Non-Appearance Due to Accounts Team Employee's Exit from Company: ITAT Imposes ₹5,000 Penalty and Remands Matter [Read Order]

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) remanded matters to the Commissioner of Income Tax (appeals)[CIT(A)] considering that the non-appearance was due to employees' exit and imposed Rs. 5000 as a penalty.

ACHE Housing India Private Ltd (assessee) is engaged in the building and development of real estate property. The assessee filed an Income Tax Return (ITR) and claimed depreciation on goodwill of Rs. 40,24,09,376 and several deductions related to delayed payment of TDS and delayed filing of return.

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The Assessing Officer (AO) issued a notice seeking an explanation from the assessee. The AO made additions after the assessee furnished details explaining the claim of deduction. The assessee filed an appeal before the CIT(A).

The CIT(A) after giving several opportunities passed an ex parte order. The Exparte order upheld the additions made by the AO. Aggrieved by the order of the CIT(A), the assessee filed an appeal before the ITAT.

The counsel for the assessee acknowledged that the CIT(A) issued 9 notices to the assessee. The counsel also stated that the assessee sought adjournments in all these occasions. The counsel further submitted that the assessee faced financial problems for several years.

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The counsel submitted that the account team employees left the job when the notice of the revenue was issued. The counsel further stated that there was no one to comply with the notice of the revenue. Therefore, the counsel prayed to restore the matter to the CIT(A) and decide the matter afresh.

On the other hand, the counsel for the revenue strongly opposed the prayer of the assessee's counsel. The counsel for the revenue contended that there were a total of 9 opportunities given to the assessee. The counsel also contended that the assessee failed to attend all of the opportunities and sought adjournments on all hearings.

The tribunal observed that the assessee failed to appear at any hearing fixed by the CIT(A). The tribunal also noted that the reasons for the assessee's non-appearance were also placed before the CIT(A).

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The tribunal comprising Amit Shukla (Judicial Member) and Girish Agrawal (Accountant Member) imposed a penalty of Rs. 5000 for the non-appearance of the assessee. The tribunal also accepted the prayer of the assessee and remanded the matter to the CIT(A).

Thereby, the appeal was allowed for statistical purposes.

To Read the full text of the Order CLICK HERE

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