ITAT Grants Liquor Shop Owner Second Chance, Cites Natural Justice in Ex-Parte Case [Read Order]

The Nagpur Bench of the Income Tax Appellate Tribunal (ITAT) has given the owner of Uday Country Liquor Shop in Yavatmal district, a fresh opportunity to present her case after her appeal was dismissed ex-parte by the Commissionerof Income Tax (Appeals), National Faceless Appeal Centre, Delhi.

Hameeda Arif Lalani had approached the ITAT after the appellate authority rejected her appeal without hearing her side, citing repeated non-compliance with notices and show cause letters. The Commissioner of Income Tax (Appeals) noted that multiple notices were sent to the email addresses on record, but neither any adjournment request nor any written submissions were received from the appellant.

As a result, the appeal was decided ex-parte, with the authority relying solely on the assessment order and the materials already on record.

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During the hearing before the ITAT, counsel for the assessee, P.M. Gandhi, admitted that there had been lapses on the part of the taxpayer in not appearing before the appellate authority. He requested the Tribunal to grant one more opportunity so that the appellant could substantiate her case with proper evidence before the first appellate authority. On the other hand, the Departmental Representative, Abhay Y. Marathe, argued that the taxpayer had already been given sufficient opportunities and supported the ex-parte order passed by the Commissioner of Income Tax (Appeals).

V. Durga Rao (Judicial Member), after hearing both sides and examining the records, observed that although the appellate authority had issued several notices, the order was ultimately passed ex-parte without hearing the taxpayer.

The Tribunal emphasized the importance of the principles of natural justice and held that the taxpayer should be given a reasonable opportunity to present her case. The Tribunal also directed that the taxpayer should not seek adjournments without justified reasons.

In Conclusion, the appeal was allowed for statistical purposes, and the matter will now be reconsidered by the appellate authority, ensuring that the taxpayer gets a fair chance to be heard.

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