal involved issues related to the taxation of the appellant's income for the assessment year 2020-21 under the Income Tax Act, 1961. The key issues considered and analyzed in the judgment are as follows:**Issues Presented and Considered:**1. Whether the First Appellate Authority erred in disposing of the appeal ex parte without considering the facts and submissions made by the appellant?2. Whether the communication sent to the appellant's old email address instead of the updated one resulted in a denial of opportunity to respond?3. Whether the appellant's income was correctly taxed at 25% instead of 22% under section 115BAA of the Income Tax Act?4. Whether the order of the JCIT(A) taxing the appellant's income at 30% instead of 22% was justified?5. Whether the impugned order resulted in a reduction of legitimate refund without providing an opportunity to be heard?6. Whether the levy of interest under section 244A was just, fair, and reasonable?**Issue-Wise Detailed Analysis:**- The appellant challenged the ex parte disposal of the appeal by the First Appellate Authority, citing failure to consider submissions.- The appellant contended that the communication sent to the old email address led to a lack of awareness and inability to respond to notices.- The appellant argued that their income should have been taxed at 22% under section 115BAA, fulfilling all conditions, including filing Form 10-IC.- The appellant objected to the JCIT(A) taxing their income at 30% instead of 22%, claiming the order was void.- The appellant sought to quash the impugned order for reducing the legitimate refund without a hearing opportunity.- The appellant raised concerns about the levy of interest under section 244A, alleging it was unjust and unreasonable.**Significant Holdings:**- The Tribunal found that the appellant had satisfied all conditions mentioned in the CBDT Circular, resulting in the condonation of the delay in filing Form 10-IC.- The Tribunal held that the appellant was entitled to be taxed at the concessional rate of 22% under section 115BAA of the Act.- The appeal filed by the appellant was allowed, and the order pronounced in the open court on 20th February 2025.In conclusion, the Tribunal ruled in favor of the appellant, determining that the appellant's income should have been taxed at the concessional rate of 22% under section 115BAA of the Income Tax Act, based on the satisfaction of all conditions outlined in the CBDT Circular. The Tribunal also highlighted procedural irregularities in the handling of the case by the First Appellate Authority, leading to the appeal being allowed in favor of the appellant.