The Income Tax Appellate Tribunal (ITAT), Chennai Bench, has recently, in an appeal filed before it, set aside the orders of CIT (A) being ex-parte, on the ground that the assessee lacked proper opportunity before the AO due to dire financial stress and difficulties.
The aforesaid observation was made by the Chennai ITAT, when appeals were filed before it by the assessee, as against the order of the Commissioner of Income Tax (Appeals), Chennai, dated 18.09.2019, for the Assessment Year (AY) 2014-15.
With Mr.T. Chaitanya Kumar, the AR of the assessee having brought to the ITAT’s notice that, the impugned order of the CIT(A) dated 18.09.2019 as well as the order of the AO dated 31.10.2016, were ex-parte orders, he therefore, prayed that since the assessee did not get proper opportunity, the matter may be restored back to the file of the AO for de-novo assessment.
In support of his claim, the AR relied on the decision of the Supreme Court in the case of M/s Tin Box Company v. CIT, wherein the Supreme Court had held that, if the assessee did not get proper opportunity before the AO, then, the assessment has to be framed de-novo.
However, on the other hand, Mr.D. Hema Bhupal, the JCIT, strongly relied on the orders of the authorities below.
Hearing the opposing contentions of both the sides as well as perusing the materials available on record, the Chennai ITAT held:
“We note that the order passed by the Ld.CIT(A) is an ex-parte order and even the AO has passed order u/s.144 of the Act (best judgment assessment) without participation of the assessee. Since, the assessee did not get proper opportunity before the AO due to dire financial stress and difficulties noted (supra) during that time, for the ends of the justice and fair play, we set aside the impugned order of the Ld.CIT(A) and restore the matter back to the file of the AO for de-novo framing of assessment.”
“Needless to say, that the assessee may be given proper opportunity of hearing; and the Ld.AR of the assessee has undertaken before us that the assessee would be diligent and will participate during the course of assessment proceedings, and if advised to do so, file relevant evidences/documents to substantiate its claim as well as file written submissions to support its claim,” the Panel consisting of Manjunatha G, the Accountant Member and Aby T Varkey, the Judicial Member added.
Finally, the Chennai ITAT held:
“The AO is directed to frame assessment in accordance to law. In the result, appeal filed by the assessee is allowed for statistical purpose.”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
