2014 (7) TMI 377 - AT - Income Tax

Notice of hearing not received - Held that - The principles of natural justice are not complied with by the CIT(Appeals)-IV, New Delhi - revenue could not demonstrate that the notices were served on the assessee - the appeal should be set aside to the file of the CIT(Appeals) for fresh adjudication in accordance with law, after affording adequate opportunity of hearing to the assessee thus, the matter is remitted back to the CIT(A) for fresh adjudication Decided in favour of Assessee.

Summary

Issues involved:
1. Addition of share application money and presumed commission confirmed by Ld.CIT(A).
2. Non-receipt of notice of hearing by the appellant.
3. Granting of adjournment application.
4. Compliance with principles of natural justice by Ld.CIT(A).

Issue 1: Addition of share application money and presumed commission:
The appeal was filed against the Ld.CIT(A)'s order confirming the addition of Rs. 5,02,500 on account of share application money and presumed commission. The appellant contested this addition, claiming it was erroneous both in law and on facts. However, the Tribunal did not delve into the merits of this addition due to other procedural irregularities.

Issue 2: Non-receipt of notice of hearing:
The appellant argued that it did not receive any notice of hearing from the Ld.CIT(A). Despite the appellant receiving the appellate order, it claimed non-receipt of specific notices on various dates mentioned by the Ld.CIT(A). The Tribunal found merit in this argument, highlighting the importance of adherence to principles of natural justice and the right to be heard. Consequently, the Tribunal set aside the appeal and directed the appellant to obtain the notice of the date of hearing for fresh adjudication.

Issue 3: Granting of adjournment application:
During the hearing, the assessee requested an adjournment, which was denied by the Tribunal. The Tribunal deemed it inappropriate to grant the adjournment, indicating a strict stance on procedural matters and timely conduct of proceedings.

Issue 4: Compliance with principles of natural justice:
After hearing the arguments, the Tribunal concluded that the principles of natural justice were not adhered to by the Ld.CIT(A). The Tribunal emphasized the importance of ensuring that the appellant receives proper notice of the hearing to exercise their right to be heard. In light of this, the Tribunal decided to set aside the appeal for fresh adjudication, emphasizing the need for a fair and just process in line with the law.

Overall, the appeal was treated as allowed for statistical purposes, with the Tribunal focusing on procedural irregularities and the importance of upholding principles of natural justice throughout the adjudicatory process.