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2018 (12) TMI 313

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..... th the appeals, the Ld. CIT(A) has passed the order ex- parte and not on merit. The stand of the assessee was that the notices for the hearing have been sent to the Kathua address where the assessee was doing work, had already been closed, however, the notices were never been served at Delhi address which is specifically mentioned by the assessee in Form No.35. The assessee has also filed an affidavit in support of its contention. The Bench even verified the appellate record of the Ld. CIT(A) and found that the notices were never been sent/served at Delhi address which is mentioned in Form No.35. As proper notices have not been served to the assessee, therefore, the assessee did not get reasonable and proper opportunities of being heard and even otherwise the Ld. CIT(A) did not pass the orders on merit, hence, proper course would be to set aside the cases to the files of the Ld. CIT(A) to decide afresh while affording reasonable and proper opportunities of being heard to the assessee. Hence ordered accordingly. Assessee's appeals allowed for statistical purposes. - I. T. A. Nos. 481 And 482/(Asr)/2017 - - - Dated:- 26-11-2018 - SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N. K .....

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..... mar, the person who had signed Form 36, the form of appeal before the Tribunal for both the appeals), to the effect that the notices issued during the appellate proceedings (before the ld. CIT(A)) were not served at the Delhi (HO) address specifically mentioned in Form 35. A perusal of the appeal files, produced during hearing, revealed that the notices of hearing were indeed addressed to the Kathua address. However, there was a letter dated 17/1/2017 by the assessee, seeking adjournment, in both the appeal files, which was read out by the ld. DR. the same clearly implies that the assessee had received the notice/s of hearing, and in both the appeals, which were in fact concurrently under hearing before the ld. CIT(A), rebutting the assessee s statement before us as well as it s affidavit dated 13/8/2018 which, as its close reading reveals, is restricted by the assessee only to the quantum appeal. Sh. Arora would, upon this, state that the same, however, does not materially alter the assessee s case in-as-much as it may be that the assessee had received one or two of the (several) notices of hearing, but that does not translate into provision of adequate opportunity of hearing by .....

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..... n thereto, with the view to extend opportunity, the validity of the notices in one case would imply the receipt of notices in the other (quantum) proceedings as well. This is particularly so as the assessee has, in both the proceedings, sought adjournment vide letters dated 17/01/2017 supra, placed in the appeal files, called for by the Bench. The same implies that the assessee was, for both the proceedings, aware of the ld. CIT(A) being seized of the matter and extending opportunity, which was, granting the request per the said application, adjourned from 18.01.2017 (i.e., the next date in both the proceedings). The impugned order (in one appeal) also records the attendance of one, Sh. Lalit Seth the person signing Form 35 in both the appeals, on 19.12.2016, so that, without doubt, the assessee was aware of the appellate proceedings being on before the ld. CIT(A) at the relevant time. At the same time, the notices prior to 03.01.2017 (fixing the next hearing for 18.01.2017, for which date adjournment was sought), were sent to a combined address, containing both the Sadar Bazar (Delhi) address as well the Industrial Area (Kathua) address, i.e., as mentioned in the title of Form .....

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..... sfaction with the regard to the concealment of particulars of income, but had levied penalty for concealment/furnishing inaccurate particulars of income. The Tribunal, expressing the majority view; the matter having traveled to a third member (who had passed his order u/s. 255(4) on 07.05.2018), held that a penalty order imposing penalty u/s. 271(1)(c) in such a manner is not sustainable in law. In the present case, the AO has in fact levied the penalty on both the counts. We are, however, in view of the set aside afore-said, even as observed during hearing, disinclined to dwell in the matter. The assesssee is at liberty to raise all issues, factual or legal, before the proceedings before the first appellate authority. 4.1 This para is being added in view of the discussion between the members prior to finalizing the order, with a view to clarify the basis of the said decision. As apparent from the foregoing, both the appeals, i.e., on quantum and penalty, are set aside to the file of the first appellate authority in the interest of justice. The Bench indicating so during hearing, no arguments were accordingly made or heard with reference to the decision in HPCL Mittal Energy Lt .....

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..... ng the course of argument of appeals, the assessee has also demonstrated that the penalty case is covered by the decision of (Third Member Case) in the case of HPCL Mittal Energy Ltd. vs. Addl. CIT, Circle-1, in ITA No.554 555(Asr)/2014 and ITA Nos.510 556(Asr)/2014, order dated 07.05.2018 and the Ld. CIT(A). As the Ld. CIT(A) did not pass the orders on merits due to nonappearance of the Assessee because of the aforesaid reasons therefore the Asseeee shall be a liberty to raise all issues including, the squarely covering of penalty case by HPCL Mittal Energy Ltd (third Member's case), before the Ld. CIT(A) who shall decide the penalty appeal while also taking into consideration the HPCL Mittal Energy Ltd. (supra) (Third Member Case). Hence Considering the peculiar facts and circumstances of the case as proper notices have not been served to the assessee, therefore, the assessee did not get reasonable and proper opportunities of being heard and even otherwise the Ld. CIT(A) did not pass the orders on merit, hence, proper course would be to set aside the cases to the files of the Ld. CIT(A) to decide afresh while affording reasonable and proper opportunities of being he .....

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