ITAT Imposes ₹10,000 Cost on Taxpayer for Non-Appearance for Hearing, Remands Gift and Gold Sale Addition Matter to CIT(A) [Read Order]

The Chennai bench of  Income Tax Appellate Tribunal ( ITAT ) has remanded the addition of cash received from gift and sale of gold back to the Commissioner of Income Tax ( Appeals ) [ CIT(A) ] imposing cost of Rs. 10,000 on the assessee for the non-appearance for hearing despite issuing multiple notices.

In the assessment order, the A.O has made an addition of Rs. 22,64,000/- on account of cash received from the sale of gold and Rs. 35,54,200/- on account of cash received as a gift. Aggrieved by these additions, the assessee filed an appeal before the CIT(A).

However, during the appellate proceedings, despite four notices issued between 09.12.2024 and 07.01.2025, the assessee failed to comply or make any representation. Consequently, the CIT(A) passed an ex-parte order, confirming the additions made by the AO.

Before the ITAT, the assessee’s Authorized Representative (AR) argued that the CIT(A) had issued multiple notices in a short period and dismissed the appeal ex-parte without granting sufficient opportunity.

The AR requested that, in the interest of justice, the assessee be provided another chance to present their case. On the other hand, the Departmental Representative (DR) supported the orders passed by the lower authorities.

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The tribunal noted the non-appearance of the assessee before the CIT(A) and the ex-parte dismissal.

However, upholding the principles of natural justice, the bench of S S Viswanethra Ravi and Jagadish concluded that the assessee deserved one more opportunity to substantiate their case.  The bench made this allowance on condition that the assessee must pay a cost of ₹10,000 to the Tamil Nadu State Legal Services Authority at the High Court of Madras within one month from receiving the order, and produce proof of such payment before the CIT(A).

Accordingly, the ITAT set aside the CIT(A)’s order and remanded the matter for fresh adjudication, directing the CIT(A) to grant the assessee a proper hearing and decide the matter in accordance with the law. The assessee was also explicitly instructed to appear on the next hearing date without fail.

To Read the full text of the Order CLICK HERE

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