The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) remanded the matter to the Commissioner of Income Tax (Appeals) for fresh adjudication due to the CIT(A)’s failure to provide a proper hearing notice to the assessee.
Jainish Binitkumar Shah, the appellant-assessee, had assessment orders passed against him by the Income Tax Officer for the Assessment Years 2014-15 and 2015-16, which were later upheld by the CIT(A) by orders dated 07/09/2023 and 15/09/2023.
The assessee , a business entity engaged in trading cattle feed and maize products, contested the CIT(A)’s orders, asserting that they were passed in haste without giving proper opportunity for presenting relevant evidence. According to the taxpayer, the notices for the hearings were not properly served, and the assessments were conducted ex-parte.
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The assessee claimed that the notices issued by the CIT(A) on multiple occasions—15th July, 1st August, and 22nd August 2023—were sent to the email address and mobile number of a previous tax consultant. Consequently, neither the taxpayer nor the previous consultant received these notices, leading to the assesse’s lack of awareness about the appellate proceedings.
The assessee further argued that it was only in April 2024, after receiving a message regarding an income-tax notice under Section 271(1)(c), that it became aware of the passed orders. The CIT(A) had confirmed substantial additions to the taxpayer’s income, based on 8% of the total turnover, which amounted to Rs. 9.04 crore for AY 2014-15 and Rs. 8.67 crore for AY 2015-16. The taxpayer argued that the CIT(A) failed to consider crucial details and evidence submitted before the Assessing Officer (AO) during the assessment proceedings.
Two member Bench composed of Dr. BRR Kumar (Vice President) and Suchitra Kamble (Judicial Member) noted that the CIT(A) had not provided a fair opportunity to the taxpayer to present their case and had not properly considered the submissions made during the assessment stage.
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The Tribunal emphasized that the principles of natural justice were violated due to the lack of adequate communication and the hasty nature of the appellate order.
In light of these issues, the ITAT directed the CIT(A) to grant the appellant a fresh hearing, allowing them to present all necessary documents and evidence. The CIT(A) was ordered to issue a new notice and proceed with the appeal de-novo, ensuring a fair and thorough examination of the case.
This decision marks a significant victory for the taxpayer, as it provides an opportunity to rectify the oversight and potentially reduce the contested additions. The appeals were disposed of for statistical purposes, with the Tribunal’s instructions to the CIT(A) to complete the proceedings afresh.
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