The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) restored the matter to Assessing Officer (AO) for a de novo assessment in a case involving the disallowance of Rs. 17.17 lakh in expenditure.
Mayur Kanubhai Patel, appellant-assessee, challenged the order dated 05.04.2024 passed by Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC) for the Assessment Year 2018-19 passed under Section 250 of the Act.
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The assessee raised several grounds of appeal, arguing that the assessment order under section 143(1) and its confirmation under section 250 were incorrect and should be set aside. The assessee also contested the disallowance of Rs. 17,17,527/- and requested its removal. The appellant reserved the right to add or change grounds during the hearing.
The AO passed the assessment order under section 143(3) read with section 144B of the Act, due to the assessee’s failure to comply with the notices issued. The appeal filed by the assessee before the CIT(A) was also dismissed without consideration.
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Section 143(3) read with Section 144B of the Act, deals with the detailed assessment of a taxpayer’s return. Under Section 143(3), the AO examines the return, verifies income, and makes adjustments if necessary, passing an assessment order. Section 144B applies when the assessment is conducted under the faceless assessment system, ensuring transparency and fairness by allowing electronic communication and providing the taxpayer an opportunity to respond to notices. Together, these sections ensure a thorough and transparent process for assessing returns, especially in faceless assessments.
The two member bench comprising Dr. BRR Kumar (Vice President) and Suchitra Kamble (Judicial Member), hearing the assessee counsel noted that the assessee would comply with the requirements before the AO if given the chance. In the interest of justice, the tribunal decided to send the matter back to the AO for a fresh assessment, allowing the assessee a proper opportunity to be heard.
In short,the appeal filed by the assessee was allowed for statistical purposes.
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