The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has directed re-adjudication as the notice served on ex-employee was a reasonable cause for non-compliance of such notice.
The assessee company, Kaveri Infrastructure Pvt was engaged in the business of works contracts of Tubewells and Sewerage contracts. A search and seizure operation under Section 132 of the Income Tax Act, 1961 was carried out on 24.04.2007 at the premises of the assessee and consequent assessment under Section 143 (3) read with Section 153A of the Act was completed on 29.12.2009 wherein various additions were made to the returned income.
R. S. Singhvi,who appeared on behalf of the assessee submitted that assessee company had closed its business operations and almost defunct and, therefore, notices were issued by the Commissioner of Income Tax (CIT(A)) through e-filing portal could not be seen and compiled as there was no regular employee looking after the affairs of the assessee company.
Modh. Gayasuddin on behalf of the revenue submitted that despite many opportunities provided to the assessee by the CIT(A), no compliance was made, therefore, the CIT(A) was justified in adjudicating the appeal ex parte qua assessee.
Division Bench of Dkul Bharat, (Judicial Member) and O.P. Kant, (Accountant Member) allowed the appeal observing that, “In our opinion, in the circumstances of the case there is a reasonable and sufficient cause for non-compliance on the part of the assessee. Therefore, in the interest of substantial justice, we set aside the order of the CIT(A) and restore the matter back for providing one more opportunity to the assessee by the CIT(A).”
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